Multigenerational Homes Meet Varied Needs

Paul Tsai lives with his wife and in-laws, but the 42-year-old restaurateur doesn’t feel crowded.

That’s because he lives in Riding Oaks Estates in Ann Arbor, Mich., in a multigenerational home specially designed by Horsham, Pa.-based Toll Brothers Inc., to fit the needs of multigenerational families.

When Tsai signed the contract to build the home, he added a master bedroom suite on the ground floor, in addition to the standard master on the second. The suite features a bedroom and bath along with a sitting area and large walk-in closet. The family shares a kitchen.

“This home affords us the best of both worlds,” says Tsai. “We were too cramped in our old home when (the in-laws) were in another bedroom next to our bedroom. But now with them in a separate side of the house, we’re very comfortable.”

Tsai paid an additional $120,000 over the $850,000 base price of his five-bedroom, five-and-a-half bath home to add the additional master bedroom.

Multigenerational Homes are a Growing Trend

But he’s not the only one opting to live in a multigenerational home. Whether it’s college graduates returning to the fold because they can’t find a job or elderly parents moving in with their kids to avoid the cost of senior housing, more and more people are living in multigenerational households.

According to a Pew Research Center report released last year, the number of Americans living in multigenerational family households has continued to rise. In 2014, a record 60.6 million people, or 19 percent of the U.S. population, lived with multiple generations under one roof, up from 51.5 million, or 17 percent of the population in 2009.

“Based on our demographic research, there’s going to be a huge demand for multigenerational homes,” says Lesley Deutch, a consultant with John Burns Real Estate Consulting in Boca Raton, Fla. “Part of the reason why it hasn’t caught on even more is because some municipalities classify them as two separate homes on one lot, so that can be a little tricky for builders.”

One of the ways builders avoid having multigenerational homes classified as two-families is by leaving out a stove when the house includes a separate kitchen. The kitchenette will have a sink, refrigerator and microwave, but not a stove.

Miami-based Lennar Corp. has been building multigenerational homes since 2011. Its product is called NextGen and it’s essentially a home-within-a-home, currently available in more than 300 Lennar communities in 12 states.

How Does a Multigenerational Home Work?

A typical NextGen floor plan by Lennar will include a private living room, bedroom, full bath, kitchenette and single-car garage. With a separate entrance, as well as a door into the main home, residents can spend as much or as little time as they’d like with the primary residents.

“A NextGen home is an economical solution for families and for builders, who gain some economies of scale with our building practices,” says Kim Ashbaugh, Lennar’s director of NextGen brand management. “Families can combine a mortgage, utilities, maintenance, get help with childcare or care for an aging parent — and you can do it all within the comfort of your own home.”

The cost of NextGen features is built into the price of the home, Ashbaugh says, because the builder achieves economies of scale during construction. There’s a single foundation and utility box and one roof truss system. “We were able to save a lot by doing that and pass that to our customers,” she says. “We’ve worked really hard to make this a viable solution and not make people feel we are gouging them for that additional 500 to 800 square feet of home.”