Multigenerational households are becoming an increasingly common living arrangement in Australia as rising housing costs and growing expense pressures prompt families to share homes across three or more generations. Data from the Australian Bureau of Statistics indicates there were 335,000 multigenerational households in 2021, marking a 22 percent increase since 2016 and signalling a trend likely to continue.
Research by investment firm Vanguard highlights that nearly one-quarter of working Australians expect to live with family members during retirement, compared with only 8 percent of current retirees. Daniel Shrimski, Vanguard’s Asia-Pacific managing director, attributes this shift to higher property prices, larger mortgage debts, and increasing cost-of-living pressures, which are reshaping traditional retirement expectations.
“Retirement success always used to be a fully paid-off home, but I think expectations are changing and Australians are having to think about ‘how do we do this differently?’” Shrimski said. He added that multigenerational living arrangements enable families to share expenses while fostering closer relationships.
The study, titled “How Australia Retires 2026,” also found that almost half of young adults anticipate carrying mortgage debt into retirement, raising concerns about their ability to maintain financial security once they stop working. Shrimski noted that cohabitation can take various forms, including adult siblings sharing a home or older parents living with their children and grandchildren.
Social researcher Mark McCrindle observed an increase in multigenerational households, describing it as a more efficient use of existing housing stock. He pointed to a growing market for home renovations and constructions, such as granny flats and separate living spaces within larger dwellings, designed specifically to accommodate extended families. McCrindle also cautioned that the rise in multigenerational living could complicate estate planning, particularly in families where only some adult children reside in the family home amid a broader $6 trillion wealth transfer from Baby Boomers to younger generations.
McCrindle highlighted cultural influences as another factor driving this shift. “Young people leaving home and living as separate family units is more of a Western thing,” he said. “As we’ve become more culturally diverse, a lot more of that approach has come into Australia.”
In Melbourne, Susana Le and her husband Chi-Lieng Be built a specially designed home to house Le’s retired parents, who arrived in Australia as refugees from Vietnam and Cambodia in the early 1980s. The home includes accessibility features and shared as well as private spaces, accommodating their parents’ needs while enabling family support structures to function effectively.
Le cited both cultural values and economic factors for their arrangement. “The rising living costs mean it’s not easy to have savings and security to reach beyond your retirement,” she said. She also emphasized the reciprocal nature of support, noting that her parents assist with childcare, enabling her to continue working.
Builders and developers report a surge in demand for multigenerational housing designs. Rhys Uhlrich, founder of prefabricated home company Shed House Australia, indicated about half of his clients are extended families seeking such arrangements. Meanwhile, Chris Thornton, chief operating officer of GJ Gardner Homes, said that under current economic conditions, housing multiple generations under one roof “makes good financial sense,” helping families distribute living costs including mortgage payments, utilities, and groceries.
As Australia faces ongoing affordability challenges, multigenerational living may become a more prominent element of the country’s housing landscape, reflecting changing economic realities and evolving social attitudes.