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Filling in the Middle

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Filling in the Middle

February 14, 2019
Developers are increasingly addressing the need for a greater variety of housing options for middle-income households, or "missing middle housing."
Photo: Unsplash/Ivan Bandura

Developers are increasingly addressing the need for a greater variety of housing options for middle-income households, or "missing middle housing."

Previously, developers and builders were more focused on product at the more expensive end of the market in order to keep projects profitable and cost-effective. Now, momentum is shifting toward adding more housing at smaller sizes (see duplexes, multiplexes, courtyard apartments, pocket neighborhoods, and bungalow courts) with greater walkability and community proximityThe Washington Post reports that new data from the National Association of Home Builders (NAHB) show the average size of new houses declined for the third straight year in 2018.

John Zogby, a public opinion pollster, said his research has found that millennials would prefer to buy smaller houses, if they buy at all, using the excess cash on experiences. “The whole idea of even owning a home as part of the American Dream for the first time is being challenged,” he said. “There is a greater sense of mobility in modern society. Hence, owning a home, having a mortgage and being fixed in place is not as popular as it once was.”

Paul Habibi, a professor at UCLA’s Ziman Center for Real Estate, disagrees. His experience is that conventional wisdom holds for young buyers. “People generally want to buy the largest home they can,” he said. “I don’t know too many millennials who would turn away a larger house if they could afford it.”

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