Home Sizes Are Shrinking in These Southern Cities

The South is seeing smaller homes on the market compared with pre-pandemic norms, according to Realtor.com's September housing market trends report. That downsizing is the result of a 52% increase in the average price per square foot in the South this year, leading to a 35.7% rise in the median listing price of homes in the region.

Home builders across the South are adapting to higher prices and waning demand by offering smaller, more affordable housing options. In Chattanooga, Tenn., the typical home from 2017 to 2019 averaged 2,162 square feet for a total price of $261,418, but in 2023, the typical home was 2,097 square feet for a total of $425,313, according to Insider.

More smaller homes are on the market in the South than pre-pandemic, Danielle Hale, Realtor.com's chief economist, told Insider.

"It might be that we're seeing more homes for sale in the more dense areas of these metros, where homes would likely be smaller," she said. "It might also be the case that new construction homes are a more significant share of active listings in these areas, and Census data has shown that builders are adapting to high home prices by cutting home size to enable more housing affordability."

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