When your granddad says his apartment is hunky-dory, it sounds like he has no complaints. Hunky-dory
is American slang that means all right, satisfactory, or fine.
Hunk was used in the children's game of tag to mean home base where a player was safe or all right. The word's from the Dutch word honk, which means station or goal. Dory, however, is less defined. Some etymology resources associate it with the Japanese word for a main street, dori. In the Japanese port city of Yokohama, you'll find a road named Honcho-dori. (Notice its similarity to hunky-dory?) In the 1800s, Honcho-dori was a destination for sailors looking for entertainment.
In Sinclair Lewis's Babbitt, Vergil Gunch tells George Babbitt
"George, old scout, you were soreheaded about something, here a while back. I don't know why, and it's none of my business. But you seem to be feeling all hunky-dory again . . ."