How Pivot Property Management Sees the Growing Trend of Coliving

What is Coliving in Real Estate: A Guide for Investors
Posted on March 25, 2025 by Pivot Property Management

Picture this: a housing trend that combines affordability, convenience, and community into one innovative solution. Coliving has gained immense popularity in the real estate world, attracting professionals, digital nomads, and investors alike. For investors looking for high returns, coliving presents a unique and lucrative opportunity. Let’s dive into what coliving is, how it works, and why it’s reshaping the rental market landscape.

Key Takeaways

• Coliving is a modern housing trend where individuals share a living space, offering affordability, convenience, and community.
• It can be an attractive option for investors due to its potential for high returns, optimized space usage, and appeal to young professionals and digital nomads.
• There are several business models investors can explore, including owner-operator, lease arbitrage, and management models.

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How Does Coliving Work?

At Pivot Property Management, we understand coliving as a modern way of sharing a home. Tenants get their own private bedroom, often with its own bathroom, but share common areas like the kitchen, lounge, workspace, and sometimes even a rooftop or garden. It’s like living in a big house with housemates, but more organized, offering added perks.

Unlike regular rentals, coliving typically offers short-term lease options. This means tenants don’t need to commit to long contracts. The monthly rent usually includes everything: utilities, Wi-Fi, cleaning, and access to shared spaces. This makes life easier for both tenants and property owners.

With the rise of remote work and the increasing number of professionals seeking flexibility, coliving spaces have become exceptionally popular. Investors now have the opportunity to generate multiple leases from a single property, which can lead to higher returns.

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Coliving Business Models in Real Estate

When investing in coliving, you have several business models to choose from, each with its own advantages and challenges. Here’s an overview of the models we recommend:

1. Owner-Operator Model
   In this model, the investor owns the property and operates all aspects of coliving. They handle marketing, tenant management, utilities, and property maintenance. This model offers complete control and the ability to keep all the profits. However, it also requires significant capital and hands-on involvement.
2. Lease Arbitrage Model
   With lease arbitrage, an investor leases a property from the owner and transforms it into a coliving space. The investor rents out individual rooms to generate revenue. This model allows for quicker scaling at a lower cost than purchasing a property. However, it depends on securing favorable lease terms and maintaining high occupancy rates.
3. Management Model
   In the management model, an investor partners with a property owner to manage the coliving space. The investor handles tenant management and property upkeep in exchange for a share of the revenue or a fixed fee. While this model carries less risk because the investor doesn’t own the property, the rewards are also lower.

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Coliving vs. Traditional Renting: Which is Better?

When deciding between coliving and traditional renting, investors should consider target markets, location, and financial goals. Here’s a comparison of the two options:

Pros

• Higher Revenue Potential: Renting out individual rooms increases the potential for multiple income streams from one property, leading to bigger earnings.
• Increased Tenant Demand: Coliving spaces are attractive because they provide flexibility, affordability, and a balance between privacy and shared space. This makes them highly appealing in urban markets.
• Efficient Use of Space: Coliving spaces optimize every square foot of property, turning unused corners into revenue-generating areas (e.g., adding a vending machine).

Cons

• More Complex Operations: Managing shared spaces, coordinating amenities, and maintaining tenant relations can be more time-consuming than traditional renting.
• Frequent Tenant Turnover: Coliving spaces often experience high turnover, requiring more effort and cost in tenant placement. In contrast, long-term leases provide more stable, consistent income.

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Simplify Your Rental with Pivot Property Management

To summarize, coliving is a modern housing trend where individuals have their own private rooms but share common areas, allowing investors to gain multiple leases and higher cash flow from one property.

Whether you’re considering investing in coliving or sticking to traditional rentals, Pivot Property Management is here to help you make the most of your investment. We handle everything from marketing and tenant screening to property maintenance, allowing you to focus on growing your portfolio.

Contact us today to get started and learn how we can simplify your property management!