A new report from social research company McCrindle points towards a growing shift in how people are choosing to buy and rent property. Their latest research shows that 12% of Australians (1 in 10) are choosing multigenerational living arrangements.
The appeal of multigenerational living
Multigenerational living is where three or more generations reside in the same property. They may own the property as a joint mortgage or have another arrangement.
As the cost of living continues to influence buying decisions, there are obvious benefits in sharing living costs, childcare and elderly care. Beyond financial motivations, emotional drivers include combating loneliness and strengthening cultural family ties.
Key factors driving multigenerational living
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Young people are studying for longer to gain access to better-paying careers, but also accumulating a larger HECS debt. Therefore, the average age of a first home buyer is now 34-36, with 20% aged 40 or older.
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Many younger Australians are opting to invest in the interpersonal benefits of travel first, and own property later – they still save for a property but balance that with saving for travel as well.
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Generation X is often providing for young adult children while also caring for ageing parents. In 2006, 60% of 19-year-olds lived at home, compared to 70% in 2021.
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A cultural shift towards families with Indian, Asian and South-East Asian lineage who value intergenerational care and connection – a change from the independent 'succeed on your own' culture of post-WWII European immigrants.
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Many Australians work more than one job as they save for the future; however, some non-traditional income streams aren’t always assessed equally by lenders. Many prospective borrowers need to save for a larger deposit to offset serviceability measures, or a second person to buy a property with, such as a parent, sibling or significant partner.
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Lack of housing supply is another factor causing families to live together for longer under the one roof. With at least six million more homes required to meet population growth towards 2050, along with the necessary social and public infrastructure such as roads, schools and shopping centres, housing demand is not slowing.
What do multigenerational families want from housing?
Privacy ranks highest on the list of desired features. Amenities such as separate entrances, multiple living zones and bedroom suites, two kitchens, work-from-home spaces and additional parking are highly sought.
To this end, homes are being renovated or constructed to meet these criteria, with the confidence that there is a growing demand. Established builders now offer multigenerational home designs that provide flexible layouts under one roof.
Owner-builders can purchase multi-gen kit homes that organise private wings around social spaces – known as ‘connected independence’. Other families may add a small second dwelling to their property if space allows.
The widening gap between housing and income
Forty-five years ago, in the Sydney of 1981, the house price to income ratio was a five-times differential. The ‘Great Australian Dream’ was not just alive and well – it was thriving.
Fast forward 45 years to the Sydney of 2026 and the differential is seventeen times. Ten times for Melbourne and Adelaide. Eleven times for Perth and Brisbane.
| 1981 | 2026 | |
| Detached home in Sydney | $78,000 | $1.8 million |
| Average full-time Income | $15,000 | $107,000 |
| Differential of price to income | 5.2 | 16.8 |
This widening chasm between income and house prices explains why, on average, the dream of home ownership is shifting to later in life.
This trend is also spilling into the rental market, where multi-family living is increasingly common. Real estate agents across Australia have seen a noticeable increase in combinations of family members and friends teaming up to share rental accommodation they would have previously afforded alone.
Modern multi-gen succession planning
Beyond the bank of mum and dad, many grandparents are electing to pass on wealth to grandchildren before they pass, as they want to witness their accumulated assets making a difference to younger generations while they are still alive. This is a new trend in modernised thinking around traditional succession planning.
Beginning in 2030, it is anticipated that a significant generational wealth transfer will occur across age groups. Gen Y will have an average age of 40, and Gen Z an average of 25. This cohort may become a new wave of selective first-home buyers and property investors, moving out of rental or family home scenarios. Gen Y in particular will be in search of quality, environmentally conscious properties that match their established career income levels and values.
Buying property with family
More guidance on purchasing property with family members can be found in our online Family Property Guide.
Sources: ABC News; McCrindle.
Contact MCP
1300 510 816 or your Finance Partner
enquiry@mcpfinancial.com.au