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I built a house last year, and had to work with a few different banks to finally get a construction loan. One of the fist ones said to me "1900 sq-ft? You shouldn't be building a house that small".

We made it work, but would have gone with a manufactured home before we would have built something with 3k+ square feet just to make the bank happy.

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I would assume the first bank advised against it, and the other banks passed on it, is because they need to think not only about whether you can be expected to repay the loan, but also about how easy it is going to be to offload the property if you can't afford the loan and they need to foreclose.

Yes, YOU might be perfectly happy in a 1,900 square foot home, but if the market demand is for houses significantly larger, then you, or the bank, might find it (relatively) hard to find a buyer if you ever need to sell.

I was about to say the same. I know someone in the Salt Lake City area who built his own home. His realtor told him "You can build what you want, but a house with 4 bedrooms will not sell well".

People have a lot of kids there.

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