According to the 2014 National Association of REALTORS® Home Buyer and Seller Generational Trends 14% of all buyers last year purchased a multi-generational home. Among all buyers, 24% said the reason for their purchase was children over the age of 18 moving back into the house.
Historically, the nation’s oldest Americans have been the age group most likely to live in multi-generational households however the 2014 data shows that only 20% of buyers purchased a multi-generational home to care for aging parents.
Lately it’s young adults who have surpassed older adults in moving back home. In 2012, 22.7% of adults ages 85 and older lived in a multi-generational household, just shy of the 23.6% of adults ages 25 to 34 in the same situation according to an analysis by the Pew Research Center.
Multi-generational living is a growing trend in real estate. Most common in multicultural markets, multi-generational living now accounts for a much larger population of American households.
Check out the graph from the NAR on why each generation purchased a multi-generational home in 2014.
Factors Behind the Trend
Multi-generational living has been increasing steadily over the past few years and spiked during the Great Recession. In 2012 18.1% of the U.S. population lived in multi-generational family households, double the number of such households in 1980.
The biggest reason for the trend is the large loss in employment for young adults during the Great Recession. Also contributing to the trend is the unemployment and unfavorable job markets that forced college aged students back into the home instead of into the job market. The younger generation is also marrying at older rates, staying in school longer, and more ethnically diverse.
How Is This Affecting the Real Estate Market?
With more households than ever purchasing multi-generational homes, the buyer wish list is going through a change. The 3 bed, 2 bath home is no longer the ideal for most homebuyers. Builders are focusing new home projects with new layouts like Pardee Homes private entry living spaces.
Irvine Company is also picking up on the trend and have built homes in their Lambert Ranch community to accommodate multi-generational families including detached guesthouses, private quarters, offices and studios.
