Multigenerational homes are a very particular type of real estate and so require a specific approach. And of course, brokers know all about its distinctive features.
As a private individual, it’s best to be well informed when searching for this kind of property or, conversely, putting your own multigenerational home on the market.
Good Resale Value
Purchasing or converting a house into a multigenerational home can prove a lucrative investment. Indeed, this type of property has a generally higher resale value than a traditional home, over 15% on average, due to the flexibility it offers families seeking some form of multigenerational housing. However, it may stay longer on the market than a single-family residence.
Can It Be Converted Back into a Single-Family Home?
Another point to consider is the option to turn the house back into a single-family dwelling. This may even impact its resale value! Such versatility is especially appealing to potential buyers who will only need a multigenerational home temporarily, maybe a few years, for example.
When visiting this type of property, it may be wise to check if the renovation was carried out with the ability to return easily to the original single-family layout in mind. Sometimes, this may only involve simple changes, like removing a second kitchen or restoring a front entrance. Whereas other homes, designed to serve a multigenerational function from the outset, may require more extensive modifications.
A Growing Market: What Do the Numbers Say?
Currently, real estate reporting in Québec doesn’t systematically compile data on the multigenerational housing market. Nevertheless, according to Statistics Canada, in 2021, there were 50,790 multigenerational households (at least 3 generations of the same family living together) in Québec. Furthermore, the proportions of multigenerational households in Canada rose by 37.5% between 2001 and 2016.
Interest in this type of co-living arrangement is therefore increasing. A trend sustained by an aging population and the high costs of seniors’ residences, which is driving more and more families to choose multigenerational housing. In view of all this, a multigenerational home certainly seems like a sound investment!
Know the Rules
Are you looking to purchase a house to transform it into a multigenerational residence? Some municipalities impose certain constraints on multigenerational renovations. These may include the secondary dwelling’s size, private entrances or the number of mandatory parking spaces. Buyers must make absolutely certain the property complies with local bylaws. Sellers, for their part, must check that all requisite permits are in order.
What About the Mortgage?
No changes here! The loan approval process is the same as for any type of real estate and will be granted based on your credit score, your ability to repay the mortgage and the house’s value. Nor do any differences exist regarding legalities unless both then parents and children wish to become co-owners. In this case, the buyers will have to hire a notary to draw up an undivided co-ownership contract.
As Always, Don’t Skip the Inspection!
When acquiring a multigenerational home, ensuring each dwelling’s systems were correctly installed is important, especially the plumbing, heating and electricity. A detailed inspection will confirm that the two units are functional and meet safety standards. For example, an additional kitchen or bathroom must be adequately insulated and provide proper ventilation. Checking that each unit has appropriate heating and security systems is equally recommended to guarantee all occupants’ comfort and safety.
By taking the time to do research, talk to experts (like a broker), and verify bylaw compliance, both buyers and sellers of multigenerational homes can reap the rewards of a smooth and lucrative real estate transaction!