Nineteen percent of the population of the United States live in multigenerational homes. That is a record 60.6 million Americans! A multi-generational home is defined as a household that has more than one adult generation living together. The percentage of the population living in this type of household declined from 21% in 1950 to a low of 12% in 1980. Since then, multigenerational living arrangements have surged during and immediately after the Great Recession of 2007-09. Even though the recession officially ended a few years ago, this housing trend has endured: The number of multigenerational homes continues to grow and the shift shows no sign of disappearing.
The style has become very popular because it puts Grandma and Grandpa together with the grandchildren and the entire family enjoying dinner together .It eases financial worries and it accommodates those needing help in everyday living. The atmosphere throws back to the old show “The Waltons”! But more importantly, this arrangement makes financial sense. Baby boomers whose grown children have moved back in or who are also caring for their elderly parents account for most multi-generational home sales. For a realtor, this situation presents an excellent opportunity to cater to a niche market. If you’ve lost a job, moving in with family keeps a roof over your head and helps keep you out of poverty, and those with student debt can pay down loans more easily. Another possible reason for the trend, it is a part of a return to interdependence within the extended family. This is the way people have always lived around the world.
There are many multi-generational house plans that have become very popular and are designed as small compounds or have Mother-in-law cottages or the “Kids cabin” that are arranged on small plots of land. Many large home plans are designed to include more private areas for independent living such as small kitchenettes, private bathrooms, and even multiple living areas. Separated spaces are typically connected to the main house for security and economy and making the overall look different than an apartment building or a duplex.
A home within a home allows many benefits both financial and logistical. Parents moving in to look after their grandchildren or young adult children returning home after college to save money to pay back astronomical loans are a couple of reasons why multi-generational design is perfect for saving money. And then there is the moment that as parents get older, the family has to have a conversation about their living situation going forward. This is when joining the family full time begins to make sense.
While providing the opportunity to share the comfort of your home with loved ones, the economic and financial logistics need to be addressed at the beginning of the adventure. Getting used to sharing financial responsibilities can be a bit like putting together a jigsaw puzzle. Financial planners advise that families talk early and often about who will pay for what, and what everyone’s expectations are, regardless of whether the shared household results from economic need or simply a desire to have family members nearby. These discussions need to involve everyone and be open and straightforward. No one person should pay for all of the groceries nor should one person pay the electric bill forever. A combination of a set amount of financial responsibility each month and also a value given to providing services such as babysitting, lawn mowing or cooking dinner should have a financial partnership among members. Holding family meetings monthly to go over budgets and air any concerns will keep things congenial and fair. This can help families analyze costs to make sure bills are equal in their distribution.
There can be a financial drawback to sharing a household. Roommates in college can have a clear set of rules when it comes to the bills, but in a family, there is the possibility that things can be too loose. When your grown child in “broke” it is very easy to pay the bills for them “until they get back on their feet”. A list of regular expenses needs to be made and everyone needs to clearly agree on what share everyone will pay. At that moment, you are no longer family. You are all business partners in the real estate enterprise.
Losing one’s privacy seems to be a small complaint when it comes to multiple generations living together. Having a home or compound that has separate entrances to living quarters and thier own little kitchens for different wings of the house can ease that problem of everyone being on top of each other. Families and realtors alike should seek these features and amenities before moving in together.
With buyers looking for these homes or making renovations in their current homes to suit multigenerational lifestyles, this has created a lucrative new market. Although small cottages, apartments over garages and rehabbed basements are still part of the picture, so are new homes that are fully loaded with amenities and a large footprint for all generations. The new amenities such as dual thermostat controls so family members can control the temperatures in each section of the house and multiple kitchens and TV rooms creates a home of the future. Investor families should look for homes that have open floor plans, a main living area and a large dining space for the whole family to gather. Decent sized bedrooms gives each member a space that is entirely their own and very private. A Realtor can do very well with this Niche market, especially if they focus on the home’s features that appeal to these large families seeking multi-generational housing.
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