Co-Living To Grow 2X Over The Next Two Years

Sincerely Media/Unsplash

Whenever you see the terms metro city and affordable housing together on Ginger Chai, the news can't be good. You see, decent housing in our top cities is not affordable. 

However, co-living offers a miraculous housing solution to those on a budget, by letting multiple people conveniently share a living space, and thus split the living cost. 

Even Miracles Face Headwinds

The concept of ‘shared economy’ got severely tested during the first lockdown. With job losses and a total closure of education campuses, demand for co-living sank like a stone. 

Then, between December 2020 and March 2021, co-living occupancy crossed the 45 – 50% mark as the market improved, going on to touch 60-70% occupancy in Q1, 2021. 

However, the second wave battered the economy and from Q2, 2021 onwards, occupancy dipped sharply again.

But, But, But...

The shared economy is back in demand - riding steady on the high vaccination rate and an overall economic revival - and is expected to have 4,50,000 beds by 2024, a number that stands at 2,10,000 beds today, per a Colliers report. 

With the unemployment rate down to 7% in November 2021, a gradual dip from 11.84% in May 2021, robust hiring by IT, Healthcare and Edutech companies, and re-opening of college campuses, the young are thronging back to the metros and many are opting for the convenience of co-living. 

Higher Demand And Returns Wooing Players

The growth in co-living will be pushed by two major forces at play. 

📌 One, increasing migration to cities is creating a steady uptick in demand for co-living, a trend that is expected to continue in the long term, and...

📌 Two, co-living is offering attractive returns; 2-4 times higher than the traditional residential yield of 2-3%, translating into a compelling opportunity for investors.