What’s driving more multi-gen living? – John McGrath

During my 40 years in real estate, I have witnessed the market adapt to change in many innovative ways. It wasn’t that long ago that the Bank of Mum and Dad and ‘rentvesting’ did not exist at scale, investors only bought locally, and families would have never contemplated apartment living.

These are all examples of how resilient and creative Australians are in finding ways to afford a home.

Another adaptation is the rise of multi-generational living, which has many more benefits than just sharing the cost of a mortgage.

The most common scenario is a young couple, perhaps with their first child, living with one set of their parents. The young couple might move into an existing family home held by the parents, or they might pool their finances and buy a larger new home together.

Another common scenario is young single adults remaining in the family home well into their 20s or 30s to give them enough time to save a deposit for their own home or an investment property.

Multi-gen living is often a short to medium term arrangement, mostly to allow younger family members to save for their own homes.

But some multi-gen families have longer term intentions because of the increasing need to provide care within family units. This is another significant factor driving more multi-generational living.

Two examples are more grandparents helping to raise their grandkids, so mum and dad can both work full-time to pay the mortgage, and more G en Xers assisting their elderly parents with their health care and everyday logistics such as transport.
These Gen Xers are called the ‘sandwich generation’ because they are caring for their parents while also raising young children.

As a trend, multi-generational living is likely to continue growing given Australia’s aging population and also ongoing growth in home values.

And it’s a trend that is also impacting home design.

Many homeowners have adapted their properties to create two self-contained areas – either separate wings of a single level home, or the upper and lower levels of a multi-storey home.

Others have built granny flats, either in the backyard or on top of existing structures like a garage. More people are doing this after planning laws were changed to address the lack of housing supply.

Granny flats adds significant value because more buyers out there in the market are specifically looking for homes with multiple rooms, either for multi-generational living or just to create better separation between living and working zones, given so many people are now working from home.

While multi-generational living is relatively new in Australia, it has been a part of the lifestyle in other countries, particularly in Europe, for a very long time.

As a highly multicultural nation, I think many Australians have observed multi-generational migrant families living together successfully and have latched onto the idea.

There are many benefits to it, and I think it’s a great example of how migration and cultural norms from overseas have influenced the way Australians choose to live today.