Co-Living Is A Potential $93-Bn Market, Says Report
As cities mature and employment opportunities grow, getting a house at an affordable price becomes tougher. This makes the need to optimise space important. One of the biggest examples of optimisation is co-working spaces, a hit among small companies and startups that need limited space at a small investment.
Now, a similar trend has picked up in the residential housing sector as well -- co-living.
According to PropTiger.com’s latest findings, co-living is a potential $93-billion market with a current supply of only one lakh beds. Estimates suggest that on an average, suppliers charge Rs 12,000 per month per bed, taking the overall sales to Rs 1,440 crore.
At PropTiger.com, data scientists studied that about 40 per cent of all those who were looking for a rented property, searched for a co-living space such as paying guest accommodations. College students and single working professionals were the highest demand creators in this category.
Let's simplify. about 12.30 million college students in India are migrant population and there are 50,000 colleges. Those living within campus premises/college hostels account for only 3.4 million. The remainder add to potential co-living space hunters while an even bigger number of single working professionals at about 37.4 million.
All of these put together could be the demand creators.
What the industry feels
Experts across the industry see this deficit as a major loss. Niranjan Hiranandani, MD, Hiranandani Constructions recently addressed the media pointing out how untapped the rental market is while developed nations such as the United States boasts a balanced market with about 50 per cent people opting for rented homes. If the Centre’s Housing For All mission needs to fruition, rental markets cannot be left untapped.
Slowly, but steadily big and small players have identified this gap and are getting in the race. We reached out to one such co-living space provider to get an overall picture. Ashok Jangid, Sales and Marketing Manager at CoHo says that for most working professionals or even students, regular rented accommodations are no more than mere crash pads with minimal interaction among the dwellers. Contrary to the traditional idea of homes on rent, CoHo encourages community living too.
What makes it stand out?
Jangid says, “These properties are fully-furnished and serviced -- there is a dedicated housekeeping, an in-house chef, brand new furniture, air conditioners, upholstered beds, even side tables and the stay is perfectly managed through an app. You could raise a ticket to get help in case any of the functions are down.”
“There is a lavish lounge area. Besides, we organise events, tournaments and activities, screen movies and facilitate a lot of networking so that after-office hours aren't dull, “ he adds.
Adding to this, John Jacob, general manager at CoHo says, “Unlike a PG or a hostel where one is catered with just the real estate, CoHo aims to make it a social experience too.”
As per your preference and budget, you could choose between villas, apartments or dorms. There are CoHo dorms for students and prices vary depending on the amenities provided. More and more players are disrupting the rental market with creative concepts to suit every segment.
Safety and security
How safe are these? If you are worried about the safety, Jangid assures, “There is a stringent Know-Your-Customer (KYC) procedure that we follow to assure that co-habitants are from not from disputed backgrounds.
“We make sure we conduct a thorough background check. ID proofs are verified. There aren't any unisex accommodations which would make co-habitants uncomfortable and as per one's liking, they can go in for single, double or triple sharing accommodations. The idea is to make these service and community oriented,” adds Jacob.
How much will you need to spend?
If you thought that the rents are going to burn a hole in your pocket, it is not the case. It broadly varies between Rs 10,000-25,000 per month depending upon the number of people you are sharing it with.
Some other companies operating in this field are WudStay, Ziffy Homes and Fella Homes. The concept is popular even in the United States and China. Bahrain-based MNC Al Namal Group is also foraying into co-living segment through an agreement with Bengaluru based co-living brand, Square Plums. These too boast ready to move homes and target the young, on-the-move populace.
Startups in this space
StayAbode was founded in 2016 and the company builds co-living spaces. Its founders Viral Chhajer, Varun Bhalla and Devashish Dalmiya say, "Co-living is like living in a boutique hotel with a community of like-minded individuals. Through this way of living, StayAbode uses real-estate efficiently giving property owners up to 100 per cent higher yield on their properties."
Tatsuya Hase, GM, Investment Division at Voyage Group, says, "We picked StayAbode, as our first investment in the Indian market as we believe co-living is the future of millennial living in India and we believe StayAbode is well placed to create great value in it and we are excited about the future of the company.”