Houses in our neighborhood in non Bay Area Northern California sell in days between 600-800k. They’re average sized 2700-4000 sq ft homes nothing too fancy. Guess it really depends on the area.
Houses in my neighborhood sell in days even though they are generally 3 bedrooms, bath and a half, maybe a shared driveway, what is considered a bad school district ( although my kids went there and did fine.) Why? Because it’s close to downtown, walking distance to grocery, restaurants, coffee, library. Public transportation isn’t great but exists. Oh, and it’s far from either coast and a really nice house might cost you $300K. Actually we bought for $80K here thirty years ago so if we could sell for $300K that would be nice. But then, where would we go?
I live in an area with large homes in a high COL area. The people buying are generally not who I would call “young.” Recent college grads generally do not buy traditional homes in my high COL area, including those who are married. Some rent apartments or buy/rent smaller condos. Condos have replaced the traditional “starter home”. Sharing houses/condos or renting a room of a house also are relatively popular.
The people who move in to larger houses in my area usually fall in to two categories. Most are families with middle aged parents (often in 40s) who have enough kids to fill most/all of the bedrooms. A minority are older, retired couples. I am the only single person I’ve ever known to live in my immediate area and was the youngest I’ve heard of, when I moved in.
Being older, many have worked for decades and have had time to accumulate savings for a down payment. Many also are dual income families. Many have professional jobs. Many also made a large gain on some of their previous homes during the various real estate booms, particularly older persons. Persons who bought their first home decades ago at more reasonable prices often have made huge gains, which can be used to finance future homes.
Well…I’ll let you know what happens in my neighborhood soon. Other houses that are 4 bedroom with 2 1/2 baths on 2 acres have sold very quickly. One will come on the market soon that is 5 bedrooms and 3 1/2 baths. Very very nicely updated. It’s the largest house on the road. I’m hoping they get what they ask for it!
My parents’ very large house is about to go on the market. It’s expected that someone will buy it for a ridiculous sum of money and then tear it down to put an even bigger house on the lot. 
My folks bought the lot in 1972 for $5,000.
In northern Wisconsin we put a rental home up for sale earlier this month and had an accepted offer within days - for $50K more than we were asking 8 years ago!
Lenders generally do require PMI (or the equivalent by raising the interest rate) for less than 20% downpayment (more than 80% loan/value). Obviously, PMI and the larger amount financed increases the ongoing cost of paying the mortgage, which can make the house unaffordable for those same new house buyers who do not have the 20% downpayment.
I live in Howard County, Maryland, close to 95 and about halfway between DC and Baltimore. Unfortunately we purchased our roughly 2500 sf home (plus a full basement - I don’t think that’s considered in SF) on close to an acre of land in 2006, which is just before housing started to crash around here. We would be lucky to Get 50K LESS than we paid for the house back then. Unfortunately the houses about doubled in price in the early 2000s, and then went down right after we bought. Our house was once listed for over 100K more than we paid, so I guess I should be happy we didn’t pay that. My neighborhood has never really recovered, but it has come up a little in the last couple of years.
I live in a high COL beach community. The only house in my neighborhood for sale is $869K and is probably about $25K over priced. Our area is walking distance to shops, restaurants, movies and in 2 years we will have a trolley line we can walk to. School district is excellent and we are near a major university. My older D is the same age I was when we bought our place and there is no way she will be able to afford a home anytime soon on a teacher’s salary in SoCal.
I have to say after reading all these posts I feel like I want to say, “hey, come check out the midwest!” Buy more for much less and probably sell without losing the bank! (understood that some areas of the midwest like Chicago suburbs prices are still high but there is a lot of ground between living in the corn fields and living in a pricey affluent midwest suburb!!
As somebody upthread asked, how big is big? Over 3,00 sq-ft or 5,000 or 10,000?
I downsized and sold my large house at the first showing and had interest before it even went on the market. Big houses are the norm here though.
I don’t consider 2500 or 3000 sq. feet to be “big.” They are not small, but big? Not to me. It is subjective of course. I think 5000 or larger would qualify.
In my neighborhood, we live in the “zeroes” section-4000 to 7000 sq. feet homes on small lots, so very little yard to have to maintain. We are considered the “small houses,” bought by people wanting to downsize (we downsized in terms of yard and number of bedrooms, not so much on sq. footage). The other section of the neighborhood is made up of 1-3 acre lots with 8500-12,000 sq. foot homes. They are called the “estate homes.” Yep. All relative.
My town required new construction homes bigger than 5,000 sft to have automatic fire suppression systems. It can add $100k to the home construction cost with little perceived value to the buyer. I guess 5,000 is “big” here. 
There is a lot of new, fancy construction just under 5,000 sft. I still consider those 4,000 sft plus houses huge.
@BunsenBurner, that Lake Washington Home you linked was just under 5000 ft I think. Loved the views but not the price.
http://www.aei.org/publication/new-us-homes-today-are-1000-square-feet-larger-than-in-1973-and-living-space-per-person-has-nearly-doubled/ says about new house sizes in 1973 and 2015:
1973: median 1,525 ft^2, average 1,660 ft^2, average 3.01 people per household, average 551 ft^2 per person
2015: median 2,467 ft^2, average 2,687 ft^2, average 2.54 people per household, average 1,058 ft^2 per person
This reminds me of threads where people don’t think they are rich.
This is all very geographically specific and dependent on COL.
It cracks me up that someone may not think of a house that’s over 3,000 sq as big. Just how much room does the average American household of 2.53 persons need?
House size “needs” would vary a lot depending on several factors.
We are looking to make a move. But DH offices out of home and needs a large space to accommodate all of his aerial maps and conference table, other office stuff, etc. I have found that houses that have that kind of space seem to be surrounded with a whole lot of house, a good portion of which we don’t need (formals in particular).
Also, what seems big or little can be highly relative to other properties in the vicinity.
I grew up in an 1800 sq. foot house. It seemed pretty small, but there were six kids in our family. I don’t remember feeling crowded in the sense of bathroom space, however, which seems really odd in retrospect. Maybe I just have forgotten that part of the experience.