While developments both in the co-living sector and the private rented sector (PRS) are purpose-built for the UK rental market and aim to provide high-quality accommodation with a high-level of finish, co-living developments are specifically designed to cultivate community within their buildings with a heavy focus on wellbeing, community, and creating spaces with purpose for residents to use as an extension of their own home – encouraging interaction between residents and the operators who run the buildings.
To compare the benefits of co-living and PRS developments, we have outlined three ways that co-living is different to PRS.
Throughout the many decades of its operation, the private rented sector has maintained a similar residential offering and, during this time, failed to fully evolve with the demands of the UK rental market. Instead, PRS buildings have continued to offer larger apartments with two and three-bedrooms and high rental prices that reflect the square footage of the property, to a market that is searching for single occupancy, compact homes with access to an on-site community that can provide a well-rounded long-term living experience.
To satisfy their demand for single occupancy, compact homes, young people are gravitating towards co-living developments that are specifically designed to provide studio and one-bedroom apartments with an emphasis on community-focused living within the building. While many have the misconception that the co-living sector provides glorified houses of multiple occupancy (HMO), co-living developments in fact provide self-contained, single-occupancy apartments with their own private kitchens, bathrooms, and living spaces, while also offering access to on-site amenities and an established community to become a part of. As a result, co-living developments take a tenant-centric approach to residential development and consider the resident’s experience throughout the design and operation of the building, offering a living experience that is centred around wellbeing and community.
Despite most PRS developments having on-site amenities for residents to use, these spaces are not managed effectively – often sitting vacant and unused until a resident within the building makes the conscious decision to enter the communal areas themselves – and in this instance, residents will usually use the facilities alone or alongside few other residents and not interact with them whilst in these communal spaces.
Co-living developments are specifically designed to provide managed, multi-purpose spaces that on-site Community Managers actively encourage to be used by the residents both during scheduled events and after, with spaces such as bookable dining rooms, shared cantinas, rooftop terraces, and media rooms becoming a part of the living experience for residents. By employing a dedicated Community Manager whose sole purpose is to encourage engagement and community amongst the residents, organise a regular calendar of events within the communal spaces, and bring residents into the amenity spaces to actively use as an extension of their own home, co-living developments break down the distinction between private dwelling and amenity space that PRS developments establish.
While PRS buildings are often seen as a residential market open to all, operators within the private rented sector are well-known for refusing student applications for housing in favour of young professionals and family residents, which excludes a market of an estimated 2.75 million students currently studying in the UK.
The co-living sector is designed to accommodate those aged between 18 – 30-years-old, providing a residential offering that can house a student throughout their studies, onto their first professional position, and later as they develop in their career. By widening its market audience to encompass these key demographics, the co-living sector provides a residential offering that welcomes the majority of those looking to rent in the UK market. This allows investors to host a tenant in their investment for up to 12-years – providing a secure return on investment and limits the possibility of investors losing revenue each year when a student moves on, or after a family has outgrown their apartment dwelling.
With the number of lifestyle renters on the rise and more people searching for a living experience that provides a nurtured on-site community for residents to become a part of and benefit socially from, the demand for co-living properties is growing exponentially, as the demand for a community-centric living experience that extends further than a few token facilities and communal areas continues to increase in the UK.
To learn more about the benefits of investing in the co-living sector, get in touch with one of our expert property consultants today.