The multigenerational household was a fairly common occurrence until the 1950s, when it gave up ground to the lure of the suburban development and the rise of the nuclear family. Times have changed, and with them a greater appreciation for multigenerational living.

Today, nearly one in five Americans, or about 60.6 million, lives in a multigenerational household, according to the Pew Research Center. For its purposes, the research group defines multigenerational as two or more adult generations sharing a home. On a percentage basis, this is about the same as in 1950 and well above the 12 percent figure reached in 1980. In terms of people, however, the number of individuals involved has almost doubled.

Why Families Are Sticking Together

Pew credits the influence of Hispanic and Asian populations on society, in addition to the more practical needs of the “sandwich generation,” for the shift. While technically these individuals can be any age, members of this group tend to be sandwiched between adult children still living at—or returning—home and elderly parents who prefer to age in place but need assistance. While the trend toward togetherness accelerated with the Great Recession, it was already on the rise. According to Pew, multigenerational living is a choice that is expanding among all U.S. racial and age groups.

Even families that aren’t multigenerational are showing an interest in homes that accommodate the needs of an extended family. For them, it may be about gaining the flexibility and space to be able to meet future needs. There is also the opportunity to create a source of rental income, as more private homeowners turn into occasional landlords or one-room hotels thanks to online booking sites.

Recognizing the Multigenerational Home

As an emerging trend, the shift back to multigenerational living appears to have some staying power. A recent consumer insights survey indicates that more than 40 percent of new homebuyers would like to be able to accommodate their elderly parents—nearly the same percent who want to be able to accommodate adult children.

National home builders are now designing homes specifically to meet the needs of multigenerational buyers. They are commonly asking for the flexibility to accommodate separate living quarters and common areas under one roof. This includes first-floor master suites with small sitting areas, kitchenettes, and separate entrances. Multigenerational buyers also tend to favor open floor plans, wide doorways, hallways, bathrooms, and pocket doors to accommodate room reconfigurations.

3 Tips for Meeting the Needs of Multigenerational Buyers

Although the nuclear family isn’t quite as dominate as it once was, the houses built to serve it are. That makes locating appropriate homes for these buyers a little more challenging. It also means adapting your search methods to this niche’s needs.

Here are three tips for working with clients with multigenerational needs

1. Thinking “multi” is key to understanding how to work with these buyers. It requires you to understand the needs of each household member, not just those of the buyer.

2. Knowing how the local housing code treats renovations or accommodations for separate entrances, multiple kitchen facilities, and rental agreements becomes essential. Many local ordinances are on the books that prevent “in-law” apartments from being carved out of single-family homes. More recently, ordinances are being passed to prohibit short-term rentals, which may impact your buyer’s plans.

3. Understanding the cost advantages is also crucial. Larger properties may seem more expensive at first, but when the costs can be broken down over two or three households, they may make more sense. There are now mortgages that accommodate both multigenerational buying and renovating homes to accommodate older household members.

The preference for being at home with family represents a great opportunity to meet housing needs that are a little out of sync with the traditional housing stock. Knowing where to find what multigenerational buyers are looking for could lead to a comfortable spot in a growing niche.  

When you are about to make the largest purchase of your life, you need someone who will not only find you a low rate, but who gets the significance and wants to help you succeed in the most affordable way possible. After all, the terms of your mortgage will impact your household finances for years to come.Recognizing the right individual takes meeting several, which you may want to do before you even start looking at homes. The right Loan Officer will prequalify you and help you determine which mortgage programs are right for you, since this could affect the homes you will want to look at.Here are some tips for spotting Loan Officers who will put your best interest ahead of theirs.

1. Trust but verify. Whether you receive a referral from a friend, relative, or your Real Estate Agent, do your own background check. Verify your Loan Officer’s license and registration here. Then, check their online reviews.
2. Don’t stop with just one. Different lenders offer different programs. Due to corporate initiatives, some mortgage companies may seek new business more aggressively than others by offering more attractive pricing. Little savings can add up over the lifespan of a mortgage, which is why comparison shopping is advisable.
3. Never rely on an interest rate quote alone. To make an informed decision about which Loan Officer you want to work with and which product to use, you need to understand all the costs associated with your potential financing. Online calculators can help you determine how the closing costs and any fees might impact your monthly payments and enable you to see your total cost over time.
4. Understand what will be expected of you. In addition to receiving a full breakdown of anticipated fees, determine what kind of down payment you will need and when money will be required from you.
5. Explore communications options. Before you commit, ask the Loan Officer how they communicate and what hours they work. You need to be able to contact your lender at a time and using a method that is most convenient for you. For instance, if you work full time, you may want a lender who is available before or after regular business hours, as well as online.
6. Understand the process. Find out what documents will be needed, when, and how long a decision takes so you can manage your time and expectations accordingly.

Don’t underestimate your own power when it comes to mortgages. Whether a Loan Officer approves your application or not has much to do with you, the steps you take before you apply, and with whom you choose to do business. Choose a Loan Officer based on how collaborative the relationship will be. Their focus should be on you and helping you make the best decisions for your financial situation and your long-term home-owning goals. Remember, you are in control.

When you're interviewing for a job, it’s common to be asked a series of behavioral interview questions and even to take a standard Myers-Briggs test. For a potential employer, understanding your tendencies, interpreting how you make decisions, and identifying the circumstances most likely to stress you out helps determine if you are a good fit for both the company and the position.

When it comes to your own life, seeking that same insight can also help you improve the decisions you make for yourself, especially when it comes to your finances. This is why so many financial companies are adding behavioral assessments to their websites and some advisors even incorporate them into their services. The goal is to help you make better decisions when investing, borrowing, and spending.

Why This Works

There is no denying that you are your own person. However, through the decades, psychologists have narrowed human behavior down to five basic emotional drivers, which are known as the Big Five Personality Traits (also referred to as OCEAN or CANOE). How you rank within the range of each trait can predict how you will manage your money.

Openness:

Whether a person is open to new experiences and places, or resistant to change, can determine how much risk they are willing to take with      their money, not to mention their careers

Conscientiousness:

A highly conscientious person is likely to be organized, value timeliness and make regular bill payments—activities that contribute to higher   credit scores.

Extraversion:

The more outgoing a person is, the more likely they make social connections easily and the more comfortable they tend to be drawing attention to themselves. This could find expression in their spending choices—from statement homes to flashier cars.

Agreeableness:

The higher a person’s agreeableness, the more trusting and compassionate they may be. Financially, this can lead to making decisions from a point of trust—bordering on naivety. Being too agreeable could lead to not thinking to negotiate on prices, sales contracts or loan terms, for example.

Neuroticism:

The more emotional a person is, the more likely they are to react in extremes. For instance, delaying decisions due to anxiety over making a wrong choice, or impulsively choosing without due consideration.

What This Means for Your Mortgage

When you’re looking at homes, and certainly when evaluating the best financing option for your circumstances, it helps to know your own mind.

This awareness can lead to countering impulses to buy too much home or to compromise unnecessarily and buy something too limiting for your needs. It can also help you choose a home loan that matches your personal attitudes toward money management.

For instance, if you are uncomfortable with uncertainty and debt, you may want to choose a mortgage with a strong long-term structure and a repayment plan that automatically debits your account on the same day each month. The certainty and regularity can reduce the stress that you may feel about having to borrow a large sum to buy a home.

In contrast, if you’re a person who is comfortable managing within change and fluctuating debt balances, products involving adjustable rates and with terms that give you greater flexibility month to month regarding repayment, can be useful financing tools in managing your money.

There are many sites that offer to create personality profiles for you, some with eerie accuracy! However, Real Estate Agents and Loan Officers can also help you make decisions that can keep you aligned with your best interests. They base their careers on being able to listen to what you say about your goals, financial circumstances, and desires. Then, they counsel accordingly.