As the rental market continues to evolve, co-living spaces are becoming an appealing choice for renters priced out of traditional rental housing. Co-living spaces are especially attractive to tenants seeking affordability, flexibility, and a built-in network. From students and young professionals to city dwellers and remote workers, renters are turning to shared living arrangements that deliver both convenience and savings.
Even so, co-living arrangements bring opportunities and challenges for rental property owners and managers. Below, we’ll review the expansion of co-living spaces, the most important factors for rental property owners and managers, and key practices for successfully marketing them.
Understanding the Rise of Co-Living Spaces
Co-living is a real estate term tied to the rise of housing startups that create homes designed to be shared by five or more adult roommates. These co-living spaces take diverse forms, including single-family homes renovated for non-related residents and high-rise buildings redesigned into dormitory-style lodging. More broadly, co-living may describe anything from master-planned communities to the practice of living with roommates.
Numerous factors explain the increase in popularity of co-living spaces. For instance, higher rents in larger cities have compelled renters to share space with non-related adult roommates. At the same time, remote work culture and evolving modes of social connection have driven renters to seek out community in creative ways. As such, co-living strongly appeals to professionals, students, city dwellers, and remote workers.
Key Considerations for Property Managers
Rental property owners and managers planning to transition into the co-living market will confront both opportunities and risks. Some of the key factors to consider include:
- Lease Structures & Flexibility: There are pros and cons to renting a single unit or property to multiple tenants. On one hand, individual leases can offer renters more flexibility while helping rental property managers maintain stable rental income and lower turnover costs. On the other hand, the requirement to manage individual leases and lease renewals for multiple occupants can create a heavier property manager’s workload. Offering group leases, by contrast, can reduce lease management though they may lead to other drawbacks.
- Furnishings & Shared Amenities: Another key consideration is how to design a co-living space for community living. Although setups differ, residents of co-living properties generally want communal spaces that encourage connections. Property managers can draw co-living renters by creating communal indoor and outdoor spaces. Offering furnishings, style elements, and shared amenities ensures residents are comfortable and guarantees fairness in communal spaces.
- Tenant Screening & House Rules: Another topic with co-living rental properties is ensuring compatibility among co-living tenants. Because residents of a co-living property are non-related adults, they typically want roommates whose lifestyles and personalities suit their own. This creates challenges for rental property managers as it requires balancing duties and standards in communal spaces. By establishing a clear set of house rules, managers can define expectations for conduct among non-related residents.
- Legal & Zoning Regulations: Another detail is local laws regarding shared housing. In some areas, there are strict regulations about the number of roommates and/or residents in certain housing types, so confirming these requirements is essential before offering a co-living rental.
How to Successfully Market Co-Living Rentals
Marketing co-living units involves specific unique elements of marketing a co-living rental property. To succeed, draw attention to the characteristics that attract renters to co-living spaces, such as benefits like cost savings, increased community engagement, and desirable settings.
Renters looking for co-living spaces tend to be most attracted to properties offering easy access to urban centers and rich local arts and entertainment options. They usually explore social media platforms and rental listing sites to locate and apply for rental homes. By implementing digital promotions and highlighting key features in your marketing, it becomes easier to attract the type of renters searching for co-living rental homes.
Is Co-Living the Future of Rental Housing?
There are significant reasons to explore co-living rentals as an innovative and profitable option for your properties. On the other hand, co-living may not be the most suitable option for every rental property or district. This is why understanding all the benefits and challenges of managing co-living spaces is a necessary first step.
If you’re interested in managing or investing in co-living spaces, please reach out to your local Real Property Management Raleigh office. We are available to give you the tools needed to make smart real estate decisions in Rolesville and beyond. Our consultants can provide assistance with evaluating market trends, shaping investment plans, and addressing operational requirements. Reach out to us or call 919-481-0008 to find out more!
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