- Rising unemployment, high cost of living and black tax contribute to the multigenerational trend in South Africa.
- Students, single parents and retirees are staying at home to save money, or simply to survive financially.
- Multigenerational living also beats loneliness.
Multigenerational living, where families of two or more generations of adults live under one roof, is a growing international trend. In the US, one in five people live this way. They are mainly young adults staying in the family home for longer, or moving back in with parents while looking for work. A higher cost of housing has influenced this trend in Australia and the UK, while in South Africa, this is affected by rising unemployment rates, a higher cost of living, and cultural custom. According to Statistics SA, 32.2% of South African households are multigenerational.
Reasons for multigenerational households
- Students studying for longer and staying at home to save money
- Single parents and retirees depending on staying with family for financial survival
- Need for companionship
- Black tax
Impact of black tax
A 2017 study found that 70% of working metro South Africans are already, or expect to be, supporting older family members – a responsibility known locally as “black tax” because it is rooted in the legacy of Apartheid era, which denied black South Africans the opportunity to accrue wealth that could be passed down through the family. As a result, older generations are dependent on the young professionals in their family for support. “Caring for our families is one of the main reasons why we work as hard as we do, and providing financial assistance while you are home is the right thing to do,” says John Manyike, Head of Financial Education at Old Mutual. “But at the same time, it’s very important not to overdo it and risk your own financial security.”
Those who can afford to start building a property portfolio early in their careers are wise to do so. Many buy and live in their first home for the short term, eventually renting out the property while they look for their second home. Budgeting for that kind of property portfolio growth can begin with ooba home loans’ range of home loan calculators, which can help prospective buyers work out what they can afford on a bond before going the prequalification and application route.
Where to buy
Steyn City in Gauteng, Val de Vie in the Western Cape and Kindlewood Estate, Umhlanga (which incorporates Mt Edgecombe Retirement Village) are some of the well-known estates around South Africa that cater for multi-generational living.
Areas with bigger stands lend themselves to development and the City of Cape Town has amended a municipal bylaw to allow owners the automatic right to build a second home on most properties in the municipality. In Gauteng, Centurion, Lyttelton, Doringkloof, Pierre van Ryneveld and Midrand can cater to this trend while Durban has more spacious properties along the South Coast (Margate, Ramsgate and Shelly Beach) as well as on the Berea.
In Port Elizabeth, a residential estate that incorporates a variety of villages catering to multiple generations is getting traction from buyers across the board. Whole families are investing in the estate together because living in the same zone, and not necessarily in the same home, comes with its own unique set of benefits. Young children reap the rewards of living in close proximity to their parents, grandparents and other relatives and vice versa. Estates that include a retirement village in their multigenerational home plans also fulfil this need.
If you’re looking ahead and expect to be a homeowner who contributes to this multigenerational living trend or think your family might want to buy a home together with the help of ooba home loans, click here to access the free, online prequalification tool, the ooba Bond Indicator that can help you work out what you can afford. Then, when you’re ready, you can get prequalified or apply for a home loan with ooba home loans.
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