Are you considering a renovation to build separate living quarters for your adult children or parents? If so, you’re not alone. Multigenerational living is an option many Canadians explore at some point. Children are staying home longer to save up and buy a place of their own, and retired parents are moving back in with their adult kids to help out, while also looking for an affordable place to call home throughout their golden years.
Using equity you’ve built up in your home is the most cost-effective way to fund your renovations – either through a refinance or a home equity line of credit (HELOC). And, with interest rates at all-time lows, now’s a great time to consider making some changes to your home. Once you qualify, you can typically borrow up to 80% of the appraised value of your home.
Planning is important
The cost and scope of the project are really important to pinpoint early in the process. How many rooms will be required for your children or parents to live comfortably? What’s your budget? Who’s paying for the renovations? How will the ongoing maintenance and household expenses be shared?
While bringing two households together often makes sense from a financial standpoint, it’s also important to ensure the new living arrangement has a high probability of success before spending money on major renovations.
You don’t want to risk putting yourself and your family in financial jeopardy if you decide to renovate and then no one ends up moving in – or staying for a long enough period of time to justify this kind of expenditure.
Other considerations
Aside from financial benefits, if you decide to proceed with multigenerational living – whether it’s your adult children or parents moving into your household – it’s important to set mutual ground rules, particularly where privacy is concerned.
Each person – including grandparents, parents, children and grandchildren – must have their own designated areas of the home. People feel most at ease when they have their own space to relax and unwind without others entering that area.
Communication is key, both before your kids or parents move in and once you’re all living together. Regardless of how well your family gets along, multiple adults living under the same roof can create tension. And daily conflict will only make the living arrangements progressively more stressful.
For some families, the decision to live together makes perfect sense. Only you can know for sure after weighing the pros and cons together.
If you decide that having your adult children or parents move into your household is right for you, your mortgage agent can help you fund your renovation plans. .
Have questions about your renovation financing options? Answers are a call or email away!