Posted by: Josh Lehner | June 18, 2019

On the Rise: Single-Person Households

The other week The Wall Street Journal had a fascinating article on the rise of single-person households and how companies are offering and redesigning products to better meet the needs of individuals rather than those of, say, a family of four. Research and consumer spending shows that individuals are willing to pay more per ounce of condiments in a smaller bottle than to buy the giant bottle. Similarly, the warehouse club package of toilet paper is not the right size for a household of one, even if it technically provides the best bang for your buck. Do read the article as it has great information regarding how demographic shifts impact businesses, open up new market opportunities and the like.

However, while the article does try to provide a demographically-balanced tone, I was struck by the primary focus being on young, urban individuals. This may be because they are the most lucrative market opportunities for businesses or that they play a key role in population growth in close-in neighborhoods. Plus, telling the story of financially independent and seemingly successful individuals is overall a positive lens to view demographic and societal changes. But there’s just one issue with this framing. There are more single-person Baby Boomer households today than Gen X and Millennials combined. Talking about delays in household formation, marriage, and births is all well and good and I am guilty of this all the time. However, focusing just on these trends can really misses the forest for the trees.At some point near the middle of the century, single-person Millennials households will overtake their older neighbors in absolute terms, but not for decades to come. The biggest reason for this is where each generation is in their life. In the decade ahead, Millennials will be in their peak family years, or when the share of single-person households is at their absolute lowest. Gen X will begin aging out of their peak family years and into their empty nest years. While Baby Boomers will see an ongoing rise of single-person households, largely due to unpleasant conversation topics including a growing number of divorcees, widows and widowers.

Another factor at play for all ages is the trade-off we face when it comes to housing costs and personal space. It is cheaper to live with roommates, but if we can afford it, we do tend to prefer a bit more privacy and the like. Living by yourself certainly does not have to mean social isolation.

These shifts will have tremendous impacts on the economy and society at large in the decades ahead. More families increases the demand for childcare and education, for example. And a growing number of older households increases demand for caregivers, social workers, assisted living facilities and the like.

But these shifts also have big impacts on housing markets.

  • If we look at the past decade, the growth in single-person households aged 55 or older accounts for 1 out of every 2 new households in Oregon, if we net out the changes across demographic groups. In the Portland region, they account for 1 out of every 3 new households.
  • Our advisors in recent years have noted if you look internationally at places with older population, housing demand actually increases due to changes (declines) in household size.
  • We are clearly seeing this today. Over the past decade the change in the share of older single-person households is equal to 2-3 years worth of new construction in Oregon. As such, supply needs to increase more than it has in the past to account for aging demographics. Offsetting this somewhat, however, are lower household formation rates among younger cohorts.
  • Like society at large, most single-person households are homeowners. According to the American Housing Survey, in the Portland area the average single-person homeowner aged 55 or older lives in a 3 bedroom house they moved into in the late 1990s.

All of the above has led some to conclude that we do not need any more single family homes. We just need to better allocate our existing single family homes to match the needs of households. I, personally, do not believe the first part. Surveys and buying habits continue to show a lot of people do want single family homes. However, I am also on the record noting that one of the benefits of missing middle housing is it better allows aging in place. The way this happens is more options within existing neighborhoods and communities means households and individuals can right size their housing type as their needs change without severing social ties. This is of particular interest because we know that the vast majority of people do not currently downsize; they live in their home until they pass, or move to an assisted living facility in their 80s or 90s.

Finally, a few months ago we had an advisors meeting that focused primarily on homelessness and we were able to bring in speakers to address and educate us on the issue. One of the ideas advocated for and discussed at that time was the concept of providing a property tax incentive (rebate/discount) for someone who shares their home with, or provides a room to a low-income neighbor. The idea being it could be a win-win in the sense that it would open up more housing units for lower income residents to live, and could financially assist homeowners struggling to make ends meet. I know this concept is currently being discussed in the Legislature and our office is not advocating for or against any particular policy. However given it was a topic of conversation in a recent meeting and ties in conceptually with the growing number of single-person households, I just wanted to highlight it as one possibility.


  1. […] Source: On the Rise: Single-Person Households | Oregon Office of Economic Analysis […]

  2. […] First, at the end of this decade all Millennials will be in their 30s or their 40s. It is much more likely they will have their own kids than be the punching bag about how kids these days don’t walk uphill both ways, or something. But this transition from one’s 20s to their 30s and 40s brings about big shifts in one’s life. In the decade ahead, Millennials will fully transition through their root-setting years. This is when you settle down, begin your career in earnest, get married, have kids, buy a house and the like. And while long-run societal shifts means young adults today are getting married later, having fewer kids and at older ages, these big picture milestones are still common even as single-person households are on the rise. […]

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