- Co-Living 2.0 Trend Stronger Than Airbnb and WeWork?
- What is Co-living?
- Is Coliving the New Airbnb?
- Coliving in Europe
- Why the Demand for Coliving?
- Unique, Rare Living Opportunities
- What are The Benefits of CoLiving?
- What’s the Downside to Coliving?
- Technology Key to Success of CoLiving
- Here’s What You Need to Know About Co-living, the Latest Housing Trend
- A New Twist on an Old Idea
- The Benefits of Communal Living
- An Adventurous Spirit Required
- Finding the Right Rental Unit
- Cheap Housing and Built-in Friends
- What is Coliving? Pros and Cons of Coliving
- What is Coliving?
- What Does a Coliving Space Look ?
- How Do Rent Payments Work?
- What's Included in the Rent?
- Pros of Coliving
- 1. More Bang for Your Buck
- 2. Reduce Roommate Conflicts
- 3. Living With -minded Individuals
- Cons of Coliving
- 1. Limited to Major Cities
- 2. No Control Over Roommate Selection
- Is Coliving for Me?
- Final Thoughts
Co-Living 2.0 Trend Stronger Than Airbnb and WeWork?
Is the growing interest and investment in common living going to solve the US housing problem? Is it a threat to traditional home ownership and rental housing leasing?
Coliving appears to be a housing market trend to note and it’s in your neighborhood already. Airbnb short term rental and Wework office sharing, it has its reason for existing and it’s not a fleeting trendy niche. In fact, it may be the next business opportunity for property managers and investors.
KnightFrank in their research study calls the phenomenon “renting a lifestyle” in the world of plug and play living.
How popular is coliving? Recently, NYC based co-living operator Common teamed up with a Los Angeles developer to create a new development in Los Angeles.
There were 9000 applications for spaces in 24 units. The founder of the company stated that “We see huge demand in Los Angeles for shared furnished apartments that rent for $1,300 to $1,800 per month.
” But is lower price all that tenants are looking for?
Screen capture courtesy of Coliving.com
What is Co-living?
Co-living as it’s name implies is a housing arrangement of any lease period where renters share common areas of a home or apartment unit such as kitchens, living rooms, and other amenities with other tenants yet have a private bedroom.
Since most Millennial renters have shared student housing experience, this new trend to shared living spaces isn’t foreign to them. The sheer size of the Millennial generation means developers and investors (and property management companies) don’t need to cater to other demographics.
Millennials are driving coliving development just as they are with shared office spaces. Is this a threat to the mulitfamily housing sector? It’s a unique market serving unique renter needs, but perhaps in the end, it’s just another segment of the multifamily housing market.
Is Coliving the New Airbnb?
Some suggest coliving is part of the huge sharing economy. That connection might be weak though as the real goal of millennials is better lifestyle, freedom, and career growth. The demographic segment which coliving operators typically target are Millennials with incomes between $40k to $80k.
A new era called Coliving 2.0 is targeting more upscale tenants. The luxury trend is to watch for since the new accommodations might surprise those who think this is downscale living.
Millennial growth in other countries is far greater than in the US or UK. Technologies and growth generated in countries such as India and China will arive in North America, UK, Germany and Australia.
Coliving in Europe
Quarters of Berlin, a subsidiary of the Medici Living Group is building 35 new developments after a $1.1 billion fundraising round with Corestate Capital. $300 million of that is slated for the US.
Screen Capture courtesy of goquarters.com
Why the Demand for Coliving?
Wework, Welive, what’s next, WeSubway? See what a day in the life of a coliving person looks in this HBO series video.
Common has plans to build a new $200 million development in Los Angeles. As more data regarding data and ROI come in, more investors will be interested in these types of coliving developments.
Here’s how Common approaches the new market of coliving developments
Coliving has its similarities to college dormitory lifestyle and housing model yet clearly advanced amenities and increased privacy make it different. The initial attraction might be lower rents, however a quick check of coliving rent prices shows they aren’t as low as expected.
The lower coliving rents get the attenion of graduating students and others who need affordable accommodations or who want to save for a downpayment on a home purchase.
Is coliving as a multifamily housing segment going to take off? In congested urban areas such as San Francisco and New York, the colving concept is taking off. Rents are high enough per renter to add up to substantial revenue for a building.
And this is why investors are starting jump on the coliving opportunity.
Unique, Rare Living Opportunities
Visit websites such as ollie.co and right away you’ll see their unique value proposition beyond saving money. If rents aren’t super low (20% less on average than competing small apartments), then the property, leasing terms, and community have to prop up the value proposition.
Screen Capture courtesy of Knight Frank
The location of coliving developments near ski resorts, vacation destinations, major downtown business districts, and in wonderful cities shows coliving may be a window into a dreamed of lifestyle or career. Given the rent prices in Manhattan and Silicon Valley, coliving might be a window into a better life for many millennials and the leading edge of Generation Z.
Ollie has locations in Boston, Pittsburgh, Los Angeles and New York City.
There’s no limiting the imagination as developers consider coliving creativity.
What are The Benefits of CoLiving?
- better affordability in expensive cities
- shorter commutes to work
- access to downtown amenities
- better access to jobs in downtown districtions (e.g., Wall Street)
- cleaning services, laundry, free wifi, and other perks
- fully-furnished units
- more social than living alone or in hotels
What’s the Downside to Coliving?
In one report in the UK’s guardian newspaper, a reporter who is a nomad digital copywriter tells of her coliving experience in New York City. For her, coliving beats hotels by being cheaper, and she felt less lonely with others around. She met some interesting people from around the world.
However the tight spaces, NYC traffic noise and loud conversations of other tenants were not her cup of tea, but that’s NYC isn’t it? The lack of refrigerator space meant she could only store small amounts of food — inconvenience, more time shopping and higher grocery bills.
Yet the downside of co-living is ly something developers are working on. More washers and dryers, larger refridgerators, living space re-design, higher quality appliances, more sound insulation can mitigate the frustrations.
Technology Key to Success of CoLiving
Millennials drive this housing segment and they love new technology. With technology as amenity growing in importance, and on demand property management in vogue, there’s lots of interest in proptech solutions.
From keyless entry to IoT refrigerators and energy efficient lighting controls, to online tenant portals and 5G possibilities, proptech is entering its time in the limelight.
Keeping up on property management technology is tough, so please bookmark this page and pass it onto friends on who might to know rental housing trends will affect them.
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Here’s What You Need to Know About Co-living, the Latest Housing Trend
As the sharing economy continues to gain momentum, renters are finding that they can save money in pricey urban areas by moving into shared housing.
The success of Uber vehicles and Airbnb vacation rentals has shown that the public is receptive to the idea of sharing resources to reduce costs. That level of comfort is now extending into living arrangements in the form of co-living spaces.
A New Twist on an Old Idea
Co-living has strong appeal for millennials, the children of the baby boomers, notes Ryan Shear, principal at Property Markets Group (PMG), a company that develops co-living complexes. And where millennials go, the rest of the country often follows.
“At 75 million, millennials, now ages 21 to 37, are the largest working generation,” Shear says. “The places they choose to live are a sign of where the economy will grow.”
While “co-living” is a new term, the concept of shared living spaces is an old one. People who rent out a spare bedroom in a single-family home are engaging in a form of communal living. The rooming houses that were popular in the U.S. during the 19th and early 20th centuries were examples of reducing rental costs by offering tenants private bedrooms and shared common areas.
Today’s co-living apartment buildings are giving landlords an opportunity to make more money by charging less for individual tenants but more for rental units overall. Some development companies are contracting with apartment owners to remodel existing complexes.
The idea is to modify apartments to accommodate more residents in co-living units. In some cases, the roommates may be selected by a landlord and required to sign individual rental agreements. Apartment managers may seek to bring tenants with similar interests together in the same unit.
The Benefits of Communal Living
- Affordability in expensive cities
- Shorter commutes
- Access to downtown amenities
- Cleaning services and other perks
- Community events
Pogue says a willingness to share a home with strangers can give people access to expensive urban communities without facing the high cost of maintaining their own place. Co-living “results in shorter commutes, access to vibrant nightlife, and abundant retail with restaurants galore,” he explains.
Some co-living apartments come with cleaning services. This eases the pressure of sharing a home by making sure you don’t have to pick up after a messy roommate. There also may be private storage areas and private kitchen cabinets to make sharing an apartment more appealing. On the downside, co-living can mean giving up a great deal of privacy.
An Adventurous Spirit Required
Co-living seems to be here to stay! https://t.co/q93LF9uMLC pic..com/hNhEgMwfIx
— John & Donna Bonneau (@BonneauTeam) February 3, 2019
Sharing a home requires an adventurous spirit. If you move in with someone you don’t get along with very well, you probably won’t be happy no matter how much money you save. Differences can arise over such things as loud music or missing boxes of corn flakes. A common flashpoint is differences over cleanliness. Just think of the “The Odd Couple” TV show.
If you decide that co-living is something you’d to try, make sure you understand your legal responsibilities and your rights as a tenant. Your rental agreement should have terms you can live with.
New York attorney David Reisher, CEO of LegalAdvice.com, says you’ll be taking a chance if you sign a lease that makes you liable if one of your roommates skips out without paying their rent. But most co-living arrangement circumvent this, because each tenant has an individual lease within the shared space. Still, you need to read your contract very carefully.
If you enter into a co-living arrangement that doesn’t allow you to choose your roommates, be sure to ask the landlord if you will be able to change apartments if conflicts surface.
Finding the Right Rental Unit
Quarters to bring co-living spaces to more cities in the country! https://t.co/dHhvzEkwx3 pic..com/yQynOT8cpL
— Bruce Bright (@BrightSideTeam) February 4, 2019
Florida architect Jacqueline Gonzalez Touzet, a founding principal of Touzet Studio, says the best way to find a good co-living situation is to chat with people who already live in such complexes.
They can tell you the pros and cons of each building. You also can search online for reviews. Pay close attention to reviews that tell you how well co-living apartments are managed.
Try to find out what kinds of amenities are offered.
In 2017, PMG became one of the first major developers to embrace the co-living market. Its apartment projects include lobbies that are designed to be social hubs for residents, complete with bars and restaurants. The idea is to make people feel they’re part of a desirable community.
“Developers have definitely taken notice of the demand for co-living,” Shear says.
He notes that PMG has more than more than 10,000 units in the development pipeline across the U.S. They are expected to open over the next five years.
“We have projects currently open in Chicago and Miami, with planned communities in Fort Lauderdale, Denver, Phoenix, Oakland, and beyond,” he adds.
Not all co-living apartments are part of large complexes. Gonzalez says some have been opened in small brownstones. Units often are marketed to specific groups, such as graduate students, young professionals, or health enthusiasts. The idea is to attract and retain tenants who enjoy the company of -minded people.
Cheap Housing and Built-in Friends
Embed from Getty Images
It’s too early to tell if the co-living trend will last. People who reside in such apartments gain cheaper rent and the opportunity to connect with people who share their home.
However, the nearness to neighbors could be a turnoff for some renters. If you have to share a kitchen and a living room with strangers you don’t get along with, co-living could quickly lose its charm.
All of that togetherness could turn out to be too much of a good thing.
On the other hand, buying a home and even renting an apartment in a major city New York or San Francisco is still reach for millennials and members of Gen-Z. Which means communal living might be born necessity more so than a choice, at least in dense urban markets.
People who decide to try it out should think hard about how much how much they value their privacy. If you’re a highly social person who thrives on being around other people, co-living may be just the right thing to bridge the affordable housing gap.
What is Coliving? Pros and Cons of Coliving
Making a move to a new city can feel a wild adventure. You've got places to explore, people to meet, and tons of things to do. The very first step is finding a place to call home.
It's no secret that many major US cities lack affordable housing. That can put a damper on your big city dreams.
To combat exorbitant housing costs, people take to the timeless tradition of cohabitating. In short, they get roommates.
However, the new housing trend of “coliving” adds a modern twist to this tradition.
People have compared coliving to dorm life and communal living. Some people don't see how it differs from the standard roommate living arrangement.
However, coliving is its own entity. It has distinct features that make it a unique option for apartment hunters. But is coliving right for you?
This guide has everything you need to know about coliving and whether you should consider coliving during your apartment search. Let's dive in!
What is Coliving?
Coliving is a new rental trend. It’s a type of shared housing arrangement that has grown in popularity within major US cities.
Companies offer shared living spaces in which each resident has their own bedroom with shared communal spaces. This may sound similar to a typical roommate situation.
However, coliving differs in a few key ways, including:
- The promise of living with -minded roommates.
- Access to a large coliving community.
- Luxury amenities.
- Lower living costs compared to the traditional shared living arrangement.
- Reduced roommate conflicts.
Coliving has cornered the market of new residential housing in big cities Los Angeles and New York. Those who move to these major metropolitan areas generally turn to shared housing to reduce costs. Unfortunately, shared living situations have had a bad reputation.
It can be difficult to find a roommate that matches your lifestyle. Conflicts regarding money, cleaning, guests, and pets crop up. Inevitably, those things sour the relationship.
Moreover, cost-cutting measures often mean that luxury amenities are reach for many new residents. In short, moving to a new city, finding decent housing, and matching with a great roommate is a herculean task.
Coliving offers a solution to this problem. By matching residents within a space, providing cleaning services, individual lease agreements, and offering luxury amenities, coliving companies make shared living arrangements an attractive option for new residents.
What Does a Coliving Space Look ?
Coliving spaces are very diverse. However, as they’re typically based in large cities, the backdrop usually remains the same. Depending on the company that you work with, you'll have a wide variety of homes to choose from.
In Los Angeles, you might find a listing for a 144 sq. ft. bedroom within an apartment unit, including a shared bathroom and communal spaces. You can find a coliving apartment unit with two bedrooms and exposed brick in NYC.
As a part of their appeal, most coliving apartment units come with fully furnished communal areas. You'll typically find modern furniture and classy artwork.
They’re decorated in a way to maximize openness and coziness. So, you don't have to worry about living in a space that looks a model home.
You’re free to bring your own belongings to liven up your bedroom space. However, you won't need to include any essentials such as toilet paper, dish soap, or paper towels on you.
Among the in-unit amenities, there are sometimes additional communal spaces. Those may include gyms and outdoor areas that are free to use for any coliving unit residents.
These amenities are more common in coliving spaces within apartment buildings or larger homes.
How Do Rent Payments Work?
As one of the most common roommate conflicts stem from rent or bill payment disagreements, you'll be happy to know that you can avoid these headaches in a coliving situation.
Coliving companies offer individual lease agreements. So, although you share the space with other residents, you’re only responsible for your portion of the rent payment.
You won't have to chase down payments from your roommates. A property manager will collect your rent via a digital payment platform.
You'll still have to pay a security deposit, just a traditional apartment rental.
What's Included in the Rent?
When it comes to shared necessities such as toilet paper or cleaning supplies, there's no splitting the bill there either. They are included in your rent payment and routinely restocked.
In addition to basic household necessities, all amenities are generally included in the rent payment. A typical rent payment for a bedroom within a coliving apartment unit covers the following:
- All Utilities (water, gas, and electric)
- Cleaning Services
- Maintenance Fees
- Room and Board
- Household Essentials
Typically, the price of coliving spaces is lower than that of a comparable apartment unit with the same amenities. With a larger number of residents within a shared unit, coliving companies can pass their savings on to you through reduced rent payments.
Pros of Coliving
There are obvious advantages to a coliving setup. However, this shared living arrangement isn't for everyone.
Before making a final decision as to whether coliving is right for you, be sure to check out the benefits of it.
1. More Bang for Your Buck
Living in a big city can be expensive. Cities New York and San Francisco have been facing an affordable housing crisis for years. In short, you'd be hard-pressed to beat the affordability that coliving offers.
With large, and often, newly renovated apartment units, coliving makes for the perfect housing solution for cash-strapped renters looking for a taste of luxury. You'll be moving into a fully furnished apartment unit with an all-inclusive single rent payment.
2. Reduce Roommate Conflicts
No one s to get into roommate squabbles. Not only does it make for a tense environment, but it can blow up into a large problem that causes one of you to break the lease early.
There are tons of things to argue about in a traditional shared living set up. Those include late payments and uncleanliness.
Coliving removes those problems. You’re only responsible for paying your portion. If your roommate doesn't pay, there aren't any consequences that come down on you.
Most importantly, someone else is handling the cleaning. You can save time and avoid an argument about whose turn it is to wash the dishes. Coliving is the perfect solution for someone who wants roommates without the conflict.
3. Living With -minded Individuals
Tired of feeling lonely while living alone? Having -minded people around helps to alleviate those feelings. Coliving also serves as a sort of friend matchmaking service.
You’re generally housed with -minded residents who have similar interests and are close in age. Though this isn't a guarantee of friendship, anecdotal evidence points to coliving as the perfect recipe for friendship.
Some coliving arrangements are tailored for certain groups, artists or musicians. With a major shared common interest, there's always something to talk about and bond over.
Cons of Coliving
On the flip side of the coin, there are some significant drawbacks to this living arrangement that you should consider. Here's a breakdown of the biggest cons of coliving.
1. Limited to Major Cities
If you the idea of living with a diverse group of young, -minded professionals in a coliving setup, you must be prepared to move to a major US city. Unfortunately, as coliving is a relatively new trend, it hasn't spread outside of cities.
Though this could change later on, it's a significant drawback. If you don't mind the city life, but want a bit less urban feel, be sure to limit your search to places with outdoor spaces or that are near parks.
2. No Control Over Roommate Selection
Coliving spaces are typically designed to match residents who have similar interests together. However, there’s little control over the roommate selection process for current tenants.
While you certainly don't want to spend hours poring over potential roommate candidates, it's ly that you're also against a complete stranger moving in.
One of the biggest incentives to coliving is the idea of living with roommates who’ll eventually become your friends due to your similar lifestyles. While that's a great concept, it doesn't really account for the trouble of sharing communal spaces.
Sometimes you just want to flop down on the living room sofa and watch a Disney marathon. This might not be possible if one of your roommates wants to watch a football game or another is planning on having a few friends over.
Though you can retreat to your bedroom, sometimes sharing communal areas can be more of a hassle than a benefit.
Is Coliving for Me?
Coliving can be a great choice for someone who wants to move to a big city, save big on a luxury apartment, and keep things simple.
However, for someone who wants to live outside a major US city and doesn't the idea of sharing their space, it's not a great choice.
If you're considering coliving over traditional apartment living, you'll need to consider the following:
- Do you want to live in a major US city?
- What luxuries or amenities do you need? Which ones can you live without?
- What’s the highest monthly rent payment you can afford? (Check out our rent calculator!)
- Are you comfortable sharing communal spaces?
Ultimately, coliving can be beneficial. However, traditional apartment living can be a better fit, depending on your circumstances. If you want to live alone, then a traditional apartment rental would be preferable to a coliving setup.
Traditionally, apartment rental allows you to leave the possibility of roommates open, but you get to choose who lives with you. Additionally, you have control over the entire apartment, not just your bedroom.
Whether you decide to pursue coliving is a personal decision. However, it's essential to make an informed decision.
Don't rush. Consider all the advantages and disadvantages of both coliving and traditional renting. It's a big decision, and you should choose what works best for you!
Coliving is an emerging renting trend that looks to have some longevity to it. That's not surprising, considering the clear benefits the arrangement offers.
That said, it’s not the right choice for everyone. Before making a final decision on the matter, do your due diligence and a little soul-searching to determine whether it’s right for you.
Regardless of the decision you reach, Apartment List will be there to guide you through the apartment-hunting process.
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