Newly released data from the US Census Bureau has just revealed that the average household size is increasing for the first time in over 160 years. Put differently, the formation of new households has started to trail overall population growth. And that is causing the average number of people per household to increase.

In 1790, there were about 5.79 people per household in the United States. That number has been in decline pretty much since then, though there was a slight increase in the decade that began in 1850. Last year (2018), the number grew to 2.63 people per household (2.71 for owner occupied households and 2.48 for renter occupied households).

Here are two charts from Chris Fry's recent piece at the Pew Research Center:

So what is causing this?

Well, we know that US fertility rates aren't on the rise. In fact, they're generally viewed as hitting record lows. I say "generally" because there are a number of different ways to measure fertility. There's the general fertility rate, completed fertility, the total fertility rate, and others. But we are seeing some alignment here: fertility rates are down.

One probable explanation is the fact that more Americans are living multi-generationally. According to the Pew Research Center, 1 out of every 5 Americans lived in such a household as of 2016. Part of this may be a result of immigration. Asian and hispanic populations are more likely to live in a multi-generational household compared to white people.

Another demographic trend is the increase in people living in shared quarters, whether that might be with a roommate or someone else. This is interesting because it suggests that there's an affordability constraint. Are people being forced to "double up?" The current co-living trend is at least partially because of this.

These are all noteworthy trends because household formation is viewed as "the underlying driver of long-term demand for new housing." I am assuming that more people per household also means less square footage per person.

Graphs: Pew Research Center

The percentage of single-person households in the US has been steadily increasing since the 1960's (though the rate of increase has moderated in recent decades). As of last year (2018), 28% of Americans lived alone, according to the US Census Bureau. So about 1 in 4 households. This is in comparison to 13.1% of households in 1960.

Here is a chart from a recent WSJ article on the topic:

Not surprisingly, this is changing how marketers target households. Affluent, single-person households in urban areas have proven to be a boon to product makers because they tend to spend more per person and they tend to value time > money. Of course, this phenomenon also has implications for those of us who work as city builders.

For more historical household tables from the US Census Bureau, click here.

If you check out the “What I read” page that I recently added to Architect This City, you might notice a blog by Charlie Gardner called the Old Urbanist. I discovered it a few months ago (when he added ATC to his blog roll) and it’s good stuff.

Last week he posted this interesting piece comparing homeownership rates and house sizes in both Mexico and the US. His finding is that there’s a fundamental mismatch in America in terms of the size of housing and the size of households. One and two person households now represent more than half of the market, and are on the rise, and yet 40% of houses in the US have 3 bedrooms.

Because of this mismatch, he’s arguing that households are being poorly served by the US housing market and that it’s driving down homeownership levels. It currently sits around 65%, which is a drop from over 69% during the mid 2000s. Contrast this to Mexico, where there’s a greater number of one and two person households and the homeownership rate is 80%! Oh, and where only 6% of homes are financed using a mortgage.

So what the Old Urbanist is suggesting is that we need to embrace smaller homes. He doesn’t explicitly say it, but he mentions the opportunity to redevelop laneways and alleys, which many of you will know I fully agree with. It’s a great post and I suggest you have a read if this topic interests you.

Newly released data from the US Census Bureau has just revealed that the average household size is increasing for the first time in over 160 years. Put differently, the formation of new households has started to trail overall population growth. And that is causing the average number of people per household to increase.

In 1790, there were about 5.79 people per household in the United States. That number has been in decline pretty much since then, though there was a slight increase in the decade that began in 1850. Last year (2018), the number grew to 2.63 people per household (2.71 for owner occupied households and 2.48 for renter occupied households).

Here are two charts from Chris Fry's recent piece at the Pew Research Center:

So what is causing this?

Well, we know that US fertility rates aren't on the rise. In fact, they're generally viewed as hitting record lows. I say "generally" because there are a number of different ways to measure fertility. There's the general fertility rate, completed fertility, the total fertility rate, and others. But we are seeing some alignment here: fertility rates are down.

One probable explanation is the fact that more Americans are living multi-generationally. According to the Pew Research Center, 1 out of every 5 Americans lived in such a household as of 2016. Part of this may be a result of immigration. Asian and hispanic populations are more likely to live in a multi-generational household compared to white people.

Another demographic trend is the increase in people living in shared quarters, whether that might be with a roommate or someone else. This is interesting because it suggests that there's an affordability constraint. Are people being forced to "double up?" The current co-living trend is at least partially because of this.

These are all noteworthy trends because household formation is viewed as "the underlying driver of long-term demand for new housing." I am assuming that more people per household also means less square footage per person.

Graphs: Pew Research Center

The percentage of single-person households in the US has been steadily increasing since the 1960's (though the rate of increase has moderated in recent decades). As of last year (2018), 28% of Americans lived alone, according to the US Census Bureau. So about 1 in 4 households. This is in comparison to 13.1% of households in 1960.

Here is a chart from a recent WSJ article on the topic:

Not surprisingly, this is changing how marketers target households. Affluent, single-person households in urban areas have proven to be a boon to product makers because they tend to spend more per person and they tend to value time > money. Of course, this phenomenon also has implications for those of us who work as city builders.

For more historical household tables from the US Census Bureau, click here.

If you check out the “What I read” page that I recently added to Architect This City, you might notice a blog by Charlie Gardner called the Old Urbanist. I discovered it a few months ago (when he added ATC to his blog roll) and it’s good stuff.

Last week he posted this interesting piece comparing homeownership rates and house sizes in both Mexico and the US. His finding is that there’s a fundamental mismatch in America in terms of the size of housing and the size of households. One and two person households now represent more than half of the market, and are on the rise, and yet 40% of houses in the US have 3 bedrooms.

Because of this mismatch, he’s arguing that households are being poorly served by the US housing market and that it’s driving down homeownership levels. It currently sits around 65%, which is a drop from over 69% during the mid 2000s. Contrast this to Mexico, where there’s a greater number of one and two person households and the homeownership rate is 80%! Oh, and where only 6% of homes are financed using a mortgage.

So what the Old Urbanist is suggesting is that we need to embrace smaller homes. He doesn’t explicitly say it, but he mentions the opportunity to redevelop laneways and alleys, which many of you will know I fully agree with. It’s a great post and I suggest you have a read if this topic interests you.