As demographics change and households take on different configurations, so will our homes, writes Harvey Grennan.

We can no longer make any assumptions about a family being a nuclear arrangement of mother, father and kids living under the same roof. As of this year, Australia has more couples, young and old, living without children than with them.

Lifestyles and family composition are changing. Households (but not houses) are shrinking. In 1911 there were 4.5 people for every home. By 2006 it had dropped to 2.6 and by 2026 the number is likely to be just 2.3, according to the Australian Bureau of Statistics, which also provided the following statistics.

An ageing population means that in 25 years, nearly one third of all Australian households will consist of a single person. In 2011 the number of people over 75 was 1.1 million; by 2026 it will more than double to 2.5 million.

At the other end of the age scale, the number of children under 14 is projected to decline from 4 million in 2001 to 3.8 million in 2026. Meanwhile, the number of children living in one-parent families could double. It's predicted that kids will be staying at home longer, too, with 40 per cent of those between 15 and 34 years of age still living with a parent.

While fewer people are living in each dwelling, paradoxically, houses are getting bigger. In Sydney the average new house is around 260 square metres, up by 100 square metres since 1984. Twenty years ago one in six homes had four or more bedrooms; now it's closer to one in three. Typically, two of those bedrooms are not used.

While we are living in the biggest homes in the world, another paradox is that we are not building enough of them. According to the Housing Industry Association, we are building about 20,000 too few houses each year to meet current demand, and home-building is actually expected to decline this year.

What do these figures mean to the future of the Australian housing market? First, a chronic undersupply of new housing means predictions that house prices could fall by up to 25 per cent, made by bodies as eminent as the International Monetary Fund, are highly unlikely to materialise. Second, with up to 3.7 million single-person households by 2026, there'll be greater demand for studio and one-bedroom apartments and for retirement units. The banks will have to shed their reluctance to lend on smaller apartments. Finally, architects, builders and developers need to adjust to the fact that 'family' is no longer a one-size-fits-all concept.

Household accounts

Projected changes in Australian households (ie any self-contained living) from 2001 to 2026:
In NSW, the number of households is expected to increase by 33-38 per cent and the number of women living alone by up to 81 per cent.

The number of households in Victoria will rise by 35-41 per cent, with family units increasing more slowly than in the rest of the country.

In Queensland, the number of lone-person households will leapby between 87-153 per cent.

Household growth in South Australia will be the second slowest at 17-26 per cent. Already, childless couples are the most common family type.

In Western Australia, one-parent families will increase more rapidly than in Australia overall.

Tasmania will have the smallest households, with an average of just two people in each.

Source: Australian Bureau of Statistics