The Origin of Co-Living Asset Class:
As majority of the companies around the country are now adopting hybrid working models, India’s millennial work-force is forced to find affordable housing near their companies.
It looks like millennials are caught up in the troublesome task of finding an affordable and comfortable home in major cities.
To solve this affordable housing problem, real estate industry experts started the co-living real estate concept. This in turn has allowed a lot of Indians to adopt the Co-Living model, which has drastically increased the demand for co-living spaces in housing locations, especially near employment centers and commercial districts.
What are Co-Living Spaces?
Co-Living spaces are typically located nearby major workplaces and tech parks . You also get to enjoy the company of like minded professionals and share your personal space with your family.
The co-living concept encourages a culture of people with shared interests, employment backgrounds, and similar hobbies to live together as a community and share resources.
Co-living spaces have evolved as a residential housing type in various regions of the country, especially favored by millennials and Gen-Z populations, implying that co-living spaces are a cost-effective, reliable, and innovative home investment.
In simple terms, they symbolize the shared economy.
Co-living spaces are larger and more spacious, with a real kitchen, living room, balcony, and other amenities, and they are less expensive than studio flats, which are small and only suitable for one person.
For investors:
By partnering with co-living operators, property owners can fetch better rental returns without the hassles of managing tenants on their own or through brokers.
The demand for co-living spaces are only increasing across the country. It is not just any investment but also a socially responsible investment as you are investing for the purpose of providing affordable housing for the working professionals of India.
Investing in these asset class also means that the co-living players bring in processes and industry standards hence assuring you of regular rents and deposits,safety, property upkeep and demand for your property
There are several benefits of co-living for renters, such as flexible lease tenures, well-managed living spaces, and value-for-money rentals.
There is also the build-sell-operate strategy, in which a developer partners with an operator to transform his unsold inventory into a co-living space and then sells the property with the co-living space label to an interested investor with an excellent rental guarantee.
We see a lot of promise for this model in the co-living space because there is a lot of unsold inventory in all metros, and millennials are searching for budget-friendly shared spaces that are built to their liking. This strategy also opens up a big possibility for investors who have shied away from real estate owing to financial constraints, as it provides an accessible investment choice.
Co-living spaces have arisen as a bankable real estate structure, particularly in large Indian cities. As sales figures rise, it has become one of the hottest trends, providing a huge boost to rental housing in the country.
Important Features of Co-Living Spaces:
- Shared Ecosystem
- Brings Work closer to People
- Flexible Renting Options
- Access to High-end Amenities
- Cost-Sharing for Common Daily Activities
- Interactive Events and Socializing Activities for the Tenants
Investment Point of View:
Making profit from unsold property:
The accumulation of unsold inventory is one of the most important issues plaguing the real estate business. Despite the fact that many properties are vacant in India’s major cities, there is a scarcity of cheap flats in Tier 1 and Tier 2 cities.
Unsold apartments are easily converted into shared or family rental spaces, which are often established by co-living organisations that lease the entire building. Approximately 72% of millennials are interested in renting co-living spaces, according to a recent survey conducted by a top portal.
Encouraging active developer participation:
The recent trend of co-living enabled large cities to tap into previously untapped real estate opportunities. The vast majority of co-living service providers work in tandem with developers who have property that can be utilised as rental housing. The property of the developers is managed by the co-living service providers. The partnership proves effective because the rental money helps both parties.
Taking a sensible stake early in a trend is a huge advantage for any investor.
Co-living is here to stay and has the potential to be the next big thing after coworking spaces.
In India, investment opportunities in co-living are now somewhat limited. Investors might profit from this blooming concept by assessing the potential for co-living in the future. People are willing to try new things as technology disrupts numerous sectors, and hence the demand for Co-living assets is very significant.
While investing in the early stages, investors must remember to conduct a thorough research of their investment and the project’s cash flow estimations.
Interested in Co-Living Investments starting at just Rs.10 Lakhs?
we have partnered with industry leaders for providing retail investors access to institutional-grade Co-Living Properties.
To get started visit our co-living projects page and learn about the current opportunities in India:
