How to make it work for you here
Tough economic conditions globally are increasingly forcing people to look for innovative housing solutions, and among the most popular current trends are dual living that provides a rental income stream and multigenerational living that cuts down on costs.
Both options benefit from – and depend upon – numerous people peacefully co-existing on the same property, though, which can present unique challenges. And if you’re considering converting a property for dual living, there are also practical and regulatory issues that need to be taken into account and addressed.
Multigenerational living is a growing world-wide phenomenon that’s becoming more prevalent as spiralling costs make it difficult for families to make ends meet and for youngsters to leave the nest.
And according to Lew Geffen Sotheby’s International Realty Executive Director Sandy Geffen, who has more than three decades of property industry experience under her belt, South Africa isn’t immune to this trend.
“Young adults are living with their parents for longer, affordable retirement accommodation is in short supply and home ownership is frequently delayed for years as young families and first-time buyers now have to save for bigger deposits,” says Geffen.
According to the last South African Census, just over 50% of the country’s households are multigenerational, reflecting a study reported in Time Magazine last November noting that more young adults (aged 18 to 34) in the United States are living with their parents now than at any time since 1940.
And while economic necessity may be the current primary driver behind families needing to share properties, Geffen says there are several advantages to this type of arrangement that mitigate the reduced amount of personal space.
“There’s always a silver lining to be found in any challenging situation and in this instance there are several, even if it’s a case of three generations squeezed into one not overly large home.
“Shared expenses ease the financial burden and allow for a better quality of life. Sharing a home can also strengthen family ties in a world where the traditional family unit is far less common than a generation ago.”
Few families today can afford a stay-at-home parent and many are finding it difficult to cover the costs of childcare, so in this way the need for care for both grandchildren and grandparents can be seamlessly accommodated.
Multigenerational living also offers increased security for homes as they’re not unoccupied for long stretches during the day, as well as for elderly family members in general, who would be more vulnerable to targeted crime if they were living alone.
Planning, flexibility and ground rules are essential to make it work for everyone in the long term, because unless all parties buy into the household ethos it can go horribly wrong.”
The following guidelines will help to avoid pitfalls and maximise the benefits:
- Discuss and agree on each person’s responsibilities from the get-go and if anyone requires care or assistance, establish what this entails and how it should be implemented;
- Discuss and establish boundaries together as they must be understood and respected by each household member, from the youngest to the eldest;
- Learn to pick your battles – there will be general disagreements and niggles, but most won’t be worth a full-scale argument; and
- It is important to remember that living on one property doesn’t mean living in each other’s pockets. Everyone needs a break from each other and time to themselves.
Dual living with a paying tenant on the property is also an increasingly attractive option for cash-strapped home owners and prospective buyers looking to reduce their mortgage burden or purchase in high-demand areas that stretch their budgets.
A rental income can help to pay off your home loan faster, and also enables first-time buyers to enter the market sooner. It might take a bit of time to find the right property, but it’s worth the effort in the long run.
And in a country where fewer than 10% of retirees are financially independent and the Reserve Bank notes that we have one of the worst savings records in the world, Geffen says dual living is also an excellent way to help fund retirement.
The most important factor for successful dual living is to ensure all inhabitants enjoy a measure of privacy. Geffen advises home owners to carefully consider their needs and decide whether a separate, self-contained dwelling would be most suitable or if converting or extending existing structures would suffice.
“Cutting corners to save a few rands in the short term often proves costly down the line, especially when you decide to sell and the sale is delayed or lost because the property plans don’t match the current structures.”
Sandy Geffen also cautions home owners to guard against the most common pitfall, over-capitalising, which will not only diminish return on investment in the long term but could also defeat the object of earning a decent income in the short term because the costs outweigh the revenue.
In the current economy, whether you want to off-set the rising cost of living or simply create a new income stream, dual living makes a lot of sense. If implemented correctly it has far more benefits than disadvantages and will add substantially to the value of your property when you eventually sell.[/vc_column_text][/vc_column][/vc_row]