Case Study on the Need for Regulation

I’ve been following the discussion in Melbourne over the last few years with the rise of McMansion suburbs featuring large household buildings.  Being the owner of a fairly modest 14,500 square foot home, I found it difficult to understand why it was necessary to have 4 bathrooms in a house for only a couple of people.  During some futures workshops, one issue that kept reappearing was a potential backlash from people who have these places but not the funds to afford energy costs in heating and cooling as well as limited access to available public transport.  A related issue was the forecast of a relative increase in upgrading and retro-fitting existing households over building new ones.

And so it was interesting to see this release from the American Institute of Architects showing that there is a renewed interest in smaller house sizes and upgrading existing homes to make more use of the available area.  Partly this is due to belt-tightening by residents but also an enhanced interest in environmental issues and reducing energy costs.

This raises the issue of the need for regulation, especiallyin the good times, and the potential failings of letting market forces rule alone.  In this case, having regulations that required households to improve their energy efficiency preceded the demand of residents for these measures.  Of course, this also needs to be balanced with the removal of older regulations that are at odds with community sentiment.


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