As the rental market continues to evolve, co-living spaces become a more attractive option for renters priced out of traditional rental housing. Co-living spaces lure tenants seeking affordability, adaptability, and a built-in sense of community. Renters range from young professionals and students to remote workers and city dwellers, and many are enticed to shared living arrangements because they are accessible and cost-effective.
Yet, co-living arrangements provide opportunities and challenges for rental property owners and managers. Let’s take an in-depth look at the growth of co-living spaces, some critical concerns for rental property owners and managers, and practices for successfully marketing these one-of-a-kind properties.
Understanding the Rise of Co-Living Spaces
Co-living is a real estate term that has led to the rise of housing startups offering homes designed to be shared by five or more adult roommates. These co-living spaces take numerous types, from single-family homes renovated to accommodate non-related residents to floors in high-rise buildings converted into dormitory-style lodging and so forth. Generally, co-living can relate to anything from master-planned communities to simply living with roommates.
A variety of factors contribute to the increase in popularity of co-living spaces. For example, higher rent prices, primarily in larger cities, have compelled several renters to share space with non-related adult roommates. Cultural transformations have also had an influence, as remote work culture and advances in social networking have urged more renters to seek out community in new ways. For these factors, co-living is particularly attractive to young professionals, students, city dwellers, and remote workers.
Key Considerations for Property Managers
Rental property owners and managers wishing to join the co-living market will face both opportunities and problems. A couple 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 the other hand, people leases can offer renters more flexibility while giving rental property managers more steadiness in rental income and lower turnover costs. The other side of that advantage is the requirement to manage individual leases and lease renewals for several people, which can significantly increase a property manager’s workload. The alternative is to offer group leases, which can reduce lease management but have other potential disadvantages.
- Furnishings & Shared Amenities: Another critical matter is how to design a co-living space for community living. Although arrangements differ, in most situations, residents of co-living properties expect to have communal spaces that encourage meetings. Property managers can lure co-living renters by establishing communal indoor and outdoor spaces. Providing fixtures, decor, and shared amenities can guarantee that residents are comfortable and that nobody has control over communal spaces.
- Tenant Screening & House Rules: Another factor of co-living rental properties is guaranteeing compatibility among co-living tenants. As non-related adults, residents of a co-living property may prefer to share their home with individuals who have lifestyles and personalities well-matched with their own. This can be problematic for rental property managers because it necessitates managing expectations and responsibilities connected to communal spaces. Having a clear set of house rules can assist in outlining these responsibilities and set expectations for conduct among non-related residents.
- Legal & Zoning Regulations: Another thing to think about is local laws regarding shared housing. Some towns impose strict regulations about the number of roommates and/or residents in different housing types, so it is imperative to do your research before presenting a co-living rental.
How to Successfully Market Co-Living Rentals
There are some unique elements of marketing a co-living rental property, so it is imperative to mention the attributes that attract renters to co-living spaces to start with. For illustration, in your advertising, make sure to point out benefits like cost savings (specifically when compared to regular rental properties), community engagement, and location.
Renters looking for co-living spaces are generally attracted to properties with easy access to urban centers and local arts and entertainment options. They also mainly employ social media and rental listing sites to locate and apply for rental homes. By using online promotion techniques and highlighting key features in your marketing, you can more easily attract the type of renters who are searching for co-living rental homes.
Is Co-Living the Future of Rental Housing?
There are several reasons to explore co-living rentals as a unique and money-making option for your properties. Yet, co-living may not be appropriate for all rental properties or locations. This is why a full understanding of all the benefits and challenges of managing co-living spaces is an imperative initial step.
If you’re interested in managing or investing in co-living spaces, please speak to your local Real Property Management Capital City office. We are eager to help you make informed real estate decisions in Austin and adjoining areas. Our staff can deliver insight into market trends, investment strategies, and operational management. Reach out to us or call 512-572-6799 to get more details!
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