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CoLiving Offers Multifamily Investors Unique Opportunities
Published to LinkedIn on January 9, 2022
The pace of growth in the housing market is starting to slow after years of rapid increases in property values and rental rates. In some areas, values are declining, and growth is slowing nationwide.
Some investors are delaying adding to their real estate assets as we approach 2023 as a result of this trend. However, other multifamily investors are pursuing unconventional opportunities to ensure annualized returns, such as CoLiving models.
CoLiving on the Rise.
"According to iPropertyManagement, an online informational database which provides resources for landlords, the average rent price nationwide has increased 8.85 percent per year since 1980, consistently outpacing wage growth and creating financial strain for renters. To make rent more affordable, more renters are opting for CoLiving, splitting the rent with multiple roommates in larger apartments.
These renters quickly run into a few problems... around 65 percent of the nationwide apartment inventory has two bedrooms or fewer, according to a 2020 study conducted by Harvard University on rental housing. With the high cost of two-bedroom units, splitting the rent with only one other roommate may not reduce the per person rent to an affordable rate.
The second issue is that many of these apartments are designed for couples and small families. They have one primary bedroom (with an en-suite bath if you’re lucky) and then a noticeably smaller bedroom. In many cases, bathrooms are shared. This is clearly less than ideal for a roommate situation."
Now imagine upwards of four same size bedrooms with en-suite baths, and splitting the rent accordingly.
"This in-demand floor plan would bring low vacancy, year-over-year rental increases, and happy residents."
Keeping Investors in Mind
The size of CoLiving developments is also strategic. By choosing smaller buildings, a wider range of buyers is available at sale. Greater range of buyers means a greater demand, a faster sale, and a quicker payout for investors. Multifamily investing in the past was only believed to be available to sophisticated, large institutions. This niche grants ordinary investors access, too.
HomWork, launched in 2018 and is currently the largest CoWorking CoLiving community in San Diego. Take the earlier example of four same size bedrooms with en-suite bathrooms, now multiply that by three. Our CoLiVilla Golden Hills property is a 12 bed 12.5 bath in the heart of San Diego. As we speak, we are preparing to launch the largest beachside CoWorking CoLiving community in San Jose del Cabo, Mexico. So pack your bags and...
Live where you work. Work where you live. Anywhere in the world.
Learn more about HomWork and how we scale our CoLiving model, cater to our specific market, and how we exit our investments. Connect with us and we'd be happy to share with you the tremendous added value of CoWorking.
Visit www.HomWork.com/invest and connect with us to learn more about how you could get involved.
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