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Wonkblog: The price of new homes is surging — in part because houses are getting bigger

http://www.washingtonpost.com/blogs/wonkblog/wp/2014/04/24/the-price-of-new-homes-is-surging-in-part-because-houses-are-getting-bigger/

This is interesting, and a logical consequence of the increase in income inequality and overall inaccessibility of homeownership to the lower class.

I do wonder what this means for the prices of smaller homes, though. If they aren’t being built, there’s neither a shift in demand nor in supply, meaning that a safe assumption would be values that track inflation but no more. However, if energy prices go up or something else happens that squeezes the ability of even wealthy owners to have bigger houses, this trend could change.

I am very interested in the energy trend’s impact on housing, as well as the shift back towards cities…though as you get closer to the city core properties get smaller anyway, so this may be an independent trend (or an unrelated one, as development in the city core tends to be very capacity constrained).

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