As our society grows and evolves, the housing market does as well. The prevailing trend in American housing over the past few decades has been single-family homes, illustrating the value Americans place on independence and privacy. That trend seems to be shifting, however, as more people opt to live with family members in multi-generational housing.
According to a survey from John Burns Real Estate Consulting, as many as 41% of American homebuyers make considerations like housing an adult child or aging parent when looking at homes.
With more buyers seeking out multi-generational homes, it is increasingly important for real estate agents to understand the ins and outs of this unique niche. We've outlined everything you need to know about multi-generational buying trends below.
Although the desire to share your home with extended family members may seem unusual to many folks, there are numerous reasons why many American homebuyers are considering making the switch.
With the price of homes on the rise, multi-generational living provides an option to pool resources. Also, for many millennials, high rates of educational debt sometimes make it necessary — or at the very least, more practical — to live with their parents rather than purchasing their own home. In 2019, 47% of younger millennials indicated they carried student loan debt, creating a significant financial barrier to homeownership on their own.
Buyers may also have emotional and cultural reasons for pursuing multigenerational living options. For one, many people today feel increasingly socially isolated. Moving in together may be an attempt for some to regain a sense of community in a society that can sometimes feel disconnected.
Additionally, families of many cultural backgrounds place a high value on multigenerational living. Hispanic and Asian households in the U.S. are leading the trend, with 29% of Asian Americans living in multigenerational households as of 2016. As the U.S. continues to grow more diverse, researchers anticipate that multigenerational living will only become more popular.
It's not surprising to see an increase in the number of homebuyers considering multi-generational homes when you acknowledge the many benefits. From a financial standpoint, families living in multi-generational homes can split utility and grocery bills. They may also have an advantage when it comes to securing a home loan, where an increased or steadier income is certainly a bonus.
Another financial benefit to multi-generational living is cutting out childcare costs. For many parents, the idea of freeing up a chunk of their budget by having a live-in grandparent or other family member provide childcare is an incentive. Family members living under the same roof can also enjoy more time spent together, strengthening their bond as a result.
Finally, many multigenerational families want to create a living situation where elderly relatives can receive care without leaving the home. In fact, about 80% of people over 50 say they would add to their existing home or look for an attached residence to care for these family members. This has both financial and psychological benefits for tight-knit family units, as transitioning to an assisted living center is not the ideal solution for everyone.
Still, there are a few challenges for homebuyers looking to capitalize on the multi-generational living trend. This is a fairly recent trend in American real estate, so there aren't many homes on the market today designed with multi-generational living in mind. For most buyers, they will need to renovate or remodel a home to meet their goals.
For millennials and members of Generation Z, there is also some social stigma attached to living with their parents. As attitudes towards multi-generational living continue shifting, this stigma will likely fade, but it remains a present concern and challenge for many in those age groups.
While every individual is unique, there are a few key features multi-generational buyers will be looking for. These components will help them take advantage of the benefits and address the issues we've discussed.
While families interested in multi-generational living are probably hoping to spend more time together, it will still be important to have some privacy. The growing trend can lead to an increase in demand for features like in-law suites, soundproofing and larger living spaces allow modern families to live together while still enjoying some alone time.
Additionally, more people under one roof typically means more belongings. Most multi-generational homebuyers will be looking for homes with plenty of storage space or creative storage solutions as a result.
Since the multi-generational living trend is relatively new, its unique concerns can present a challenge for real estate agents. Here are some things to keep in mind when working with clients interested in multi-generational homes:
As more people feel called to live communally and spend more time with their extended families, we can expect to see the multi-generational living trend continue rising. If you keep these tips and tricks in mind, you should be well-prepared to meet the needs of any multi-generational buyer who comes your way!
Holly Welles is a real estate writer and copy editor. Her work has been published on Homes.com, Porch and other industry publications. Learn more about her work via her website, The Estate Update, or connect on LinkedIn for more information.
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