A Higher Monthly Payment, however Less Square Footage

Two years in the past, when rates of interest had been low, the common Hayden house was a 1,900 square-foot three-bedroom that price $500,000, or about $2,000 a month, mentioned Steve Klingman, the corporate’s president, in an interview. This assumed a 5 p.c down fee and a 30-year fixed-rate mortgage with a 3 p.c rate of interest.

Now, as borrowing prices eat extra of consumers’ mortgage funds, Hayden is reducing costs and sq. footage to maintain clients’ funds secure. The common Hayden house is now 1,550 sq. toes and prices about $400,000, or $2,100 a month, Mr. Klingman mentioned. To purchase it, nonetheless, a buyer has to supply a ten p.c down fee and, even with incentives, is paying a 6 p.c price on a 30-year fixed-rate mortgage.

“We are reconfiguring our floor plans, our features and community design all to get to that payment buyers can afford,” Mr. Klingman mentioned. “People want to own if we can make it attainable.”

In dense areas like Southern California, the excessive price of land has lengthy led builders to deal with compact houses. Trade-offs like a aspect yard as a substitute of a yard, or a storage that opens to the road as a substitute of a driveway, have compressed measurement and diminished price. Now these sorts of city designs are arriving within the exurbs.

For occasion, in Hayden’s hometown, Redmond, Ore., a metropolis of 35,000 about half-hour from Bend, Ore., its Cinder Butte Village growth now has houses as small as 400 sq. toes (a one-bedroom, one-bath with a storage on the again alley). The common is round 1,000 — half the standard house measurement in the neighborhood two years in the past.