For decades, American houses got bigger while family sizes got smaller. But lately, there's been a shift. As the economy soured, more extended families began sharing space -- whether it was unemployed young adults moving back with their parents, or financially strapped senior citizens moving in with their children.

Author Michael Litchfield thinks this trend will continue, as Americans increasingly question whether they're making the best use of their space. In his new book, "In-laws, Outlaws and Granny Flats" (Taunton Press, $24.95), he shows how to create secondary living spaces -- also called in-law units, granny flats and accessory dwelling units.

Q Describe some of the second-unit projects in the book.

A I'll go from the simplest to the more complex: The carve-out is basically when you appropriate a couple of rooms and a bathroom, and you pretty much just need to add a kitchenette to make it an autonomous living space. That's really good for a caregiver or an elderly relative you want to have close. It's less good for a rental unit because there are privacy issues.

A basement is another option. If you've got a damp basement, it's probably a good idea to consider other alternatives. But if it's a dry basement and you've got enough headroom -- usually about 7 feet 6 inches is required by code -- and especially if your house is built into a hill where you've got a large wall that could be used for windows to get light in, that's a really good situation. In basements or any in-law unit where you're sharing a wall or a ceiling, you have to be concerned with soundproofing. Then there are bump-outs, that's sort of like a carve-out, with another room attached to the house.

Q Sort of a small addition?

A Exactly. That can be a very cost- effective way to go because you're taking advantage of existing framing and maybe sharing a wall or two. It eats up less of your back yard. Garage conversions are very popular. They're separate from the main house, so you've got good privacy. Also, garages tend to be minimally framed or unfinished, so you don't have to tear out a lot of stuff.

Stand-alone cottages are probably the most flexible space in terms of who you can rent it to or put in there. But they can eat up a lot of your back yard. If you have a medium to large lot, they're a great way to go.

An attic conversion is probably best for someone who's a relative or someone who's young, because stairs are an issue. Sound is also an issue. If the attic was originally framed to be a living space, then you're probably OK, but if not, it can be a very expensive and disruptive way to go.

Q As baby boomers age, will second units become more popular?

A Oh, absolutely. The baby boomers are going to want to age in place and they're going to need health care. I think the AARP said it's about a third of the cost to care for someone at home or in a community-based setting, as opposed to an institutionalized setting.

Q What's the minimum amount of space required for one of these units?

A Local zoning codes are going to determine minimum and maximum sizes, but my feeling is that if they're carefully designed, 350 to 400 square feet can work.

Q What are some of the tricks to making such a small space livable?

A If you're working with a small footprint, it's really a good idea to have high ceilings. Somehow, that increase in volume just makes it feel bigger. Lots of natural light is also really important. It's a more cheerful space, and if you're incorporating the outside in your view or as a patio or deck, that gives you the sense of more space. Also, furniture with multiple functions -- such as a window seat or dining bench with storage underneath -- is another good space-saver.

Q You have a quiz in the book with questions like, "How many siblings did you grow up with?" Why did you include the quiz?

A Even if a person has a compelling economic need to build a rental unit, if it's not right for you, it's going to make you unhappy and your tenant is not going to feel at home. This personality test is an unscientific way to get people to think: Will this really suit your temperament?

Q Does your work share some of the principles of Sarah Susanka's "Not So Big House" books?

A I do think we're going in the same direction. She speaks about her "Not So Big House" phenomenon as being a reaction to the soullessness and literal emptiness of the McMansions. I think America has a huge amount of unused space, of houses that aren't being used flexibly and cost-effectively. I'm thinking of a single person or couple rattling around a 3,000- or 4,000-square-foot house.

The book is asking people: You've got this enormous house; is it doing all you need it to do? Might the space be put to better use, either as a home office or to put up your boomerang kids or to provide a place for a caregiver? America probably has 30 million to 40 million seriously underutilized homes. I don't think most people can afford to be this wasteful.