The millennial mindset has spurred a number of transformational developments for society. Social media platforms like WhatsApp, car sharing services like Uber, holiday home sharing like Airb&b, and co-working spaces like WeWork are just a few manifestations of their out-of-the-box disruptive thinking. In the real estate domain, coliving is quickly becoming the new buzzword. This idea of urban living has been gaining traction with millennials across the globe.
Getting smart about space sharing
Especially in the US and Europe, coliving or “community living” is a new take on the old idea. What’s new is that individuals are now being drawn together by lifestyle choices, and not so much by religious affiliations or other considerations. The idea is to get smart about space sharing.
A millennial typically spends about 45 minutes a day in the living room and kitchen, and around nine hours in the bedroom. Yet, the living room and kitchen space account for 60% of the real estate price, while the bedroom accounts for 40% of the cost. Coliving spaces optimise real estate utilisation. By sharing less utilised areas with a larger community, residents easily save around 10% of the expense, and property owners get a higher yield on the property on account of being able to accommodate more people on a floor plate.
For years, the “hacker house” has offered aspiring entrepreneurs a place to rest their heads — often a bunk bed — for cheap rent. In 2004, Mark Zuckerberg rented a five-bedroom house in Palo Alto, where early Facebook employees built the social network. But now the hacker-house concept has evolved into all-inclusive experiences that come with lots of perks. Residents, or “members,” as they’re often called, can join these communities and instantly tap into amenities such as free internet, maid service, and new friends.
Unlike previous generations, young professionals today are not strung out about possessions. Your phone serves as your computer, TV, camera, photo storage, music player, book reader, and even credit card wallet, so having a physical space for your landline, TV, stereo, and etc. is an obsolete idea. What they value are experiences, being part of like-minded communities, and flexibility. And coliving delivers that.
Here are four key reasons why millennials are switching to coliving as a lifestyle choice, and why it’s considered the future of residential real estate for the urban living millennial.
Value for Money
Many people nowadays are struggling to afford a house in major urban centres. It’s not simply the rent that is an obstacle. Large deposit expectations, inflexible commercial contracts, and absent landlords of traditional buy-to-let models are also serious challenges.
In coliving spaces, people pay an all-inclusive rental package, covering all utilities, housekeeping, and maintenance, making shared living a very cost effective, convenient, and flexible solution.
Ease of Urban Living
For urban professionals who typically move jobs (and homes) every 20 months or so, having to deal with furnishing, kitchen appliances, and utility contracts when relocating can be a real hassle.
Coliving is based on the plug-and-play model. Everything is provided — it’s like urban living in a classy hotel. Technology is applied to increase service efficiency, saving you the hassle of dealing with everyday household chores, and letting you focus on what’s more important in life.
Sense of Community
While most youngsters tend to be hungry for the freedom to explore new horizons and possibilities, the journey can often get lonely. Studies suggest that more than 40% of millennials suffer from chronic loneliness. That’s why they cherish being part of like-minded communities.
Coliving offers the perfect antidote. Living in a community of like-minded individuals — bonding over breakfast and gaming evenings — makes it easier to have meaningful face-to-face conversations in an increasingly virtual world. Not surprisingly, community living is a trend on the up.
Among rental options, coliving spaces are surely the safer and more convenient choice for newcomers to the city. The community element ensures easy access to a host of inside knowledge about the location which otherwise could take months to grasp. They also tend to be more organised and transparent when it comes to security.
For instance, in our coliving Hive spaces, keys are a thing of the past. Residents are provided with electronic access cards, fobs, and can even open doors using their phones. Background verification and screening process of the staff, residents, and contractors are also common practices.
Coliving is not a fad — it’s already becoming a sustainable category in the real state sector. Depending on the amenities and the kind of community you are looking for, there are quite a few options available today.
Startups like us — B-Hive Living in the UK, Cohabs in Belgium, Open Door in the US, and others are experimenting with design, technology, and service to build coliving spaces that appeal to the generation that is always on the move.
The rise of coliving does not necessarily mean the death of traditional home rental and ownership. But it only takes quick research to realise why the future of coliving looks bright — the market and social trends provide a strong basis for its exponential growth.
Predictions state that in another five years we can expect home ownership to drop by 40% in the UK. Only 10% of homeowners are aged 16–34 — this represents a jaw dropping 50% decrease since 1998 according to a study by the Resolution Foundation. The most recent English Housing Survey shows, millennials between the ages of 25 and 34 are more likely to practice urban living by renting in the private sector than to buy with a mortgage. What’s more interesting, over the last 10 years. the number of those aged 25–34 living in privately rented households nearly doubled from 24% to 46%. The private rental sector is growing in the UK like never before. Housing can’t be built fast enough.
With property prices rising and the growing influx of millennial renters in the market, things transform rapidly. Academics such as Alexandra Notay, policy director at the Urban Land Institute, argue that structural and lifestyle changes in society such as flexible employment are boosting long-term demand for rental homes. The self-employed, start-up workers, and flexi hour employees are all examples of a new segment of the population who do not want to be tied down by a mortgage, and prefer the flexibility that comes with renting.
Technology has changed the way the world appears and functions. Coliving is set to change the way millenials and other segments of modern society approach housing and urban living in the future.
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