In a tough housing market, more and more young people are opting to stay living at home for longer.

But there is another growing trend — baby boomers moving back in with their adult kids. And it is by choice.

Research suggests about one in five Australians live in a multi-generational household — and that number is on the rise.

Perth home builders are reporting an increase in demand for homes designed specifically for more than one generation and they are tailoring their offerings in a bid to cash in.

The Antcliff and Gregson family

When Sandra and her husband Mark decided to build a home in Serpentine, south of Perth, a standard three-by-two was not going to meet their needs.

Having only recently lost her husband, Sandra's mother Linda Gregson was diagnosed with cancer, and the Antcliffs decided they wanted her nearby.

In fact, they wanted her living under the same roof.

Sandra and Mark Antcliff said ground rules were important, especially for children. ( ABC News: Rebecca Trigger )

They designed their four-bedroom, three-bathroom home on an acre block with a separate two-bedroom wing they call the "granny annex".

"We wanted for Mum to be able to come and go from her house without us knowing really, so she had her independence," Ms Antcliff said.

"It was quite stressful at times. I think we put Mum before ourselves sometimes to make sure it was right for her. Then we would sort out how it would work for us."

Ground rules make for smooth transition

According to both Ms Antcliff and her mother, having a separate front door was a real sticking point.

"I didn't want to feel as though I was living in rooms in their house," Ms Gregson said.

"I needed to know that was my front door, I can have friends over, I could come and go as I please."

Having her own front door was very important for Linda Gregson. ( ABC News: Rebecca Trigger )

And some ground rules had to be laid.

"We were very strict with the kids when we first moved in, that they weren't to just go barging into nanna's," Ms Antcliff said.

"They had to go and knock. A courtesy knock before they walk in. We'd say this is her own house and this is our house. They are separate."

A number of builders, including Perth's Gemmill Homes, have started marketing housing designs specifically for multi-generational living.

Managing director Craig Gemmill said he was surprised at the level of interest.

"The whole thing with this multi-generation living is to give whoever is occupying that room just a little bit more space, a bit more privacy on their own, but certainly they can join in with the rest of their family if they want to," Mr Gemmill said.

"Here in Western Australia where the Government is actively pushing infill, trying to stop the sprawl a little bit, I think this is going to be part of it.

"If we can show the general community that you can incorporate these styles of dwellings into an existing block of land, in an existing suburb, once we create the awareness I think the demand will increase."

The Bruyninckx and Feary family

Having watched their daughter struggle with a big mortgage and deal with health issues, John and Julie Feary wanted to do something to ease the burden on her and her young family.

Members of the Feary and Bruyninckx family spend a lot of time together. ( ABC News: Charlotte Hamlyn )

They moved out of their home in Bateman, taking up residence in a granny flat they built next door and leaving Chrissie Bruyninckx, her husband Matt and their daughter Elena to move into the original dwelling.

"We knew it would be a help for them, but if it wasn't going to work for us as well it wasn't going to be a good solution," Mr Feary said.

"In a way I think we had to convince them that it could work, that we wouldn't be in the way, that sort of thing."

Julie and John Feary wanted to ease the burden on their daughter and her family. ( ABC News: Charlotte Hamlyn )

It means Mr and Ms Bruyninckx, who both work full time, have a couple of extra sets of hands to help raise their young daughter.

But they are careful not to take advantage.

"Being close by has allowed us to look after each other," Ms Bruyninckx said.

"We cook for each other, we spend a lot of time together.

"It's been really beneficial for us, obviously financially but even more so in having people we trust and people we know to be able to look after Elena.

"But we try not to burden them too much."

Matt, Chrissie and Elena Bruyninckx have found intergenerational living beneficial. ( ABC News: Charlotte Hamlyn )

New name needed for 'granny flats'

Builder Summit Homes has seen a reasonably modest 10 per cent increase in granny flat sales over the past year, but has seen a 54 per cent increase in inquiries about them.

The company's general manager of new homes, Tony Harvie, said granny flats were a major focus for the business.

"The first thing is, I think we've got to find a new name for it," Mr Harvie said.

"We still call them 'granny flats' but probably only one-third of the homes that we build would actually go to a grandparents-style arrangement.

"People are using them for holiday accommodation, rental accommodation, all manner of things.

"If circumstances change, if they want to develop the block later or anything happens at all, they can crane the granny flat out and sell it or move it to a different location.

"Gone are the days where they want to just build a weatherboard thing out there that will last a couple of years."

Tony Harvie said a new name was needed for granny flats. ( ABC News: Charlotte Hamlyn )

Dr Edgar Liu from the University of New South Wales is one of a small number of Australian academics who has done research into multi-generational living.

He said it was a common way of life in many parts of the world, and agreed it appeared to be increasing in Australia.

"Across Australia about one in five people live in a multi-generational household," Dr Liu said.

"The fastest growing age group for multi-generational household members are over 65s, partly because there aren't that many that lived in this kind of arrangement back in the 1980s.

"But we are generally seeing a greater change in terms of the number of older people living in this kind of arrangement."

Changing perception of 'normal family'

Dr Liu said much of that increase was driven by a desire for baby boomers to stay living at home, rather than move into residential aged care.

"In the survey that we did, more than half of the people said that finance was one of the reasons why they did it and there are many different subcategories in that," he said.

"Certainly for a lot of our participants, they said, 'Well I can't bear the thought of sending my mother to a home, I would much rather have them live with me, I can take care of them much better than any professional can'."

He said changing attitudes about what a "normal" family looked like were prompting many people to explore different living options.

"How families actually work has changed quite significantly in the last 20 or 30 years," Dr Liu said.

"There are a lot more blended families now, there are a lot more break-ups than we've seen before and that has a lot of different implications.

"Quite a few of our participants actually end up in this arrangement because of a divorce, whether it is in their 30s or 40s or in their later life. That certainly was one of the many drivers."

But Dr Liu said multi-generational living came with plenty of challenges, and was certainly not suited to every family.

"One of the things people like most about living in this arrangement is the companionship, but of course when there are so many of you living in the same house, you are bound to rub each other up the wrong way every now and then," he said.