Multi-generational Market

Multigenerational Market – a new trend or market reality?

In a proactive approach to understand market conditions, Coldwell Banker surveyed 2362 real estate sales professionals in 2010, the survey results indicated that about 37 percent of its sales professionals saw an increase in the number of homebuyers looking to purchase a home that could accommodate more than one generation over the last 12 months. 

Almost 70 percent of Coldwell Banker sales associates believed that economic conditions driven in part by the job losses and home foreclosures of recent years will cause a greater demand for multigenerational homes in their market during the next year. Financial drivers (29%) and health care issues (29%) were cited as the main factors behind this trend, whereas 6% mentioned a desire to help and unite family as a strong factor.

Certainly assisted-living care is cost prohibitive for a growing number of families since basic services can begin at $4,000 forcing elderly parents to move in with their children.  But the benefits go beyond just financial reasons, with two or three generations living under one roof, families often experience more flexible schedules, quality time with one another and can better juggle childcare and eldercare.

Other reasons for the rise in multigenerational living can be attributed to a growing number of children who are moving back in with Mom & Dad due to financial, economic and employment issues.  Also, a good number of college students are living at home until their career advance. Moreover, there is change in median age of first marriage and child bearing too, the typical man now marries for the first time at age 28 and the typical women at age 26. 

The 21st century is looking more and more like the 19^th century. The 2010 Pew poll states that in 1940, about a quarter of the population (24.7%) lived in at least two adult generations; but by 1980 it was reduced to just 12%. By 2008, a record 49 million Americans (16.1%) lived in multigenerational homes, an increase of 2.6 million from 2007. 

Today, there are 6 million U.S. “multi-generational” households that consist of at least three generations of family members, 30 percent higher than in 2000 according to a recent New York Times article that cited Pew Research findings.

Cultural Trend and Immigration.  Multi-generation or joint household is an everyday life and housing pattern in cultures around the world.

Immigrants are a source of this growing multigenerational housing demand in the United States -- dominated by Latin Americans and Asians. The Latino and Asian household composition is different in fundamental ways from the domestic-born, declared said Kermit Baker, a senior fellow at the Joint Center for Housing Studies at Harvard.

Even when several generations are not living together permanently, more and more families are looking for housing alternatives that can readily accommodate extended visits from overseas relatives.

Multigenerational communities. Many new communities in Central Florida are answering to this demand, housing projects aimed at accommodating extended families is becoming a growing real estate niche according to The New York Times report. 

Builders and architects are mindful of multigenerational needs, designing some units with a bedroom and a full bath on the main level so the elderly could avoid the stairs.  Multigenerational town houses and single family homes, designed primarily for families that include grandparents or grown siblings, have become one of the housing market few growth areas.

Tips on dealing with multigenerational buyers and sellers.  As leaders in the real estate industry, real estate professionals must possess

     Flexibility, knowledge and understanding of the market and its trends to effectively work with multigenerational buyers and sellers.

      Adequately prepare to serve a multiethnic – multicultural clientele needs and demands, such as language ability and cultural understanding; use of technology such as Internet, social media, smart phones, videos, etc.  Buyers like property and community videos.

      Knowledge and understanding of real estate contracts, REO, Short Sales, negotiating skills.

     As a listing agent -- it’s important to highlight the multi-generational features of the home, such as second master bedrooms with private bath or separate entry, garage apartments or finished basements, "mother-in-law suite" or bedrooms in the first floor.

      When working with buyers --prompt questions to understand their exact needs when discussing housing requirements, are other family members a consideration?  Do you just need an extra bedroom or will additional living space be required? Also, consider the location and its proximity to heath care facilities, schools, childcare facilities and other areas that are important to your family.

Recommendation to multi-family living: Extended families buying a home together should consider signing a written contract outlining everything, from finances to chores and childcare.

Multigenerational housing is a market reality and will continue to be the hot niche in a cooled market for several years to come. Let be prepared.

Monica Richter,

Coldwell Banker Real Estate

Broker Associate, GRI, CSIP, REO

Rollins Crummer '10 MBA Management, Marketing

Member of ORRA, FAR, NAR

Grievance Committee Member

Budget and Finance Committee Member

Communications Committee Member