Homes in the past have usually been multigenerational, and it made sense. There would be someone at the house at all times to tend children, no gobs of money lost on day care. Old people would have someone to take care of them and wouldn't have to be sent off to expensive, abusive, and untrustworthy convalescent homes to rot. It's always cheaper to cook for more people.
Of course, this made more sense when populations weren't very as transitory and often just inherited their family's business or simply became an apprentice in the same trade. It's really only a modern invention, each new family of four buying a new house for itself. Why do we need all that space?
Keepin' up with the Jones's.
It's simply better for our economy to have as few people as possible in a household so that we have to buy more appliances, more food, spend more on utilities, take out more loans, and send off our children to live somewhere else when they're older. And when we die, they'll inherit our old houses and immediately sell them to the next expanding family.
But that's only the nicest of stories. Often families never finish paying off their houses, and just keep moving and moving with each new job or whim. "I want a room with a bigger garage" or they remortgage it to buy a ski boat or pay for their children's college. Or if people do fully own their house, their property is seized by nursing homes to pay past debts.
But it's not like the bank has a gun to our heads and sits us down at the loan officer's desk. We like our privacy and our space and our things. Who wants to take care of an aging, drooling, nagging, smelly parent? Who wants to be told how to raise their children by the other people in the house? Who wants to clean up after someone else's children?
I don't know anyone who does. But I do know that people shouldn't feel compelled to live in a standard fashion because a society controlled by an economy tells us to.
There are people over at my house nearly every night. I've got many good friends who are like family. They're like family because I've known them for so long; we have a history and a lot of forgiveness because I like to think we actually love each other. But it's more than that: each person that comes over is intelligent, good-humored, witty, and kind-hearted.
That doesn't mean I'd want to live with them all the time, but it's damn near close already so why not explore the possibilities?
There would be problems of course, especially since when you live in close proximity to other people, drama takes on a yeast-like quality. But if you set it up right so that you could have privacy and seclusion time (a difficult feat) then it might be worthwhile.
I need my privacy just like everyone, but the house could be designed to foster privacy in certain areas. Or it could be how my family's farm is right now with separate buildings just within a close enough proximity to help each other out when needed.
My father's family lives on a farm with several houses. The main house is about 120 years old where my grandparents live. About 150 yards away is my Aunt Alethea's house where she and her three children live. They're all grown, but two still live there, and often one of the children will go live with Papaw and Gamaw for a time to escape their siblings or to help Papaw (or previously, our great aunt Laura) get around (they did the same thing when they were younger, too).
They share meals, not all the time, but often. Another aunt, Aunt Margaret, and her family live across the highway (all within walking distance). Even my older brother, Hayden, 34, just moved back to the farm. People have lived away for spells but there's always a place or a willingness to build a place for you to move back. The whole family has always been a bit clannish. If my grandmother had her way, all her little chickens would be within the radius of a mile.
See frolicswllamas's post and navydave's post about similar topics.