Families with several generations living under one roof are becoming more common. And it’s not “just” due to the Great Recession.
Trulia posted a blog about multi-generational living in honor of “National Parents Day” on Sunday, July 24th. The real estate website says the latest Census data shows that 4.6% of all U.S. households are multigenerational or “sandwich generation homes”. That’s a 1% increase from 3.6% just ten years ago, in 2006.
Multigenerational Living Statistics
Trulia dug into the data a little bit to see what’s up with the increase. Of course, many families moved in together during the Great Recession, as people lost jobs and homes. Grandparents may have moved in with children or vice versa. Millennials may have moved back in with mom and dad when they couldn’t find a job, and may be moving back with them now, because of rising rents.
But even with the financial meltdown that left families huddled together for survival, the data also shows that this kind of living arrangement is historically common among Hispanics and Asians. And, these are the two fastest growing populations in the nation.
Trulia shows the number one city for multi-generational living is Honolulu, Hawaii. The data shows that 9% of the households are multi-generational. Almost three-quarters of those homes identify themselves as Asian or Pacific Islander.
Number two on the list is El Paso, Texas just north of the Mexican border. Those multi-generational homes are mostly Hispanic.
The other cities with the most “sandwich generation homes” are Riverside, California; Miami, Florida; Fresno, California; Los Angeles, California; Bakersfield, California; Long Island, New York; Oakland, California; and Oxnard, California in Ventura County.
When it comes to homeownership, the National Association of Hispanic Real Estate Professionals says that Hispanics were the only racial group to increase their homeownership rate last year. The Census Bureau says there was a big one-year spike in the Hispanic homeownership rate from 44.5% in January to 46.7% in December of 2015. And homebuilders are paying attention.
What It Means for Real Estate Investors?
The National Association of Realtors says that homebuilders are making some design changes to accommodate multi-generational families. NAR refers to a list of design options published by the Huffington Post.
One important design feature is to provide “open access” for members of every generation. That might include wider hallways and doors to make room for grandma’s wheelchair or grandpa’s walker. It might also include childproof locks on kitchen cabinets so kitchens are not dangerous places for young children. A larger garage may also be good for an additional car or storage.
Having more than one master bedroom is also an important design feature. With two master suites, adult couples living with their aging parents can do so without sacrificing their own personal space.
Privacy is also important, so master suites could also be located in different parts of the home. It might also be smart to have one master on the first floor of a multi-floor home, for seniors or those with disabilities.
Instead of a second master bedroom, some people might prefer an in-law unit. This is usually a mini apartment with a separate entrance, a full private bathroom, and a small efficient kitchen. NAR says that many homebuyers are willing to pay extra for homes with in-law suites.
For those people buying homes for extended families, a combination of square footage, price and location might be the first things to consider. If the home is big enough and cheap enough, it will be easier to incorporate the necessary upgrades.
Location would be dictated by the needs of all the generations, from school-aged children who need a good school district, to millennials who return home and commute to work, and to seniors who might want amenities like paved walking paths, a senior center, or nearby medical facilities.
Rich and I own a duplex in an up and coming part of Pittsburgh, PA. A father moved into one side and his son on the other. They just signed a five year lease! This is another way investors can take advantage of the growing trend for families to live together but separate.