Finding a home for several generations of one family comes down to two things: a layout that gives everyone privacy as well as shared space, and getting the legal and money questions right before you buy. A house with a self-contained annexe, a ground-floor suite or a converted outbuilding can work well, but annexes bring their own rules on planning permission, council tax and Stamp Duty that are worth understanding early.
This guide covers what to look for and the planning, tax, mortgage and ownership points that catch families out. It is written for England.
Multigenerational living means more than two generations of the same family sharing a home, for example grandparents, their adult children and grandchildren. The Office for National Statistics (ONS) uses exactly this definition in Census 2021, and it includes households where grandparents live with grandchildren without the middle generation.
On Census Day, 21 March 2021, there were about 528,000 multi-generational households in England and Wales, around 2.1% of all households. About 64% of them owned their home, either outright, with a mortgage or through shared ownership. In Cambridge the census counted about 730 such households (1.4%) and in South Cambridgeshire about 780 (1.2%). These figures do not include the more common arrangement of parents and adult children living together, which is only two generations.
Count bedrooms and bathrooms for everyone, then think about daily routines. Separate sitting areas, a second kitchen or kitchenette and a separate entrance all help each household keep its independence, with a large kitchen or garden as the shared space.
Plan for the next ten years, not just today. Step-free access, a downstairs bedroom and a level-access shower matter more as people age, and adapting a house later can be costly. Our guide to accessible homes and neighbourhoods in Cambridge covers what to look for.
Each generation will want something different from the area: schools for children, a commute for working adults, and GP surgeries, shops and bus routes within reach for older relatives who may stop driving. Our Cambridge area guides describe the city neighbourhoods and surrounding villages.
The usual benefits are shared housing and running costs, help with childcare, and being on hand to support older relatives. The common difficulties are less privacy, differing routines, and disagreements over money and household jobs.
Agree in advance who pays for what, how bills are split, and what happens if someone wants to move out, needs care or dies, and put the money side in writing (see the ownership section below).
Building regulations are separate from planning and you may need both. They apply to building work and to some changes of use, for example when an outbuilding starts to be used as a dwelling or a house is split into more dwellings. The exemption for small detached garden buildings does not apply if the building contains sleeping accommodation. You may also need approval to install a bathroom that involves plumbing. Without approval you will not have the compliance certificates you may need when you sell. Ask your conveyancer to check the planning and building control history of any annexe you are buying, including any planning condition that limits who can live in it, and read our guide to when you need planning permission.
If a property is altered to create two or more self-contained units, such as an annexe, each unit gets its own council tax band. In England two reliefs can then apply:
Apply to your local council. The rules in Wales and Scotland are different.
Whether an annexe is a separate dwelling for Stamp Duty Land Tax (SDLT) is a question of fact. HMRC looks at whether the occupants could live independently, with their own access and domestic facilities and the necessary privacy and security.
With a joint mortgage, every borrower is responsible for the whole debt if the others cannot or will not pay. A joint mortgage also links your credit reports. Some lenders offer joint borrower sole proprietor mortgages, where a family member joins the mortgage to increase affordability but is not named as an owner on the title. All borrowers are still liable for the repayments, and lender criteria vary. The supporting borrower has no ownership share, and some lenders do not allow them to live in the property, set a maximum age or require them to take independent legal advice, so check this if the relative will be moving in. An independent mortgage adviser can compare options and tell you what you can borrow before you start viewing.
When you buy with someone else you choose one of two types of ownership:
Families often put in different amounts, for example a parent's sale proceeds and a child's mortgage. A declaration of trust records each owner's share and is worth having from the start. MoneyHelper suggests speaking to a solicitor if you are not paying evenly towards the mortgage and deposit. No more than four people can hold the legal title to a property, although more people can have a beneficial share under a trust.
Step-free entrances, wider doorways, grab rails and a level-access shower help every generation. If a disabled person lives or will live in the home, a Disabled Facilities Grant from your local council can help pay for work such as ramps, a stairlift, a level-access shower or a downstairs bedroom extension. In England the grant is up to £30,000 (some councils give more), and how much you get usually depends on household income and savings over £6,000. The disabled person must intend to live there during the grant period, which is usually five years. Do not start work before the council approves your application, or you may get nothing. Planning permission and building regulations approval must be applied for separately.
This article is general information, not legal, tax or financial advice. Speak to a solicitor or licensed conveyancer, a tax adviser or an independent mortgage adviser about your own circumstances.
The ONS defines it as a household where people from more than two generations of the same family live together, including grandparents living with grandchildren. Census 2021 counted about 528,000 in England and Wales, around 2.1% of households.
Often, if it is a new outbuilding used as living accommodation or a separate home. Permitted development covers outbuildings for incidental uses only, not bedrooms, bathrooms, kitchens or separate accommodation, and using one house as two dwellings needs planning permission. Check with your local planning authority.
In England, an annexe is exempt if a dependent relative (aged 65 or over, or severely mentally impaired, or substantially and permanently disabled) lives there as their main home. Otherwise a relative living in it usually gets a 50% reduction.
Not if the annexe counts as subsidiary, meaning it is in the same building or grounds and the main house is at least two-thirds of the price, and you will own no other home or are replacing your main residence. If a separate annexe is worth more than a third of the price, the 5% higher rates apply to the whole price.
Up to four people can hold the legal title. More people can have a share under a trust.
If they are disabled, including age-related needs, you may qualify for a Disabled Facilities Grant of up to £30,000 in England. Apply through your local council before any work starts.
