ANALYSIS: Localities, Buyers in Love with Larger Homes
If we're to grow more affordable housing, however, both are going to have to adjust their expectations.
By Martin Davis
EDITOR-IN-CHIEF
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In the post-World War II boom era, America faced a crushing demand for housing as soldiers returned from war and an unprecedented baby boom set it. The solution?
Build more homes. Lots of them. But it wasn’t just more homes, it was smaller homes. Prior to World War II, the average home size was 1,177 square feet. In 1950, it was 982 square feet.
Why smaller? Because the Federal Housing Authority prioritized lower priced homes. And the easiest way to lower the cost was to reduce the size of the house.
How far we have come from those days. But before reading on, take a quick one-question poll.
If you answered 4-bedroom, you are correct.
Earlier this month, the Fredericksburg Area Association of Realtors published their annual real estate market statistics for the greater Fredericksburg region. It provides some striking insights into why housing is so expensive in our region.
The two markets with the most home sales in our region — by far — over the past year are Stafford County (1,908 detached and attached units) and Spotsylvania County (1,850 detached and attached units).
The average sold price in Stafford is $565,825, but there was a significant difference in both price and number of units sold between detached and attached units.
The average price for an attached unit in Stafford in 2025 was $405,966. For a detached home it was nearly $200,000 more — $604,075.
Only 369 attached units were sold in 2025, while 1,539 detached units were sold.
Why were the detached units so much more expensive? Well, size of the house has a lot to do with it.
Of the 1,539 detached units sold, 1,126 of them — 73% — were homes with four or more bedrooms. The average price for a detached four-or-more-bedroom home? $651,348.
The story in Spotsylvania County is much the same.
The average price for an attached unit in Spotsylvania in 2025 was $394,136. For a detached home it was about $150,000 more — $544,777.
Only 300 attached units were sold in 2025, while 1,550 detached units were sold.
Again, the largest homes were the most popular.
Of the 1,550 detached units sold, 944 of them — 61% — were homes with four or more bedrooms. The average price for a detached four-or-more-bedroom home? $621,024.
Smaller Homes Hard to Find
Not surprisingly, smaller homes are less expensive — there are less materials needed to construct a smaller home. In Spotsylvania, the average sales price for a 3-bedroom detached home was $429,984. For a 2-bedroom home it was $379,775.
If you can find one.
In Spotsylvania, there were 561 detached units sold with three bedrooms. These homes’ average sales price is nearly $200,000 less than for a 4-or-more-bedroom home. They represent about 36% of all detached homes sold in Spotsylvania.
For 2-bedroom homes, which are nearly $250,000 less than a 4-or-more-bedroom home, there were just 45 of these sold in 2025.
The picture is just as stark in Stafford.
There, 343 detached units sold with three bedrooms. These homes’ average sales price is nearly $167,000 less than for a 4-or-more-bedroom home. Yet, they represent only 22% of all detached homes sold in Stafford.
For 2-bedroom homes, which are nearly $220,000 less than a 4-or-more-bedroom home, there were just 70 of these sold in 2025.
Supply, Demand, and Desire
On one level, these figures represent basic issues of supply and demand. People want larger homes. And so that’s what gets built.
But supply and demand alone don’t account for this. Localities are loathe to approve the building of smaller homes because they generate fewer taxes and place more demand on infrastructure (schools, first-responders, roads).
As the issue of home affordability rises, however, localities and buyers are going to have to adjust their thinking about the size of homes built. Perhaps more than any other factor, reducing the amount of material required to construct a home is the surest way to reduce the associated costs.
And that means people becoming comfortable with the idea of living again in smaller homes.
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Really interesting article! But I wonder if the data presented means what we think it means.
Okay, so 4-bedroom homes are the ones that are mostly being bought and sold in this area.
I personally know several people who would love to become first time home-buyers, but they can’t afford these larger homes, and so they are looking (and looking, and looking) for smaller homes, but there are none on the market, because the people who own those homes are typically less likely to sell them.
Those are just folks that I know, and the plural of anecdote definitely isn’t data!
But it does make me wonder if 4-bedroom homes are what is selling because that’s what is actually in demand, or if that’s just what’s more available?
Google Abraham Wald for a fantastic story about how important it is to really think about what story the data is actually telling us!
P.S. The interpretation of the data in this article might well be 100% spot on! I’m just speculating here! 🙂