If you're a home buyer sitting on the sidelines for the deal of the century, you may be kidding yourself. That dream home you're waiting to buy when the housing slump is over is likely to be smaller, plainer, and more expensive later than today's homes.

Why? Homebuyers want homes to be less expensive, but what they don't know is that building costs are about to skyrocket.

According to the National Association of Home Builders, some costs associated with building are going down because of lower demand for housing, like labor, gypsum, insulation and lumber. But any material associated with oil is shooting up. In other words, there's a bubble in PVC pipe.

Buyers think time is on their side because demand is currently suppressed by fear, plummeting home prices, and tighter credit. That's created up to 11 months of standing inventory waiting to be sold.

But when that inventory's gone, look out.

"It doesn't take an economist to see that when we start building again, lumber, gypsum and labor will be more expensive," says Bernard Markstein, senior economist and director of forecasting for the National Association of Homebuilders.

Builders will build to the market and that means they'll be looking for ways to cut the price of homes. Get ready for even smaller lots, less square footage and fewer luxury materials like Italian marble and Brazilian cherry hardwoods.

So should you buy a new home now or wait?

Let's see what history tells us. More square footage took off with the baby boomers. In 1978, median square footage for new homes was 1,650 square feet. The oil embargo and subsequent recession of the 1970s resulted in smaller homes being built between 1979 and 1982. Square footage grew again in '85 and fell in '95, after the recession of the early 90s.

Home sizes in 2006 set a record high of 2,237 square feet. Since then homes have lost value, credit has tightened limiting the number of buyers, and jobs have been lost. That spells smaller housing with fewer bells and whistles.

Markstein says square footage numbers aren't out for 2007 yet, but he says median square footage will be down, and it's certain to be down in 2008. So if you really want that free swimming pool, now's the time.

Published: May 21, 2008

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Blanche Evans is the award-winning senior editor of Realty Times, the Internet's leading independent real estate news service. She is featured daily on the Realty Times Video Network in the "Realty Viewpoint" segment. Blanche has been named one of the "25 Most Influential People In Real Estate" by REALTOR Magazine, and has been twice recognized as a "notable." In 2005, she was named "Top Reporter Covering the NAR" by Delahaye-Bacon's. Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. To contact Blanche, email her at . For more articles by Blanche, click here.