Multigenerational Homes: Multigenerational Living is Back

The concept of multiple generations living in the same house is nothing new.

Multigenerational households declined in popularity after World War II, but they’re on the rise again in a big way.

According to the Pew Research Center, approximately 51 million Americans (or 16.7 percent of the population) live in a house with at least two adult generations, or a grandparent and at least one other generation. Pew also reported a 10.5 percent increase in multigenerational households from 2007 to 2009.

One driver of this trend is changing demographics. While one would normally expect baby boomers to be downsizing at this stage of their lives, quite a few are actually trading up. Boomers are sometimes referred to as “the Sandwich Generation” because they have children still living at home as well as elderly parents.

Second, the recession triggered a wave of so-called “boomerang kids” moving back in with their parents because they couldn’t support themselves financially. There’s also the surge in immigration that started around 1970, dominated by Asians and those from Latin America, who are much more inclined than native-born Americans to live in multigenerational households.

For economic as well as psychological reasons, many boomers don’t want to put Grandma and Grandpa in an assisted-living facility or nursing home. Instead, they’re purchasing new homes where everyone can spend quality time together as a family as well as have independence and privacy.

Multigenerational Housing

In response to the growing number of boomers taking care of elderly relatives in their homes, many builders have made the first-floor bedroom suite a standard feature, says Joan Marcus-Colvin, senior vice president of sales and marketing for The New Home Company (TNHC), Aliso Viejo, Calif.

But homes geared specifically to multigenerational buyers are on the cutting edge of design. They often include self-contained, apartment-like living areas with a bedroom, a full bath, a kitchenette, a separate entrance and sometimes a laundry room and garage. Although the western states, especially California, are ahead of the curve, these multigenerational floorplans are gradually making their way east.

Based on extensive consumer research, TNHC and Robert Hidey Architects of Irvine, Calif., developed floor plans for Irvine’s Lambert Ranch. The community features large single-family homes with various options for extended families, including 800-sq.-ft., detached guest houses; “living suites” with kitchenettes and separate entrances and compound-like estates with shared courtyards.

“We have this multifaceted approach to multigenerational because we figured not everyone’s going to have the same family these days,” says Marcus-Colvin. “We learned that the most successful solution was the detached guest house. It’s in such close proximity to the main house that [although it offers] privacy, it’s very connected.”

One couple that purchased at Lambert Ranch had married later in life. Each spouse had three children from a previous marriage. “They took the maximum number of bedrooms in the guest house so the two returning college kids could live there, and the younger kids in the main house,” she says.

“In the majority of our floor plans, there was an option to convert one of the downstairs bedrooms to a lock-off suite,” says Jose Alkon, sales manager for Lambert Ranch. “We would add a door to the exterior from the bedroom to provide a private entrance, and there would also be a door to the main house so they could maintain that connection.”

In just over a year, all 169 homes at Lambert Ranch were sold, ranging from 2,730 to 4,876 sq. ft. and priced from the $900,000s to $1.5 million. TNHC is now selling multigenerational homes at Villa Metro in Santa Clarita, Calif. — since Villa Metro opened in August 2013, 34 of 60 homes have been sold.

A Home Within a Home

In 2011, Lennar Homes, a national builder headquartered in Miami, Fla., introduced its NextGen line of homes in Homes geared specifically to multigenerational buyers are on the cutting edge of design in Arizona, California and Nevada. The homes include a “lock-off suite” that is, as the company advertises, “a home within a home” — bedroom, full bath, kitchenette, living room, laundry room and separate entrance. Some plans also include a private one-car garage.

The NextGen homes are so popular they’re now offered in 130 communities across the United States, including Florida, Minnesota and New Jersey. Sale prices range from the low $200,000s to $600,000 for 2,000 to 4,000 sq. ft., depending on the community and geographic location.

Jeff Roos, president of Lennar’s West Region, estimates there could be as many as 75 different NextGen floor plans because the company is constantly tweaking existing plans and creating new ones. The one- and two-story homes are designed to fit a variety of lot sizes and there are also variations in the lock-off suites, which include studio, one-bedroom and two-bedroom options. The two-bedroom suites are ideal for a young divorced adult with a child. For the most part, though, it’s the grandparents who end up living in the lock-off suites.

“It’s an opportunity for people to live independently but together,” says Roos. “In the past, even if your home had dual master suites or a [lower-level] bedroom, everyone had to sit at the same kitchen table and on the same sofa.”

With NextGen, you’re accessible to the rest of the people in the home, but you have your own area to cook and watch TV and hang out and do your laundry and come and go as you please. No more fighting over the remote or arguing about what to have for dinner.

Kitchen Versus Kitchenette

Lock-off suites within the walls of a single-family home typically have a kitchenette or service bar with a sink, a refrigerator and a convection microwave oven, but not a range and oven. That’s because some municipalities classify a home as a duplex if the kitchenette has full-size cooking appliances. Lennar’s NextGen homes circumvent such zoning because they run on a single electric meter and, from the outside, they look like other houses.

Lennar and other builders have found that the convection microwave is versatile enough for most types of cooking, not to mention dozens of countertop appliances, such as crockpots, woks and toaster ovens. A kitchenette, by design, is relatively small because it’s meant for one or two people. A range would take up space better utilized for storage cabinets. (Roos points out that for large gatherings, there’s always the main kitchen.)

Another Benefit: Shared Expenses

It stands to reason that, to accommodate more people under a single roof, the home will have to be bigger and, therefore, cost more. “There are some additional costs that go into it, such as the kitchenette and the extra [exterior] door,” says Lennar’s Roos.

However, here’s another way to look at it: if you rented a separate apartment for an aging parent or boomerang child, it could cost you $1,000 a month or more. Then there’s the cost of long-term care. According to a MetLife Mature Market Institute survey, in 2012, the average monthly base rate of an assisted-living facility was $35,550. The national average daily rate for a nursing home was $248 ($90,520 per year) while a semi-private room costs $222 ($81,030 per year).

Factor in the mortgage payment on a conventional home, plus the cost of an apartment, assisted-living facility or nursing home and it becomes apparent that a multigenerational home is a much less expensive alternative. Plus, family members can share the mortgage and other household expenses.

It Can Be a Good Thing

While communal living isn’t for everyone, new multigenerational homes can help minimize friction and promote positive experiences. Grandparents and grandchildren develop a stronger bond. Parents have more peace of mind knowing that the grandparents aren’t alone. They can even get away by themselves occasionally, since Grandpa and Grandma can look after the kids.

“It’s a financial solution, but it’s also a lifestyle solution,” says Roos. “I’ve talked to buyers who say, ‘You’ve changed our lives. You’ve changed our family’s lives.’ They’re no longer imposing on each other and their relationships are much better than they ever could have imagined.”