Pandemic May Force Overhaul in Housing Stock
December 11, 2020
The COVID-19 pandemic is influencing housing decisions for people in all age groups and changing what they need in a home, experts said Thursday during the National Association of REALTORS®’ virtual Real Estate Forecast Summit.
The need for multigenerational housing has grown, with 15% of buyers looking for such a home since the pandemic began, according to NAR’s 2020 Profile of Home Buyers and Sellers. The majority of these buyers say they need space to care for an aging relative. The potential cost-effectiveness of living with family is also motivating buyers to consider multigenerational homes. “We don’t know if our current housing stock will be able to support that need,” said Jessica Lautz, vice president of demographics and behavioral insights at NAR.
About 106,000 nursing home residents nationwide have died from COVID-19 since the pandemic began, said Rodney Harrell, vice president of family, home, and community at AARP. As a result, more people are choosing to bring their elderly loved ones home, and they’re looking for housing options to accommodate them, such as accessory dwelling units, backyard apartments, and homes with first-floor owner suites. Also, the need is growing for more universal design features, such as no-step entries, to better accommodate aging in place, Harrell said. Multigenerational housing can accommodate not only aging parents but also young adults moving back home, added Richard Fry, senior researcher at Pew Research Center.
About 20% of the U.S. population lives in a multigenerational home, mostly due to an increase in 25- to 29-year-olds living with their parents, he said. Some demographic groups may prefer multigenerational living, which also adds to the uptick, Fry said. “We expect to see continued growth in multigenerational living as our population grows more racially and ethnically diverse,” he said. Agents should work with their buyers to ask questions about their needs and understand their preferences.
Larger homes will be in higher demand, which could accelerate suburban growth, Lautz added. However, housing shortages have limited buyers’ options and created steep competition. Baby boomers and millennials show similar preferences for suburban homes near parks and services. But “are we going to have the type of housing that people want and need?” Harrell said.
The majority of neighborhoods in the U.S. are zoned for single-family housing. But Harrell said more housing variety is needed, not just for accommodating multigenerational households but also singles, couples, and roommates. Lautz said that during the pandemic, more unmarried couples and roommates are buying homes together. “They may have rented together in city centers and now are deciding to go buy a home together in the suburbs,” she said.
The housing market is missing “middle housing,” such as two-flats, triplexes, accessory dwelling units, and other homes that may help more Americans find the option they need, Harrell said. “There will likely be an overall impact in the longer term on housing preferences coming out of this pandemic,” Harrell said. “We need to make sure we can meet it.”