What do we prove with huge houses we can’t afford to pay for or even fill?

About 10 years ago, I was at the home of a new political client for a photo shoot involving his family. He lived with a wife and two teen-age kids in a large, sprawling house that looked really impressive. When I got there, the candidate wasn’t home yet, but his daughter was expecting me and let me in.

I told her I wanted to look around at the different rooms to find the best place to shoot pictures. She started showing me the downstairs and then mentioned a large den upstairs with a fireplace that she thought might be nice, so we went to look. We walked up a massive staircase that led to two upper floors, one of which partially looked over the foyer and living room.

We walked down a couple of halls and I started feeling as though I was in a motel. There were doors everywhere. We looked at the den, but I finally asked her about all the other rooms.

“What’s in all of those rooms?” I asked. “It’s just the four of you who live here, isn’t it?”

It turns out that most of the rooms in the house where empty. She showed me. They were large and bare. The daughter couldn’t explain why they had all that empty space and she didn’t seem to understand why I found it odd to have all that much space for so few people.

That candidate didn’t run a serious race and he lost. I never dealt with him again. The only news I ever heard from him after that was when he had declared bankruptcy and lost his impressive home. So what was he trying to prove with that big, empty house? Why have so many people ended up with big houses they can’t afford and certainly don’t need?

I think some of it is cultural. We developed an attitude that bigger is better. And if you live in a neighborhood with houses that are big and expensive, that made you a better person. Or something like that.

The average home size in the United States has almost doubled since 1970, according to the National Association of Homebuilders. This trade group says the average house was 2,700 square feet in 2009, up from 1,400 square feet in 1970. We also have far bigger houses than the rest of the world, on average. According to these figures reported by the BBC (and attributed to the U.S. Census Bureau), the average home in the United States was 2,303 square feet, compared to 1,475 square feet for Denmark, 1,216 square feed for France and just 818 square feet in Great Britain. (The figures from the Census Bureau and the homebuilders are slightly different because the homebuilders would have used the size of new construction and the Census Bureau would use the average of all homes.)

I’ve been thinking about this in my own life for years, partly because I live in a place that’s too big for me. I have a townhouse that’s about 1,450 square feet. How much space do I really need? Probably about a fourth of that. But I pay for this much space and I heat it and cool it. Why? I’m not sure. It’s just the way we do things, I guess.

I’ve been thinking that maybe many of us would do better if we returned to smaller houses. For those in bigger cities with expensive real estate, prices are so high that home sizes aren’t huge for anyone other than the very wealthy. But for many of us, we’ve ended up in places far too big. Is this a problem? Yes, I think it is.

As long as real estate values are headed higher, it seems easy to keep moving to bigger and better houses, because the higher value will make it worth selling for a profit. But what about when values are flat or decline? What about when we face an inevitable economic downturn and it’s suddenly a struggle for people to make those monthly payments? All of a sudden, we’re faced with a crashing housing market, a financial sector teetering on the verge of collapse and angry people looking for others to blame that they’re in foreclosure.

Even if we can “afford” to have mortgages — in the sense of being able to easily make the payments — is it a smart thing to do? More and more, I’m thinking that it makes sense to build or buy something tiny for whatever cash you can come up with, then saving money until you can actually pay for something a bit bigger. I know there are tradeoffs — and I know that different size tradeoffs will be appropriate for different families — but I see far too many people who live in huge houses that they absolutely don’t need, yet they’re struggling to afford their lifestyles.

Take a look at the video below. It’s about a family of four — husband, wife and two kids — who live in a 168-square-foot house that they built for $12,000. It’s certainly not ideal (and it’s smaller than what I’d want with kids), but it’s what they needed to do after the economic downturn destroyed their business and led to their losing their home in 2008. Because they live in a tiny house that’s paid for, they’re able to save for another house — and when they buy it, they’ll own it outright.

So how did we ever get into this situation? As I said, I think culture has a lot to do with it, but I think lobbying pressure from the homebuilding industry, the financial industry and Realtors had a lot to do with it. Those groups have powerful lobbies in Washington. Do you think it’s just a coincidence that federal tax policies have subsidized the building and financing of bigger and bigger houses?

Realtors, builders and bankers want us to buy bigger and better houses. Builders want to build the houses. Realtors want to sell them. Banks want to make interest from the loans. (Speaking of loans, even if you’re not one of those with 30-year mortgages that might never be paid off, have you ever looked at an amortization schedule for your mortgage? Do you realize how much of your monthly payments are pure interest for the banks? Plug your own numbers in here. You might be surprised to see half of your monthly payment going to the bank, not toward your principal.)

If you want to take a chance by having a big, expensive house that could become a dead weight around your neck in times of financial trouble, that’s your business. But the more I think about it, the more it makes sense to me to reduce costs and save money. Our culture has turned away from saving and from being prepared for the future. The recent downturn should have us reconsidering the wisdom of many of the decisions we’ve made.