10 April 2018
The City of Cape Town recently amended a municipal bylaw to allow owners the automatic right to build a second dwelling on most properties in Cape Town. The growing popularity in the Western Cape of the multigenerational-living trend is surely a contributor to that decision.
We asked two real-estate agency owners if they are seeing the same trend in other parts of the country. And it seems that this trend is on the upswing in Gauteng and KwaZulu-Natal too.
Brian van Wijk, Just Property franchisee operating in Centurion East, Centurion South, Midrand and Moreleta Park, says he has noticed an increase in his trading areas. Lawrence Homan owner of Just Property Margate and Berea has too: “On the South Coast (Margate, Ramsgate and Shelly Beach), we have noticed a definite rise in multigenerational living. And there’s been a substantial rise in Durban’s Berea area on the rental side.” Both say the reason for this is simple: cost saving.
“It is becoming more expensive to live in an unsteady economic, political and social environment,” says Van Wijk. “More families are therefore choosing this option to save costs and also to create a safer environment and security for all family members involved.” Young adults coming out of high school are remaining in the family home for longer, sometimes even up to their mid-30s, he says. These children usually contribute to the family income as a whole, raising everybody's standard of living.
Homan adds: “Some of our elderly were not educated well enough on saving for their retirement. As a result, they either work until very late in life or they move in with their children. But it can work the other way, and sometimes it is the children who are moving back home due to financial constraints. Whatever the reason, we find it multigenerational living arrangements usually include the grandparents, their adult children, and those children’s children. But it is not unheard of for siblings and their families to move in together should they find themselves in financial straits.”
In terms of the rental market, renting a property with your parents as co-tenants expands the options for both parties, and ensures help is on hand if the elderly need to be taken care of.
Van Wijk has noticed that this living solution is being implemented on a greater scale in the older suburbs where stands are bigger. “In such areas, there is the opportunity to build on an additional dwelling, either for children or for parents. We see it, too, in upmarket suburbs where the houses are big enough to accommodate several families, either within the home or in ‘granny flats’. Centurion really stands out in this regard with such suburbs as Lyttelton, Doringkloof and Pierre van Ryneveld leading the way. Midrand shows the next highest uptake of this trend. We see it less in Pretoria’s Moreleta due to fewer suitable properties, but when the property is suitable the buyers often turn out to be parents investing in accommodation where they’ll live in the house and their children can have their own flatlet on the property.”
When it comes to selling a house these days, the agents often find that all alterations for such living arrangements have already been undertaken. Homes have been extended and altered so they can be used by an entire family.
“We see couples who would previously have down-scaled, keeping their family homes for longer, and even buying bigger homes,” says Van Wijk. “These homes are extended and altered for the entire family. When it comes to selling such homes, we have no shortage of buyers looking for exactly this solution.”
Yes, in many cases the (older) kids or grandparents are living in “granny flats” but Van Wijk says that in both rental and sale scenarios, he is seeing more and more grandparents sharing bedrooms and spaces with children: “The parents (usually the owners paying the bond, or the tenant paying the monthly rental) will be using the main bedroom and the rest of the family members get divided into the other available bedrooms.”
Homan says he is seeing the same thing in KZN, especially on the rental side: “Finding a suitable property at a low rental that will accommodate everyone can prove difficult. Therefore, either the younger siblings share a room or the grandparent shares with a grandchild. Most of the time this rental arrangement is to save costs, so the preference seems to be a 3-bedroom free-standing house at a rental of approximately R5 500 to R10 000.”
”On the sales side, the majority of individuals are buying so that their parents can live with them while still retaining their privacy. Should the arrangements be under one roof, the parents normally have a ground floor wing to the house where they have a room, a small kitchenette and a bathroom. The main family then live in the other side of the house or in an upstairs portion. The ideal scenario buyers are looking for is a house with a granny flat on the property, a double storey home with a bedroom downstairs for the older folk, or a property that has a wing to the one side with its own bathroom, bedroom and kitchenette. On South Coast, prices for such a home are between R500 000 and R 1.5-million.”
Van Wijk says that the critical issue for buyers is what they can afford in their current financial situation “but everybody looking for a multi-generational solution is focusing on finding the biggest property, with the least amount of work/maintenance required, at the best possible price”.
He has found that in Centurion East, Centurion South, Midrand and Moreleta Park, entry-level townhouses of approximately 88 to 100 sqm in size, in a secure estate are especially popular. These units usually have 2 or 3 bedrooms, a private garden, and garaging. Properties of this calibre range from R780 000 to R 1.2-million.
“If the family’s budget and requirements are lower, a 2 bedroom apartment around the 75sqm range with 1 or 2 bathrooms is snapped up, especially if it’s modern, on the ground floor and priced between R650 000 and R850 000.
“Higher budget clients are looking for larger and more spacious 3 or 4 bedroom freehold houses in secure estates with the highest number of amenities in and around their home. Such properties, from 150 sqm to 250 sqm in size, range between R1.2-million and R1.5-million in my trading areas.
“If it’s a rental that clients are looking for, rental for a townhouse or high-end/ luxury apartment is around R8 000. In Lyttelton, probably the oldest suburb in Centurion, a 3-bedroom home on about 750sqm property can be rented for as low as R11 000 and a 4-bedroom home from R15 000. These homes provide plenty of space for accommodating multi-generational families.”
Multi-generational living has been around for as long humans have walked the earth. As Homan notes, this type of living was always more common in certain cultures and within the middle to lower LSM groups. “Within the higher LSM groups, the older generations either had sufficient funds to support themselves, or their children had the necessary funds to pay for their parents to move to a retirement facility with high care.”
With the rise in VAT, expected increase in living costs and decreasing job security, multi-generational living is likely to become more and more common amongst middle-class families, whose children in the past split from the nuclear family as soon as they completed their education. “It will remain a relevant trend as families try to reduce costs, upgrade standards of living and create a more secure and safe living environment.”
Van Wijk has a final word of advice: “Young people should make an earnest effort to purchase that first home – it forces them to save and ensures that they have a nest egg for their own retirement. I have enormous respect for the many sensible individuals and young couples I seeing buying their first properties in Midrand. They are not sharing. They are looking forward, planning and investing for their future. They tend to buy, stay short-term and then rent out the property. These ‘buy-to-let’ buyers are the ones who will be set for retirement. Sharing with their family will be a choice not a necessity.”
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