Latest Trend in Housing: Multi-Generational Homes

Residential real estate investors should always try to be ahead of the curve when it comes to housing trends, anticipating the demands of potential tenants for years to come. Real estate experts and financial experts have become aware in these recessionary times that multiple generations of families are moving in together by choice and necessity to save on living expenses. Whether it is a college graduate returning home to his parents’ home for a few years, retirees choosing to move in with their adult offspring or a combination of all three generations, these households need to make some financial, emotional and sometimes physical adjustments to make the living arrangement work.

At Home ... With the Parents

A recent survey by Coldwell Banker Real Estate LLC among its network of real estate professionals revealed that 37% of sales professionals noticed an increase in the number of homebuyers looking for a home to purchase that could accommodate more than one generation. Almost 70% of the sales agents believe that economic conditions will cause greater demand for multi-generational homes in the next year.

Saving money is the number one reason several generations move in together, but the trend is also being driven by health care issues, family bonds and the convenience of flexible schedules for child care and elder care.

Sharing the Space

Families searching for a property to rent or buy together should discuss the options for sharing bathrooms, office space, common areas and even a kitchen. In many cases, a single family home with a kitchenette or full second kitchen on a lower level or in a private wing of the home is ideal. Homes with an apartment above the garage or a finished lower level with an exterior door work well for accommodating extra generations, allowing for privacy for the elderly or for adult offspring.

Another issue associated with housing multiple generations can be cars. Either a home with a larger garage or extra off-street parking works best for households with multiple cars.

Save Headaches with a Contract

Finances should be carefully examined when extended families purchase a home together. While the families may think they have avoided all the potential pitfalls of co-ownership, a written contract including everything from finances to childcare and chores is the best way to avoid future battles over which family member needs to pay for the roof repair and whose turn it is to mow the lawn.

Property investors should view potential purchases with an eye to how well they accommodate multiple generations as tenants.

Interestingly, homes with a bathroom for each bedroom, with more than one kitchen or with an oversized garage work equally well for roommates as they do for several generations of one family. Both scenarios should be considered when looking for a property you hope to keep fully leased for years to come.