Co-Living Trend Gets Interest and Money from Investors
Investors are showing a growing appetite for co-living start-ups, though multifamily sector experts doubt the co-living trend will disrupt the housing sector.
Hundreds of millions of dollars have been invested in co-living start-ups in the last 18 months, according to Jeffrey Pang, CEO of Homeshare, a co-living marketplace. In major U.S. cities, where housing costs are high, such as San Francisco, millennials would have to spend 77 percent of their income on rent to afford the average one-bedroom, according to MarketWatch. And those rising housing costs are not changing soon, at least in major U.S. cities.
Since early 2010, apartment rent growth has far outgrown income growth, according to data from RealPageInc., a provider of property management software and services. In 2017, apartment completions in the 150 largest U.S. cities jumped to 395,775 units. Upscale buildings accounted for 75 to 80 percent of that new supply, according to RealPage. In that same span, nearly 30,000 new apartments were built in the New York area. Roughly 85 percent of them were luxury units.