Innovative housing solutions, like multigenerational living and dual living, are increasing in demand and proving to be beneficial during tough economic times.
Unfavourable economic conditions are encouraging people to find alternate ways to help sustain a household. A popular trend growing across the globe are dual living, which provides a rental income stream and multigenerational living which helps to cut down costs.
What is multigenerational and dual living?
Both innovative solutions are dependent on a number of people co-existing on the same property.
Multigenerational living consists of more than two generations living under one roof.
Dual living on the other hand, consists of one main property that comprises additional dwellings which may be shared by two separate parties or tenants.
For dual living, there are practical and regulatory issues that need to be taken into account should a homeowner decide to convert a home into a dual living property.
A growing world-wide phenomenon:
Multigenerational living is becoming a leading option amongst families who are finding it difficult to make ends meet. This is due to the rising costs of living which makes it especially challenging for youngsters to leave the nest.
According to Lew Geffen Sotheby’s International Realty Executive Director Sandy Geffen, who has more than three decades of property industry experience under her belt, South Africa isn’t immune to this trend.
“Young adults are living with their parents for longer, affordable retirement accommodation is in short supply and home ownership is frequently delayed for years as young families and first-time buyers now have to save for bigger deposits,” says Geffen.
The last South African Census suggests that just over 50% of the country’s households are multigenerational. In accordance with a study reported in Time Magazine last November, it was noted that young adults (aged 18 to 34) in the United States are living with their parents in greater numbers now since 1940.
According to Geffen, local estate agents have experienced an evident increase in the number of queries for properties that can accommodate extended families.
The benefits of this type of arrangement:
The need to share a property is a necessity for many as result of a weak economy. However, Geffen suggests that this type of arrangement can be advantageous.
“There’s always a silver lining to be found in any challenging situation and in this instance there are several, even if it’s a case of three generations squeezed into one not overly large home.”
Sharing household expenses can help to ease the financial pressures that accompany homeownership. Sharing a home can also provide a better quality of life and can strengthen the bond between a family, especially in a time where the traditional family unit has become less prevalent.
Geffen says that multigenerational living can solve the everyday challenges faced by modern households.
“Few families today can afford a stay-at-home parent and many are finding it difficult to cover the costs of childcare, so in this way the need for care for both grandchildren and grandparents can be seamlessly accommodated” says Geffen.
Home safety and security is an additional benefit of multigenerational living. More people sharing a household means that the home is unlikely be unoccupied for long hours during the day.
Elderly family members living in a shared household are also less likely to become vulnerable targets of crime compared to when living alone.
The challenges of multigenerational and dual living:
According to Geffen it’s important to consider the challenges that can arise when embracing this style of living. A shared household can include different needs and expectations that can become problematic if not managed correctly.
Geffen advises that “planning, flexibility and ground rules are essential to make it work for everyone in the long term, because unless all parties buy into the household ethos it can go horribly wrong.”
An essential guideline to avoid the pitfalls and maximise the benefits:
• It’s important to define each person’s responsibilities and any particular requirements upfront. Consider if additional care and assistance is needed by inhabitants and to what extent this needs to be implemented.
• Set boundaries to be decided upon together and ensure these are mutually respected by every household member.
• Choose your battles wisely – general disagreements may arise but not all are worth a full-scale argument.
• It’s important to allow sufficient time and space away from each other to avoid becoming overwhelmed.
Dual living with tenants:
For cash-strapped home owners and prospective buyers, dual living with a paying tenant is a smart way to stretch their budget in order to pay off a home loan faster or make a purchase in a high-demand area.
According to Geffen it also enables first-time buyers to enter the market sooner. “It might take a bit of time to find the right property, but it’s worth the effort in the long run.”
Dual living can fund retirement:
South Africa has fewer than 10% of retirees that are financially independent. According to the country’s Reserve Bank, South Africa has one of the worst savings records in the world, which is why Geffen encourages dual living as an excellent way to help fund retirement.
“A rental income enables younger home owners to save in tough economic times. At the other end of the scale, active retirees can stay in their family homes longer knowing their living expenses are subsidised by an on-going rental income stream” says Geffen.
Establishing privacy in dual living arrangements:
In order to achieve successful dual living, it’s important to ensure inhabitants are able to enjoy a measure of privacy.
By considering everyone’s needs and requirements within a household, home owners will be able to establish whether a separate, self-contained dwelling would be most suitable for everyone or if altering an already existing structure would suffice.
According to Geffen, this applies to current home owners and prospective buyers looking for conversion properties.
The building of separate dwellings:
“If you want to buy and build a separate dwelling, it’s imperative to first check whether you’d get local authority planning permission before taking the leap. And regardless of whether you intend to convert or build separately, always consult a reputable architect who’ll draw up plans that don’t contravene bylaws or zoning regulations.
It is crucial to check whether you’d get local authority planning permission, before moving ahead with plans to buy and build a separate dwelling. Consulting with a reputable architect is essential, regardless of whether you intend to convert or build separately. By liaising with an architect you can ensure that the building plans won’t contravene bylaws or zoning regulations.
Ensuring that the construction of the separate dwelling is done in the correct manner will be beneficial later down the line. Cutting costs to save a few rands can become costly and if you decide to sell the property at a later stage, the selling process can be delayed if the property structure does not match the initial property plan.
Why you shouldn’t overcapitalise:
Overcapitalising is the most common pitfall amongst homeowners. To avoid this, Geffen advises on the importance of conducting thorough research in order to understand the local market. Consulting with a reputable estate agent will enable you to achieve helpful advice on rental price options and market trends within your area.
Doing so will help to ensure you don’t over-capitalise, which can diminish a return on an investment if the costs outweigh the revenue.
Geffen concludes: “In the current economy, whether you want to off-set the rising cost of living or simply create a new income stream, dual living makes a lot of sense. If implemented correctly it has far more benefits than disadvantages and will add substantially to the value of your property when you eventually sell.”