As a landlord, you have options when it comes to renting out your property. You could list your home as a single unit and take on a single tenant, or you could opt to rent out your home by the room and take on multiple tenants simultaneously. The latter option is worth considering in today's market. The reason? Co-living is poised to make a comeback, and if you market your property accordingly, you can really capitalize on it.
It's all about company and affordability
There are a couple of factors that could lead to a surge in co-living demand in the near term. For one thing, many people have been living in isolation for the better part of a year thanks to the coronavirus pandemic. Those who have been cooped up by themselves may be eager to live with roommates -- even if those roommates start out as strangers -- once the idea of doing so becomes safe.
Secondly, though many people have abandoned large cities in the wake of the pandemic, the demand for city rentals could soar once the pandemic ends and companies could start calling workers back to the office. At that point, many renters may find themselves priced out of the cities they want to call home. Co-living can, in some cases, make for a far more affordable arrangement. And even when shared spaces aren't cheaper, they do tend to offer more amenities and square footage than the typical renter can afford solo.
Of course, co-living can take on different forms. In some cases, it could mean renting a home with multiple bedrooms and sharing it with roommates. In other cases, it could mean joining a co-living community.
WeWork, for example, which is known for its shared office space, has opened several New York locations under its WeLive brand. Those apartments range from studios to four-bedroom units and generally cost less than comparable buildings in the area.
Meanwhile, Haven, a co-living community, has several California locations with more in the works. Haven's model focuses on short-term rental contracts with shared common areas and desirable amenities like housekeeping and streaming subscriptions. In some cases, the perks are so tremendous that residents actually pay a premium for a co-living setup rather than save money.
But despite the range of models, at its core, co-living allows renters to maintain some privacy in their own bedrooms while sharing common spaces and enjoying the company of others. At times, that will also translate into savings on rent, and when it doesn't, there will generally be amenities to reap instead.
Should you get in on the co-living boom?
Investing in co-living spaces is worth considering right now, especially in light of where we're at in terms of the pandemic. If things improve on that front within the year, the demand for co-living space could truly soar in 2022, so getting in now could be the ticket to serious revenue.
Renting an existing home on a room-by-room basis is another way to jump on the co-living trend. And from an income perspective, going that route could help you boost your rental revenue, as you may get away with charging more on a per-room basis than on a per-house basis.
Co-living arrangements tend to be more transient in nature, whereas renting your home as a single unit could lead to better income stability. But if you're willing to take a (reasonable) gamble on co-living, it could end up proving quite profitable.