English

UK multigenerational housing market to triple by 2040

3 MIN READAugust 28, 2019

Multigenerational housing, where two or more related adult generations live in the same property, is a rapidly growing phenomenon in the UK. It’s a way of living that is now present in 1.8 million UK households, which has seen a rise of 38% since 2009 (Cambridge Centre for Housing and Planning Research). Furthermore, one million more young people aged between 21 and 34 are expected to still be living with their parents by 2025, 33% more than at the moment (Aviva). These numbers are expected to triple in the next two decades.

There are many contributing factors to this increase - perhaps the most significant being the increased housing costs in the UK. With increasing house prices and average wage increase not being proportionate with inflation paired with degrading affordability, it is no surprise that millenials stuck living with their parents in their 20s contributes to the majority of multigenerational housing. A recent article from the BBC told the story of a 24 year old couple, forced back into their parents’ homes by rising London rents. 

Among the other factors affecting the younger generations living arrangements include child care assistance, and a helping hand in saving up for a long term goal; such as a house deposit. The emerging trend among millenials definitely seems to be coliving out of necessity, instead of a choice. Having said this, most studies show it being a positive experience for all parties. 

Further contributing to this are older family members moving in with their generation X children, due to a lack of affordable retirement homes and the need for company/ care. This is expected to rise as the national life span continues to increase; as it has done steadily for decades. 

So what does this mean for the real estate sector? Well, developers are beginning to realise that multigenerational housing is starting to take up more and more of the market, and may well look into purpose built accommodations to combat the overcrowding of traditional housing. Having to cater for the needs of your 80 year old mother and your studying 19 year old son under the same roof may need some effective planning, which is why currently 125,000 homes are being converted in the UK to be more multi-generationally appropriate. This is occurring primarily in suburbs and villages, and much less in city centres. 

Developers and residential operators are now looking at other forms of intergenerational living. Homeshare is an initiative that brings together two unrelated people, usually a university student with an elderly person. The scheme offers the student rent free living in return for contribution to the bills and providing an agreed amount of weekly hours of household chores. This helps to provide the older person with company, physical support and help on liaison with relatives. 

Multiple generations of families living under one roof used to be the norm in the early 20th century, but socio-economic influence and the post war boom placed a responsibility and heightened respect on individual home ownership. With the 21st century bringing tightening housing markets and significant rises in university tuition fees and living costs, as well as an increase in the weekly fees of retirement homes, we might see this swinging back the other way. 

If the projected figures are to be believed, the multigenerational housing market will reach around 17% in the next 20 years. That’s 1 in 6 households by 2040. If such a growth takes place, it might provide a solution to the UK housing crisis. 


For further insight into the UK housing market and the wider European residential sector, join a group of senior, c-level investors, developers and lenders at Europe GRI, taking place on 11-12 September in Paris. 


Article by Matt Harris

Related News
←  SHARE
Real Estate
GRI
X
Privacy policy and how we use cookies
We use cookies to give you the best experience on our website.
By continuing we'll assume you're on board with our privacy police
Accept and hide this message