American Apartments Are Getting Smaller: 10 Main Reasons (Explained)

As the cost of living in American cities continues to rise, more and more people are looking to downsize from their houses to apartments.

However, many are surprised that apartments are much smaller than expected. In this article, we will explore some potential reasons for the decrease in the size of American apartments.

From lower costs and greater housing demand to more privacy, flexibility, and the trend of downsizing, we will see why smaller apartments are becoming more popular and what benefits they offer to renters.

1. Lower Costs

As companies build new apartment buildings, making units smaller is the best way to decrease construction costs.

When they start renting out these units, the landlords can pass those savings off to the tenants. That doesn’t mean it will always happen; some small apartments are quite expensive.

However, you’ll have a better chance of snagging an apartment with more affordable rent. Even if the rent is high, you may be able to save in other ways.

For example, you won’t have to pay as much for utilities to heat or cool a smaller space. If you live somewhere where you get all of the seasons, you could save a lot of money this way.

You also won’t have to pay to fill as large of a space, so you won’t need as much furniture.

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2. Accommodate More Units

Smaller apartments also allow for more units to fit in the same space. This helps landlords increase the housing supply so more people can find places to live.

As a renter, you’ll have more options for where to live, especially if you live in or near a city. Then, you can find a place near your work or close to your favorite grocery store.

Of course, landlords also want to make more money, and building more units is a great option. For better or worse, they may not charge half the rent for a unit that’s half the size of another.

That means landlords can make more money from the same amount of space. That can help you as a renter because the landlord is more likely to keep the apartment up and running for years to come.

3. Greater Housing Demand

Because you can build smaller apartments, you can match the growing demand for housing.

I don’t know about you, but I can’t afford to buy or even rent a house, especially with how expensive they’ve gotten.

However, apartments are usually more affordable. Many people don’t make enough money to afford a larger home, which is unfortunate.

Smaller apartments can meet a growing need for affordable housing in cities and suburbs. The demand for housing is probably only going to continue to grow.

4. More Privacy

Sure, you can share a larger house or apartment with roommates to save on costs and not worry about housing demand. But I like to have some privacy and alone time.

Building smaller apartments can give single individuals and even couples more privacy. Fewer people have to find roommates, and we can all have more control over our home lives.

It can be especially nice not to have roommates if you work from home. That way, you can work in peace and not have to deal with people barging in or making a ton of noise.

And while some apartments are quite small, some have plenty of space for a home office. I keep my desk in the corner of my living space so it doesn’t get in the way when I’m not working, but it’s there when I need it.

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5. Space for Community Amenities

Maybe a new apartment building doesn’t have more units, but the units are smaller than older ones. It could use the extra space for community amenities, like a laundry room.

Some buildings even have a cafe or coworking space on the first floor. That way, you can get a drink or snack and work remotely while leaving your apartment.

Other apartments have gyms or pools that all of the residents can access. This can be a great option if you want to stay active but don’t want to have to join a gym or buy your own equipment.

So even if you find a smaller apartment with higher rent, that could be worth it. You might save money compared to renting at a different place, plus the cost of a gym or coworking membership.

6. Better Private Amenities

When a landlord builds smaller apartment units, they’ll pay less to build each one. Then, they could use those savings to provide tenants with better appliances, for example.

Or they may offer in-unit laundry to certain apartments. In my last apartment, my landlord offered me the choice between a few small upgrades when I renewed my lease.

So I could have gotten better shelving in the closet or something similar. When the cost to build and maintain an apartment is lower, you may get nicer features out of it.

Of course, not all landlords will offer this, but you can shop around for apartments with nice in-unit amenities. Then, you can feel more comfortable when you’re at home, even if the space is a bit smaller.

7. More Flexibility

Another reason why some apartments are smaller sounds counterintuitive. However, these units may be more flexible than larger apartments.

Instead of building a two-bedroom apartment, a landlord may build a series of one-bedroom units. But they may come with a den that you can use differently.

You could turn it into a smaller second bedroom for guests. Or maybe you work from home, so you use the space for your desk to complete your work tasks.

This flexibility can make small apartments suitable for individuals, couples, and even small families. If you don’t want a massive house, you may still have enough room to live with your loved ones or on your own.

And even if you don’t have a child yet, you could live in the same apartment after you have your first child.

8. The Downsize Trend

A lot of people are looking to downsize from a house to an apartment. Some families may still need larger apartments, especially those with multiple kids.

However, if you don’t have kids or if your kids have moved out, it makes sense to move to a smaller apartment. Landlords have caught onto this trend and are taking advantage of it by building smaller units.

That can make it easier to find tenants to fill these spaces. On the tenant side, you’ll have more options to find a unit that meets your financial and lifestyle needs.

Downsizing isn’t right for everyone, but it can be a great decision for some people. If you want to move out of your current house, you may love the selection of smaller apartments in the US.

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9. Declining Birth Rates

Another possible reason why apartments are getting smaller is the declining birth rate in the US. The average woman in 1976 had three children, but in 2018, that number was only two.

Many people choose to have children later in life or not at all. And when you don’t have children, it often doesn’t make sense to live in a massive house with you and your partner.

Even a larger apartment might not be a smart financial choice for some child-free couples. You can make your overall income go much farther when you decrease your housing costs.

Moving from a house to an apartment is one of the easiest ways to do that. You won’t have to deal with yard maintenance; your utility bill can also decrease.

10. Increasing Average Age at Marriage

Along with lower birth rates, people are waiting longer to get married. In 2001, the average woman was 25.1, and the average man was 26.9 at the time of their first wedding.

Twenty years later, in 2021, those ages increased to 28.6 and 30.6, respectively. People who stay single longer may want to live independently in an apartment for a few extra years.

Even once people start dating and move in together, they may wait until after marriage to buy a house. Since marriage ages have risen by about three years, it’s safe to assume people will stay in an apartment for three years longer.

Sure, some unmarried people will choose to buy or rent a house. And some married couples will stay in an apartment after their wedding day, but it’s still worth noting how people get married later.

Sources

Apartments Are About to Get Smaller. That’s a Good Thing

The Average Apartment Size in America Is Shrinking, According to a New Study

U.S. Birth Rates Continue to Fall

Age of Americans at their first wedding