Say Goodbye to McMansions: Why Homebuyers Are Embracing Smaller, Simpler Homes

For decades, the American dream was embodied by sprawling “McMansions”—expansive, multi-winged homes with more bedrooms and bathrooms than some homeowners even needed. But today, a growing wave of buyers—from first-timers to downsizing retirees—are turning their backs on oversized homes in favor of smaller, more manageable, and intentionally designed spaces.

This shift isn’t just about square footage. It reflects deeper changes in lifestyle preferences, generational priorities, housing affordability, and how people envision homeownership in a post-pandemic world.

The Great Size Reversal

After peaking at 2,500 square feet in 2015, the median size of newly built homes has steadily declined, hitting 2,210 square feet nationwide, and 2017 square feet in Virginia in 2025, according to the National Association of Realtors (NAR). Census data and buyer surveys both confirm the trend: people simply want less space.

“While the data is showing a shrinking square footage, the more interesting thing is why,” says Jessica Lautz, deputy chief economist at NAR. “We’re seeing more single homebuyers and more child-free homebuyers—retirees, empty nesters, or people who don’t plan on having children. They don’t need as much space as we saw a decade ago.”

But the shift isn’t exclusive to older generations. Millennials and Gen Z—who now make up a substantial share of the buyer pool—are also seeking smaller homes. The appeal? Simplicity, affordability, sustainability, and proximity to the kind of lifestyle they want.

Affordability Meets Practicality

Housing affordability is a key driver behind the shrinking home. Prices have soared in recent years, and the fastest-selling homes in the U.S. are now in the $200,000–$350,000 range. For many first-time buyers, smaller homes aren’t just preferable—they’re the only viable option.

Builders have taken note. “Builders see a market for smaller homes as demographics have changed and housing affordability impacts buyers’ ability to enter the market,” says Lautz. Both downsizers and first-time buyers are fueling demand.

Meanwhile, existing homes that are modest in size but fully renovated are also hot commodities—especially in walkable, established communities. Andrew Nelson, a real estate agent with Compass, notes that in communities like Capitol Heights, MD, three-bedroom, one-bath homes from the 1940s and ’50s—upgraded but not expanded—are flying off the market in just a few days. “Buyers are compromising on size to become owners,” Nelson says.

The McMansion Problem

As buyers flood the market for smaller, more efficient homes, many baby boomers are discovering that their once-coveted large homes are no longer in demand.

“There’s a generational tug-of-war in the housing market,” says Rick Palacios, director of research at John Burns Real Estate Consulting. “Everyone wants the same type of home—smaller, easier to maintain, and in walkable communities.” Millennials, who now make up the largest share of homebuyers, are largely uninterested in inheriting massive, high-maintenance suburban homes.

This has created a traffic jam in the housing ladder: boomers can’t downsize until they sell, but millennials don’t want to buy their oversized homes. As a result, the McMansion—once a symbol of status—is becoming more of a burden than a benefit.

Enter “Simple-Sizing”

Real estate professionals and consumer surveys point to a new cultural movement: “simple-sizing.” The concept isn’t just about downsizing; it’s about right-sizing—choosing a home that aligns with your lifestyle, values, and needs.

A recent Opendoor survey found:

• 52% of respondents want a smaller home

• 81% prefer a simpler design

• 75% are open to downsizing, with 79% planning to do so in the next year

• 87% value a simplified lifestyle

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“Buyers are choosing less square footage in exchange for flexibility, freedom, and function,” says DeLisa Dawkins, a realtor with Realty ONE Group Freedom. “This isn’t just a trend among retirees—it’s a cross-generational shift.”

Simplicity is the New Luxury

The minimalist design movement isn’t just an aesthetic choice—it’s tied to functionality, affordability, and a sense of peace. “Simple designs are increasingly seen as luxurious because they focus on quality over quantity,” says Greg Forest of Sotheby's International Realty.

Smaller homes often offer open floor plans that promote togetherness and flexibility. Rooms are designed for multiple uses—working from home, entertaining, or family time. Buyers are also more focused on outdoor space, whether it’s a yard for relaxation or gardening, or proximity to parks and nature.

Many also appreciate the environmental benefits. Smaller homes mean lower energy costs, reduced waste, and a lighter ecological footprint—values especially important to Millennial and Gen Z buyers.

The pandemic also made one thing clear: your home needs to function as much more than a place to sleep. It’s an office, gym, retreat, and entertainment hub. Remote work has allowed people to move beyond cities and dense suburbs, and they’re using that freedom to seek out quieter, more secluded locations.

“People want privacy, space, and a quieter lifestyle,” says Maureen McDermut, a realtor in Santa Barbara. “The city no longer has to be your home base, and that opens up a lot of possibilities.”

Will McMansions Disappear?

Not entirely. There’s still a niche market for luxury estates, legacy properties, and larger homes built for multi-generational living. In wealthy enclaves like those in suburban D.C., builders like Artisan Builders continue to see demand for 10,000-square-foot homes complete with elevators and guest suites.

But for the majority of buyers, the future looks smaller, simpler, and smarter.

“There’s a real shift in what the American Dream looks like,” says Lautz. “It’s not about the biggest house anymore. It’s about a home that fits your life—financially, functionally, and emotionally.”

Bottom Line:The days of the McMansion aren’t entirely over—but they are no longer the aspiration for most. Today’s homebuyers value simplicity over size, functionality over flash, and location over luxury. In a changing market and world, smaller homes offer something increasingly rare: freedom.

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Sources: NAR, Trading Economics, Washington Post,