As more people search for convenient and community-based housing options, co-living has become an increasingly popular choice. By definition, co-living is a housing concept that combines private living spaces with communal areas and shared amenities. Essentially, it is a way to live with roommates without the hassle of finding them yourself.
Co-living spaces can range from small apartments with few shared rooms to large buildings with hundreds of residents. Hundreds of people come to Dubai looking for excellent job opportunities. For starters, co-living space is easier to find, light on the budget, and fosters a sense of community for those who are alone in the city.
Co-Living Spaces Worldwide
Johnny Wolf, founder of Homeroom – a startup for co-living space across the US, believes that this trend is here to stay. The percentage of young people between the ages of twenty-two and thirty-five has increased dramatically. 11% of people in that age group live with roommates. So as the population grows and the percentage rises, the demand for coliving spaces will increase.
According to his experience, when he moved to Kansas, there were many people who wanted to live in a shared space. With the rise of rents and property prices, living by yourself in a property can cost your salary. Therefore, people don’t mind living with other people in today’s day and age.
As per his research, the co-living market space in the US alone is around a twenty-five to seventy-five billion dollar market. Internationally, it’s half a trillion dollars and a good market opportunity for investors.
What Are Tenants Looking For?
Co-living certainly raises a lot of questions as to what tenants are looking for when they opt for shared spaces. Are they comfortable living with absolute strangers? How much of their privacy are they willing to give up? Wolf shares that before tenants move in, they meet up with their future roommates and decide if they want to.
Many such co-living start-ups do a thorough screening of the potential tenants. For instance, they check for their past credit history, criminal records, eviction notices, and other background checks. So anything a new tenant worries about is ruled out in the initial meetings.
Why Are Co-Living Spaces Gaining Popularity Among Tenants?
With thousands of people migrating to this city yearly for work and a better lifestyle, there is a steady demand for affordable housing. However, Dubai is the city of the rich and affluent. Those starting from scratch may not be able to afford a villa in The Ranches or a townhouse in the Creek. Those with families may struggle to find a safe neighborhood with all the modern amenities.
This is where co-living spaces come as a rescue. They are easy to find through various apps like Hive and reduce your lion’s share of rental expenses. Furthermore, people can enjoy living in the exclusive neighborhoods of Marina, Palm Jumeirah, and Beach Residence without digging a hole in their pockets.
Benefits of Co-Living for People
Co-living is becoming increasingly popular for several reasons. Firstly, it is an affordable option for people wanting to live in expensive cities like Dubai. But they can neither afford to buy nor rent a traditional apartment. Secondly, co-living spaces often offer more amenities than conventional apartments, such as gyms, co-working spaces, swimming pools, and rooftop gardens.
Moreover, co-living provides a built-in community for people who might be new to the city and looking to make new friends. For the future of real estate, we can expect to see more co-living spaces pop up across the globe. Some experts predict that co-living can even replace traditional apartment living altogether.
Benefits of Co-Living for Investors
As the demand for co-living grows, there will be more investment in building and renovating spaces specially designed for co-living. It is a new and exciting trend in real estate that’s gaining momentum around the world. With its combination of affordability, convenience, and community, more and more young people are choosing to live in such spaces.
For real estate investors looking for higher rental yields, investing in a co-living property is a profitable investment. It offers a minimum of two percent increase than what they are earning from traditional rent. Secondly, they can maximize their space utilization and reduce the problem of the rental crisis.
Furthermore, it increases borrowing capacity as the rental income increases from existing property. It will help in building your real estate portfolio. Additionally, investors can bridge the gap between demand and supply. As more and more young professionals are moving to Dubai and looking for co-living spaces so they can fulfill that demand.
Co-Living Spaces Driving Occupancy Rates
According to CNA, co-living spaces drive occupancy rates by a whopping 95% as more people seek temporary housing. After the Dubai government opened the real estate market post-pandemic, expats returned. This means that prices that were already high in the rental market soared.
Many people said that co-living makes sense to them as some seek temporary affordable housing while others enjoy a social living. In Dubai’s pricey market, which is already short on supply, comes the high rental prices by landlords capitalizing on it. Analysts say co-living operators have been able to offer more competitive rates as they have a policy on room rates for their company.
Landlords are finding it more lucrative to rent directly to the open market as they enjoy the high rental return. On the other hand, co-living operators are seeing consistent growth in their business, with more young people opting to live in such spaces.
The Rise of Co-Living in Dubai Real Estate Market
If you are moving to Dubai and are worried about the high rental price, then co-living will be a great way to save money. Furthermore, if you are an investor looking to invest in properties and provide co-living spaces, then you can check out Top Luxury Property. They have all kinds of properties listed on their website, which you can take a look at sitting in the comfort of your home. Additionally, they have off-plan projects with convenient payment options in The Ranches, Dubai Marina, and downtown.