What’s New in Homebuying: Multi-Generational Living

Real Estate markets fluctuate daily but one industry trend has persisted for years- the most common expression is ‘lack of inventory’. It has been the motivation behind most of our ongoing problems with the real estate market. Home prices soared because of low inventory and current home buyers are in limbo for the same reason. Combine this with higher mortgage interest rates and rising rents, and potential home buyers including Gen X, Millennials and Gen Z, are finding the present market challenging to navigate. Indeed, the only group maintaining any benefits in today’s Real Estate environment, seems to be the Baby Boomers.

Having lived through several decades of “normal” markets, and after successfully weathering a few industry twists and turns, the Boomer generation appears to have come out the other side with a few financial advantages. Many older homeowners are in a position to profitably offload larger homes and move into something smaller and more suitable to their lifestyle, with little or no mortgage debt. But this isn’t exactly what’s happening.

There seems to be a vicious-circle anomaly going on here. Contributing to the whole continuing lack-of-inventory issue is the fact that younger generations can either not afford to buy a home or simply can’t find one to buy. So where are these younger people moving to? (Here’s where the market all goes wrong…) to their parent’s house. You know, the Baby Boomer’s too-large home that would typically have been downsized. Baby Boomers aren’t moving out because their grown kids are moving in.

Home builders too are recognizing that multi-generational living and multi-family dwellings are in demand. Many offer several multi-family design options including both separate and communal living spaces.

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RIS Media explains in their post below, what people are looking for in a multi-generational home.

What Mom Wants: A Home for Grown Kids

As housing costs rise and student loan debt grows, mothers are becoming increasingly concerned about their children’s ability to afford a home. According to a recent survey of 1,000 mothers by The NHP Foundation, a not-for-profit provider of affordable housing, many are concerned about the ability of their adult children to live on their own. Nearly a third (29.86 percent) of the moms surveyed are anxious about their grown children needing to stay with them for an extended period of time.

These concerns are no surprise, considering that 53 percent of the moms surveyed make family financial decisions either alone or with “some input” from a partner. These moms often act as CFO of the family, taking a more active role than ever in the household’s finances and investments.

Many women are also living with extended family. In fact, 17 percent of those with a partner and children also report parents or other relatives living with them, emblematic of the modern “sandwich generation.”

Here are some other interesting findings from the report:

Nearly 63 percent of moms say their adult children are not fully prepared to live on their own.
Only 30 percent of moms say that their adult children who live with them are actively looking for other places to live, and less than half (41 percent) say their kids pay rent. One positive note: 67 percent of adult children help around the house, and 65 percent of them are employed.
Mothers are very aware that their grown children don’t have it easy. Ninety percent are concerned about rising housing costs, with 43 percent saying they are “very concerned” on their kids’ behalf. Nearly 40 percent of moms worry at least once a day about their adult children’s ability to afford desirable housing.
Once kids do move out, only one-third of moms would co-sign a loan for their children, and even fewer (24 percent) would help subsidize rent or a mortgage. Nearly 36 percent say they aren’t prepared to help their adult children financially in any way.

To combat these and other rising concerns about housing affordability, The NHP Foundation is looking to the government to continue programs like the Low Income Housing Tax Credit, and to new private and public partnerships designed to increase its stock of quality affordable housing. The NHP Foundation has also been selected by the University of Virginia School of Public Policy as part of a study seeking new models to help ensure that this and future generations are able to afford desirable places to live.

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eMail: golfarizona@cox.net
Bill Salvatore / Arizona Elite Properties
Your Valley Property Team
Residential Sales, Marketing, and Property Management

Selling Arizona for more than 20 years

Founder: AZVHV Arizona Veterans Helping Veterans
Recipient: East Valley Tribune’s: Best Gilbert, Arizona Realtor

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