By Rich Harvey, CEO & Founder, propertybuyer.com.au
Almost two decades ago, I heard a story at a barbeque about a family that was building a very unusual house that caused more than a few raised eyebrows around the table.
A couple in their 60s had joined up with two of their adult children, as well as their spouses and their children, to construct one giant home. It had a single front door that led to a huge communal living area and kitchen, which then splintered off into three defined dwellings. In all, there were three generations – six adults and seven children – under one big roof.
The idea seemed very unusual at the time. I don’t know if anyone at that social gathering thought it was a particularly good idea. But for the family in question, it worked.
What we now readily accept as the concept of multigenerational living was something largely confined to certain cultural backgrounds back then, and certainly not a rapidly firing trend like it is now.
And what might’ve been viewed by many back then as an absurd investment proposition – who the hell would want to buy three homes in one?! – was anything but. The family recently sold when the grandparents retreated to a beachside retirement village. It took one week, and they bagged multiple offers, pocketing a very tidy profit.
A fringe trend no more
Several factors have combined to push the idea of multigenerational living into the mainstream in recent times.
Australia’s ageing population is one big reason. Others include new generations achieving key milestones like the start of careers, marriage and children much later in life than their parents and grandparents did. Declining housing affordability is another and who can ignore the cost-of-living crunch.
Sharing the burden of a mortgage, caring for each other, having grandparents around little ones to bring the ‘it takes a village’ philosophy to life – it all sounds more and more appealing.
Between the 2016 and 2021 Censuses, the number of households containing three generations – that is, grandparents, parents and children – increased by a whopping 22 per cent. And according to research by the UNSW Future City Futures Research Centre, a quarter of Sydney households now have more than one generation living together.
Some governments are looking at major planning reforms to accommodate the trend, such as Victoria, where homeowners can bypass local councils to build granny flats in their backyards without the usual red tape and bureaucratic hassle.
Research by the E61 Institute found that after similar changes were adopted in New South Wales in 2006, the number of ‘secondary homes’ like granny flats doubled from 0.3 per cent to 0.6 per cent of total detached dwellings over the next 15 years.
That doesn’t look like a big number on its own, but the analysis calculated that the uptick in granny flat construction accounted for 1.5 per cent of Sydney’s total new housing supply in that period. That’s nothing to be sniffed at.
Some of the country’s biggest builders report increased interest in larger floorplans that allow for multigenerational living. This is driven by both current young families expecting their kids to stay at home much longer than in previous generations as well as people concerned about their ageing parents.
The investment considerations
Perhaps you’re in a position where the notion of two or more generations under one roof makes sense. Maybe you’re an investor keen to get in on the trend as early as possible to bank some healthy future capital growth.
Whatever the scenario, there are some important elements to weigh up when considering a home where grandparents, parents, adult children or younger children could all live together in harmony.
First of all, size obviously matters. You don’t necessarily need an enormous McMansion, unless of course you’ve got a large number of family members, but a floorplan with flexibility is important.
A home with room to move is important, including living spaces that are adaptable. It might be two lounge rooms – one for intimate and relaxed settings like entertaining by grownups, and one where residents of all ages can muck in for a rowdy showing of the latest Minions movie or a family trivia night.
Similarly, outdoor spaces matter. Little people like room to burn off excess energy and all parents are keen to ensure their kids get off devices and away from screens to breathe in fresh air and get some vitamin D. Some kind of space that meets these needs, whether it’s a cleverly designed courtyard or a spacious yard with perhaps a prized feature like a pool, is necessary.
So too is multi-car accommodation. Even suburbs well-connected to public transport or with a high walkability score won’t leave families entirely free of the need for a vehicle. Ask any parents with a small child or two about lugging them to and from sports or dance commitments and they’ll agree. Plus, older generations like the ability to retain some of their independence.
Privacy is another consideration that’s often overlooked in situations like these. Having somewhere to quietly disappear to when things get too noisy – and noisy they’ll sometimes be with so many people of varying ages and interests all together – is a big tick.
And with the remote working trend showing few signs of easing, a dedicated space for someone to do their business in peace is another important consideration.
Lots of boxes to tick
Finding a home that meets those base needs as well as your own wants is tricky, especially in a market like this where buyer competition is fierce and supply is limited.
Working with an experienced and well-connected buyer’s agent is your best chance at finding golden opportunities that tick those crucial boxes. Not only are they able to source potential properties quickly, but they have access to prized networks in order to unearth homes that don’t make it to the open market.
They’re properties that could be perfect for you but that you’d otherwise miss if you’re going it alone.
Crucially, working with an expert can also help you to identify and mitigate any long-term risks, like future resale potential. The last thing you want is a home that’s fit for your purpose but not someone else’s. A buyer’s agent who knows the market and has their finger on the pulse of current and changing trends and dynamics at a local level can help you weigh up the pros and cons to make the most informed choice possible.
And a buyer’s agent also handles all of the fuss and hassle, from start to finish, so all you need to do is decide which couple gets the best bedroom.
Or, if you’ve got a particularly good buyer’s agent, perhaps each member of your multigenerational household has the room of their dreams and there’s no need for tough decisions.
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