Why don't small households live in small dwellings?--Disentangling a planning dilemma.

Advocates for the compact city often suppose that smaller households mean people will want smaller dwellings. This paper analyses the growth in lone-person households in Australia and shows that most people who live alone prefer detached three-bedroom houses and that many of them are able to realise this preference. Planners have too readily assumed that the demographic shift to smaller households will facilitate a shift to more compact cites. There is very little evidence to support this assumption.

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In 2001, approximately one quarter of Australian households contained a single person and by 2021, the figure is expected to be closer to one-third. (1) Some 35 per cent of the additional 464,000 households recorded in Australia between the 1996 and the 2001 census years consisted of one person. Indeed, in the ten years between 1991 and 2001, Australia's population increased by 12 per cent while the number of households increased by 21 per cent. (2) This differential stems largely from the proliferation of smaller and smaller households.

This trend towards small households has not gone unnoticed by planners. Under the banner of urban consolidation, compact cities and/or smart growth, several Australian state government metropolitan planning strategies promote a radical shift in the character of Australia's dwelling stock away from single-detached dwellings towards medium to high density. (3) By achieving higher housing densities, these planning policies aim to address a number of pressing urban problems believed to be related to urban sprawl--high infrastructure costs, excessive car use, serious air and water pollution, lack of housing variety, and declining housing affordability.

With about three-quarters of all dwellings in the form of three-bedroom separate houses, (4) Australia's housing stock has been described as a 'rigid stock of dwellings designed for the traditional nuclear family'. (5) Given the demographic trend towards smaller households, it has become commonplace within housing and urban policy circles to discuss the need/demand for alternative housing forms, particularly medium to high density. Yet there is little evidence of a shift towards smaller dwellings by small households. On the contrary, paralleling the growth in the numbers of small households, new private sector houses, on average, have been getting larger in size. Between 1992 and 1999, the average size of new private sector houses in Australia increased from 187 to 215 square metres or 15 per cent, even though the average number of persons per household remained constant at 2.6 persons. (6)

Table 1 illustrates this apparent contradiction by showing the declining number of residents per dwelling between 1971 and 2001, alongside increasing proportions of dwellings with three or more bedrooms. In 1971, for example, 64 per cent of Australia's dwellings contained three or more bedrooms. Between 1971 and 2001, when the share of households with one or two persons rose from 40 to 57 per cent, the proportion of dwellings with three or more bedrooms increased substantially to 74 per cent of dwellings.

Is it reasonable, therefore, to assume that the trend towards smaller households means that in the future we will need a more diverse stock of smaller dwellings? And is providing smaller dwellings a solution to the serious environmental concerns associated with our low density suburbs of separate detached dwellings? The decline in household size is well supported by demographic data. But will people who decide to live alone or who find themselves in this situation due to marital breakdown or widowhood seek smaller dwellings? This issue is far more complex. People's housing decisions are multi-faceted, based on their current and future needs, and intermixed with aspirations about dwelling forms, owning or renting, location and neighbourhood, and affordability. Each of these decisions is constrained or enhanced by the level of household income. In sum, housing preferences are shaped by a combination of macro level factors (housing market, housing system, economic climate) and micro level factors (age, household composition, income and current housing situation). (7) In this paper, we profile the demographic and housing characteristics of single person households in 1981 and 2001 in order to assess any evidence of a shifting preference for smaller dwellings.