According to leading Australian demographer Mark McCringle, the average Australian household size has been on the decline for the last 100 years. Not only has the traditional nuclear family been getting smaller in size, but both single-parent and sole-person households are also on the rise. By next year, the traditional nuclear family will no longer be the largest category, with couples under one roof taking over from couples with children as the dominant demographic. One in four households are now solo-person households, with one in ten being single-parent households.

There are many reasons for this ongoing decline, with couples delaying the choice to have kids and many couples deciding not to have children at all. The average age for people to start a family has risen over the last few decades, from the early 20s in the 1950s to the early 30s today. The other factor helping to shrink the size of Australian and New Zealand households is the ageing population of both countries. The number of people aged 65 and over has doubled in New Zealand since 1980 and will double again by 2036, with more people living out more of their lives after their children have left home.

While the household norm of mum, dad, and 2.2 kids may be shrinking in some situations, however, another growing household demographic threatens the nuclear norm in an entirely different way. Multiple generations of Australians are now more likely to live under the same roof, with baby boomers sometimes called the "sandwich generation" due to their relationship in-between their parents and kids. Baby boomers often look after both their children and their parents under a single roof, with young people living at home for longer and returning home more often.

According to recent figures, 23 percent of young people aged between 20 and 34 continue to live with their parents, either never leaving home or moving back home after time away. This percentage is even higher in Sydney and Melbourne at 27 percent, with more expensive locations seemingly making it harder for young people to afford rent and mortgage commitments. While increased social interaction and strong family ties are a definite advantage to this kind of lifestyle, there are a number of financial and cultural challenges also posed by multiple generation households.

While the traditional nuclear family will never go away, the changing nature of household demographics does raise a number of important issues. From affordable housing for young people and sole-person households through to more flexible housing options for extended families, it is important that we can meet the demands of what is an increasingly diverse society.