But five years of considerable prosperity and easy credit have honed self-indulgence. The big-home phenomenon is a prime example. Not all consumers, however. High earners, in sum, are sustaining home construction, an important leg of the economy, and their preference for McMansions, the giant-home phenomenon that first appeared in the late 1990's, keeps pushing up the size of the average home. They don't have a problem.
Economists see logic in the big-home craze.
Falling interest rates make financing cheaper. Baby boomers are still buying or building homes. Tax cuts in 1997 added an incentive. And despite the slowdown, the prices of big homes all homes, for that matter keep rising. Many experts, in fact, argue that home prices are likely to hold their own during a recession, or at least not slip much.