Monday, August 27, 2012

Household size and economies of scale, part 1

A couple years ago while hanging out in the basement of Synergy Co-op in Palo Alto, my friend Xander and I were talking about co-op living.  Xander brought up that of various economic indicators, household size is rarely studied. It's an important topic though, as every other aspect of human organization and economic life has seen a trend towards consolidation, whether it be businesses, government, or nonprofit organizations.  These businesses and organizations benefit from economies of scale, which provides buying power, insurance against random events, and political power.  Why not households?

Some Statistical Background

Currently, the average US household is around 2.6 people.  This is actually a bit higher than most industrialized nations.  Back in the 1930s it was around 3.7.  The Census defines households as follow:

A household includes all the persons who occupy a housing unit. A housing unit is a house, an apartment, a mobile home, a group of rooms, or a single room that is occupied (or if vacant, is intended for occupancy) as separate living quarters. Separate living quarters are those in which the occupants live and eat separately from any other persons in the building and which have direct access from the outside of the building or through a common hall. The occupants may be a single family, one person living alone, two or more families living together, or any other group of related or unrelated persons who share living arrangements. (People not living in households are classified as living in group quarters.)

This excludes group quarters, for which US census data is available here (PDF).  Currently 8.3 million Americans report living in group quarters.  Of these, prisons & jails make up 2.2 million, nursing homes 1.8 million, and college housing 2.4 million.  Total of these 3 largest groups = 6.4 million, the remaining1.9  include juvenile halls, homeless shelters, monasteries, barracks, group homes, worker camps, and other institutional housing. 

Key elements of the definition of a housing unit:
- Has direct access to outside or a common hall (i.e. you get your own key)
- People within that housing unit eat separately from other people not in that unit. 

- In a rooming house or residential hotel without shared meals, each room is a separate housing unit.
- Student co-ops are classified as group housing.
- A non-student co-op house such as Fort Awesome is classified as a single household.
- Cohousing where residents live in separate units is classified as separate households, even if residents eat meals together.

Why this matters - public policy on housing:
Housing goals in public policy are often defined in the number of units (houses or apartments, regardless of size).  Incentives are often given to maximize the number of units built.  However, what's actually important is the number of bedrooms... or perhaps the number of beds*.  It is much cheaper to build a 3-bedroom apartment (1000-1200 square feet) than to build three 1 bedroom apartments (500-600sf each for a total of 1500-1800sf).  Likewise the bigger apartment is also cheaper to heat and cool and maintain.

Affordable housing often gets criticized for its high per-unit costs vs. market rate apartments.  However, market rate apartments are typically studios, 1 bedrooms, and 2 bedroom units.  Affordable housing apartments often have a majority of 2 bedroom and 3 bedroom units.   Often funding requires a minimum of the units (20-33% is typical) to be 3 bedroom or larger. 

*Xander also mentioned once that the number of mattresses can be correlated to the amount of fascism in the country, as more mattresses means that people aren't sleeping together. 

The flip side: Except in college towns like Berkeley where group living in a house is common, most cities such as San Francisco do their zoning by counting kitchens.  When an area is said to allow a maximum density of 10 units per acre, it means that at most 10 kitchens are allowed.  When the planning code says one parking space is required per unit it means that one parking space per kitchen is required (this actually makes some sense even in the co-op context).  Typically 5 bedrooms is the maximum viewed by planning codes as still falling under the category of "dwelling unit" as opposed to "group housing".  Example in SF Planning Code

Architectural Efficiency
Apartment buildings designed to have lots of 5-bedroom apartments would be somewhat different than those made up of mostly studios and 1&2BR's.  The building would be the same size as in most urban areas height limits are the main limit to building's size.  Less of the building would be hallway or parking, making it a more profitable building.  The number of bedrooms (and therefore residents) would be double than that of a building made up of 1-bedrooms.  Imagine if the price of housing in SF dropped in half! 

While it's true that out in the suburbs there are often 5-bedroom houses with 2 people living in it after the kids move out, this would be a non-issue in a co-op environment, where household size naturally increases to fill all available bedrooms.

Outside of old Victorians with three stacked apartments, I don't know of any examples of apartment buildings with large units.  Perhaps I shall sketch one out sometime...

That concludes Part 1.  In Part 2, I'll discuss what widespread co-op housing means for food systems and the division of household labor.