CO-LIVING SPACES: AN EMERGING TREND TO GENERATE HIGHER RENTAL INCOME
Purchasing a house is, of course, a major investment, and as a result, every investor considers twice before signing a contract. Investors start by reviewing the different properties available in the market and go on to narrow the list down to their ideal investment option. Co-living is a growing trend in the Indian real estate market and one of the reasons why it is attracting investors is its rental yield.
A tenant who is a student or in the early stages of his job may not be able to afford to live in a high-rent apartment. Such persons frequently live alone in metro cities to complete their education or earn a living. The cost of renting a full apartment, as well as food and maintenance costs, maybe a significant strain in such a situation. People can easily afford the expense of living in big cities thanks to co-living spaces.
Co-living spaces as a rental option
Co-living is a type of housing that mixes individual living areas with shared public services, and it has become the new slogan among alternative asset classes. The goal of co-living is to establish a community-centered atmosphere that stimulates social interaction through community events while simultaneously providing privacy in living arrangements. It all comes down to sharing a space with like-minded individuals, where one can profit from being a part of a working community by being motivated by others. 2018 will be remembered for people spending a significant percentage of their time actively engaging in virtual socializing, among other things. Co-living, for the most part, aims to keep things real by promoting real-life activities and communication among residents, as well as encouraging them to prosper.
Property owners can benefit by transforming a regular apartment into a co-living space, according to experts, because such places are in high demand. Although there is certain to be some churn in residents, co-living spaces provide the possibility to make a pretty consistent rental income. The following aspects should be considered while designing co-living spaces:
- Tenant schedules are extremely hectic.
- Customers’ present needs are now being met.
- Additional amenities like entertainment, safety and security, laundry, and repairs, and upkeep can all be provided without breaking the bank.
According to real estate experts, young professionals and students living away from home prefer co-living spaces because the rental value decreases when the space is shared by two or more individuals. People rarely spend three to four hours in the kitchen and living room, according to a survey. As a result, co-living is a preferable option for tenants because the bedroom is just 40% of the total space. As a result, co-living is a better option for tenants because the bedroom only accounts for 40% of the entire rental cost. As a result, co-living spaces now have a better possibility of generating higher rental income.
Co-living spaces are a less expensive choice for housing because maintenance costs, electricity bills, and other expenses can be divided evenly among the tenants, and a person does not have to worry about these costs. Cities like Pune, Bengaluru, Gurugram, and Mumbai were among the first to see co-living rental homes arise but now it is spreading to smaller cities like Lucknow and Jaipur, which have substantial student and millennial populations.
Demand Dynamics in India for co-living spaces
The millennial population in India currently numbers 440 million people. This demonstrates the enormous need for acceptable housing places among the working class. The rising popularity of co-living spaces for rent in areas like Bengaluru, the National Capital Region (NCR), and Pune has prompted many investors to take notice of this burgeoning sector as a way to diversify their portfolio and risk.
The concept of co-living space renting is based on millennial behavior, in which renters share less-used amenities such as living rooms, kitchens, balconies, and other common areas to save money on rent and be a part of a working community. These establishments cater to the demands of millennials. They are technologically savvy. Co-living spaces keep up with modern technology through mobile platforms, applications, and keyless entry, to name a few. Modern technology can enable new ways of life that are more sustainable and stimulate social connection among people who live in various areas or communities.
People on a non-fixed asset model who want complete flexibility and residences that are completely furnished, serviced, and managed should consider renting co-living spaces. These are typically plug-and-play devices that relieve tenants of the pressure of dealing with daily domestic duties as well as the burden of paying frequent utility bills. In addition, the resident will find this to be quite cost-effective.
With the rise of co-working and carpooling in India, many single Indians are finding co-living to be a highly feasible alternative for living, providing a more comfortable living arrangement and a more rewarding lifestyle. They’ve discovered that living in such a place has numerous advantages. For many people, it has become their first choice when relocating to a new place.
How is co-living different from flat rentals?
The majority of multi-bedroom apartments aren’t built with roommates in mind. Many multi-bedroom apartments on the market today are 1 or 2 bedroom units that have been transformed into multiple rooms, resulting in smaller private areas and inadequately sized public spaces.
Co-living homes, on the other hand, are meant to make living with others easier and more comfortable. Some of the key characteristics of co-living include:
- All bedrooms are large enough to accommodate a full-sized bed, nightstand, and ample closet space.
- Bathrooms are shared by no more than three persons.
- The fridge has ample space for everyone’s groceries.
- The layout of kitchens is designed to allow numerous people to cook at the same time.
- There are numerous sitting alternatives in living rooms.
- It’s more affordable and flexible.
- It also provides the investors with a community-like space to reside in.
Co-living was first introduced in cities such as Pune, Bengaluru, Gurugram, and Mumbai and now it has spread its wings to tiny places such as Jaipur, where millennials are benefiting from similar accommodations. Such lodgings should be equipped with amenities such as entertainment, safety, security, and upkeep, all of which should be provided at a low cost to tenants. Furthermore, because millennials’ schedules are hectic, prepare a space based on their plans. Also, go over their fundamental needs with them and set up their room properly.
Co-living arrangements are available if you want to stay in other places for work or school. Such accommodations are designed to meet the fundamental needs of tenants and are equipped with all of the necessary amenities as well as a unique method to experience freedom. These types of lodgings are cost-effective and provide a great opportunity to express yourself. Before moving into a co-living place, make sure to check online and gather all of the necessary information. Assetmonk is an online platform offering co-living services in India. Our ambitious Co-Living Venture ‘The Landing‘ is all set to launch in the Hyderabad International Airport. To grab your chance and start investing, visit our website today.
Co-living Spaces: An emerging trend for rental investors FAQ's:
Coliving is a type of modern housing in which people share a living space as well as a set of shared interests, values, and/or objectives. It’s a fresh twist on an old concept, conceived by a generation that values openness and collaboration, as well as social networking and the sharing economy.
Co-living has the potential to provide a rental return that is more than double that of a standard investment property. Get up to three different rental revenues from your tenants, increasing your rental income! A larger number of occupants paying rent means more rental agreements for a single property.
For starters, even when the real estate market is fluctuating, investors can get rental income. Second, a co-living place is easier to locate a tenant for than a traditional residential property. Finally, in the co-living residential area, property maintenance is better.