Accommodating Multigenerational Tenants: A Growing Demand

There has been a notable rise in multigenerational tenants seeking rental homes in recent years. This shift in housing trends is being driven by various social, economic and cultural factors. For buy to let property investors, understanding and adapting to this trend can offer new opportunities.  

The Emergence of Multigenerational Living

Rising property prices and living costs have made it challenging for younger generations to enter the housing market. By living with family, individuals can share expenses, making daily living more affordable, and save for potential homeownership. Additionally, with an increasing number of elderly individuals, families cohabit to provide care and support, ensuring the well-being of older members. Given the high costs of care homes and assisted living, many families find that living together offers a more financially viable and emotionally supportive alternative.  

Benefits of Multigenerational Living for Tenants

For tenants, multigenerational living offers several advantages that make it an increasingly attractive option in today’s housing market.

• Financial Savings: One of the most significant benefits of multigenerational living is the potential for cost savings. With multiple family members contributing to household expenses, the economic burden of rent becomes more manageable. This financial arrangement can provide much-needed relief and security for younger adults struggling to afford their own property just yet or older parents living on fixed pensions.

• Mutual Support: Living in a multigenerational household fosters a strong support network, with family members assisting one another in various ways. For parents with young children, having grandparents in the home can significantly reduce childcare costs and provide emotional security for children. Likewise, adult children can support their elderly parents, reducing the need for expensive external care services.

• Enhanced Living Standards: By pooling financial resources, multigenerational families can afford larger, better-equipped homes than they might be able to individually. This can mean access to more spacious living areas, additional bathrooms, gardens or home offices. Additionally, renting a house in a desirable location, such as near good schools, healthcare facilities or employment hubs, becomes more feasible when costs are shared.  

Property Features for Landlords to Seek

When looking to purchase a buy to let property with multigenerational tenants in mind, landlords should prioritise homes with the following features:

• Multiple Bathrooms: Multiple bathrooms are key for larger families. An additional en-suite or a separate toilet can improve convenience and privacy, making the property more attractive to potential tenants. Properties with the potential for the installation of an extra bathroom should also be considered, as this can be a worthwhile investment.

• Flexible Living Spaces: Homes with adaptable areas, such as basements, attics, large reception rooms or open-plan living areas offer multigenerational families the ability to modify spaces according to their needs. For example, a spare reception room could be used as a private living area for elderly parents or a converted attic might serve as an independent space for adult children. Properties with annexes or the potential to create separate living areas are particularly valuable in this market.

• Separate Entrances: Having separate entrances provides greater autonomy and privacy, allowing family members to maintain a degree of independence while still living under the same roof. This setup is particularly appealing for families with elderly parents who require personal space or for adult children who may be working or studying.  

Modifications to Existing Properties

For landlords who already own properties and want to make them more suitable for multigenerational families, strategic modifications can significantly increase the property’s appeal and functionality. Some key potential improvements include:

• Creating Self-Contained Units: Converting garages, basements, lofts or outbuildings into self-contained living spaces can offer privacy while keeping family members close. A well-designed annexe with a kitchenette, bathroom and separate entrance can attract tenants looking for adaptable living arrangements. Not only does this enhance the property’s rental potential, it potentially also allows landlords to rent out the units separately if circumstances change in the future.

• Installing Accessibility Features: Given that many multigenerational households include elderly family members, making a property accessible is a wise investment. Installing stairlifts, widening doorways, adding ramps or converting bathrooms can make the home more accommodating for senior residents or those with mobility issues. Accessibility modifications not only appeal to multigenerational families but can also increase the property’s long-term rental value by catering to a broader demographic.

• Soundproofing: In larger households, noise can be a concern, especially when different generations have varying schedules and lifestyles. Soundproofing walls and floors with insulation, carpets or acoustic panels can help maintain harmonious co-living.  

Benefits to Landlords

By accommodating multigenerational families, landlords can enjoy several advantages. The stability in demand and positive social impact of renting out to extended families makes this a potentially valuable strategy. As the rental market and housing trends evolve, landlords who embrace this shift can potentially future-proof their investments while fostering long-term tenancies.

• Reduced Vacancy Rates: One of the most significant benefits of renting to multigenerational families is the likelihood of longer tenancy agreements. Unlike single tenants or smaller families, multigenerational households often seek stability. Many extended families prefer to remain in the same home for years to avoid the hassle of relocation, school disruptions for children or the difficulty of finding another property that suits their living arrangements. This reduces turnover for landlords, minimising vacancy periods. A long-term tenant also provides landlords with a more predictable rental income.

• Wider Tenant Pool: Landlords can expand their potential tenant base by offering properties that cater to multigenerational households. Typical rental properties appeal to young professionals, small families or students, but homes designed for multigenerational living attract an additional demographic: larger families seeking more spacious, adaptable homes. This increased demand can make it easier to secure tenants quickly and may even allow landlords to command higher rental prices, particularly in areas where suitable properties are scarce. Additionally, as multigenerational living becomes more common, landlords who adapt to this trend will have a competitive edge in the rental market, ensuring sustained interest in their properties.

• Positive Community Impact: Supporting multigenerational living can also have broader social benefits that reflect positively on landlords. Homes that accommodate extended families contribute to stronger and more interconnected communities, as they encourage family support networks and reduce the strain on public services such as care homes and childcare facilities. By offering housing that aligns with the evolving needs of tenants, landlords can build a reputation as responsible property owners who provide high-quality living spaces tailored to emerging family structures. This can lead to better relationships with tenants, positive word-of-mouth referrals and potentially improved relations with local authorities, who may favour landlords who support inclusive housing solutions.  

Challenges and Considerations

While the benefits are substantial, landlords should also be mindful of potential challenges when it comes to multigenerational tenant rentals:

• Planning Permissions: Significant modifications may require local authority approval. It is essential to consult with planning departments before undertaking any structural changes.

• Increased Wear and Tear: Larger households may lead to more rapid wear of the property. Landlords should budget for more frequent maintenance and consider this in tenancy agreements.

• Legal Implications: Ensure that any modifications comply with housing regulations and that tenancy agreements are appropriately structured to reflect the living arrangements.  

Conclusion

The rise of multigenerational tenant families potentially represents a significant opportunity for buy-to-let investors. By understanding the needs of these families and adapting properties accordingly, landlords can potentially benefit from stable, long-term tenancies and contribute positively to evolving housing trends. As the dynamics of households continue to evolve, staying attuned to these shifts could be crucial for landlords aiming to remain relevant and responsive in the market.  

FAQs

Q: What is a multigenerational household?

A: A multigenerational household consists of members from multiple generations of the same family living together. This often includes grandparents, parents and children residing under one roof.

Q: Why is multigenerational living becoming more common?

A: Factors such as economic challenges, cultural preferences and an ageing population contribute to an increase in multigenerational households. Families are finding value in shared living for financial, emotional and practical reasons.

Q: How can landlords make their properties more appealing to multigenerational tenants?

A: Landlords can seek properties with multiple bathrooms, flexible living spaces and separate entrances. Modifications such as creating self-contained units, installing accessibility features and enhancing soundproofing can also make properties more suitable for multigenerational families.

Q: Are there financial benefits for landlords renting to multigenerational families?

A: Multigenerational families often prefer long-term rentals, leading to reduced vacancy rates. Additionally, catering to larger households can expand the tenant pool and increase demand for the property.

Q: What challenges might landlords face when accommodating multigenerational families?

A: Challenges include obtaining necessary planning permission for property modifications, managing increased wear and tear due to more occupants, and ensuring that tenancy agreements meet legal requirements.