Multi-generational homebuying is at an all-time high: NAAR
According to the Profile of Home Buyers & Sellers report of the National Association of Realtors, multi-generational homebuying is at an all-time high. According to the report, multi-generational homebuying rose to 14% in 2022 from 11% in 2021.
The report is a compilation of survey data on buyer characteristics. It showed that 15% of first-time and 14% repeat buyers chose to purchase a multi-generational house last year.
Just before the COVID-19 pandemic in March 2020, 11% of all homebuyers were multi-generational. However, multi-generational buyers grew to 15% between April and June 2020.
Why buyers are buying multi-generational homes
According to the report, there are many reasons why multi-generational home buying is increasing. These include caring for elderly parents or relatives, adult kids returning home, and saving on costs.
According to the report, cost-saving was a top priority for first-time buyers (28%). NAR found that this was due in large part to the fact that first-time homebuyers need multiple incomes to afford a house. About 26% of first-time homeowners said that saving for a downpayment was their most difficult step in the homebuying process.
According to the report, 30% of multi-generational homebuyers (first-time and repeat) stated that they made the purchase in order to spend more time with their aging relatives.
The report also showed that 78% of recent buyers had their homes financed, a drop of around 9% from 2021 when 87% of buyers had their homes financed. The average downpayment for first-time home buyers was 6%, compared to 17% for repeat buyers.
The report found that Gen X, which was born between 1965-1979, was the most likely generation to purchase a multi-generational home. NAR says this generation needs larger homes to accommodate two trends: adult children returning home from college and caring for their aging parents.
According to the report, multi-generational home purchases are more common among minority buyers. The report showed that 18-19% of minority buyers were more inclined to purchase multi-generational homes than their Caucasian or white counterparts.