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The new philosophy of the shell-shocked housing industry: "Small is beautiful." Industry spokesmen foresee costs being chopped all along the line, from a drop in the value of timberland to the price of a single-family home. Smaller houses will be built with wood procuts from smaller, cheaper varieties of trees. For its part, the American Plywood Association has come up with what it considers very practical and liveable designs for homes containing from 1,000 to 1,500 square feet of space. The average home sold in 1981 has 1,750 square feet.

"Everyone would like to live in a 3,000 square foot home," says a spokesman for the plywood industry. "But the move is on for smaller houses and better use of expensive land."m

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