February 10, 2021
A growing number of Americans are choosing to live with their parents or have parents or other older relatives move in with them.
According to the 2020 Profile of Home Buyers and Sellers from the National Association of Realtors (NAR), 15% of all homes sold since March 2020 were suitable for multi-generational living. That’s up from 11% in 2019.
Nearly 20% of Americans now live in these multigenerational households – a level that hasn’t been seen since 1950, and up from a low of 12% in 1980.
There are many reasons people choose to live in multigenerational housing. In some Latin American and Asian cultures, elder relatives living in the home is the norm. Many immigrants from these countries brought these traditions to the U.S. with them.
Economic factors are also at play. In the late 2000s, the Great Recession fueled an increase in family co-habitation. As home prices have steadily risen, many younger people choose to live with parents or other older relatives, hoping to save up money for an eventual down payment on their own home.
Out of necessity, homes intended for more than one family tend to be nearly 22% larger than the average single-family home, or roughly 2,290 square feet. However, buyers find the actual cost is only about 10.7% higher. Multi-generational living is often cheaper.
Successful multi-generational dwellers say a firm set of boundaries must be established – with agreements on bills, groceries, and chores. Lots of fridges and separate TV rooms are essential.
The recent increase no doubt is due in part to the coronavirus pandemic. Many of the 2020 and 2021 homebuying crop are looking for larger, more flexible living space.
When necessary, older relatives can become part of the immediate family, rather than having to be isolated. Besides saving money, there’s other benefits, too. With children and adult workers at home, an older relative can serve as the designated babysitter/school administrator.
An increasing number of Americans of all ages suffer from chronic conditions and/or disabilities. They often move in with family to gain access to caregivers.
Multi-generational homes include single-family homes that offer private kitchens and separate entrances or attached units in a duplex. They also include detached accessory dwelling units (ADU), which are typically smaller homes in the backyard of a larger house.
If you’re selling, the potential for an ADU or in-law suite is an attractive home feature to point out to buyers.
When not being used as a residence, separate living space can also double as a home office, guest quarters, teen bedrooms or short-term vacation rentals, making them a wise investment.
Multi-generational homes are especially attractive to families with older relatives on fixed incomes, or older homeowners looking to downsize and rent out their main property.
Know the local laws. Zoning regulations differ between jurisdictions and could derail any plans to use this amenity as a money-maker.