Housing affordability is terrible. The US population will be 340.627 million until the end of 2024, but the rate of home ownership stands at only 65.6%. Big cities are becoming enclaves for the ultra-rich, pushing the majority to the brink.

New York Times explorative it shows a sad truth we all know – house prices growth while wages stagnate. This makes Americans' dreams of affordable housing difficult to achieve. Over the past few years, prices have risen by around 60%, with a quarter of renters now spending more than half their income on rent – well above the rate of a third.

Just to make ends meet, a single New Yorker needs about $70,000 a year. The same is true for residents of LA and San Francisco; in Chicago, it's about $50,000 a year. The highest rental rates are in New York City and San Francisco, with a one-bedroom priced at around $4,280. This type of apartment is more affordable in LA and Chicago at around $2,500 per month. With median wages ranging from $5,000 to $7,500, many Americans are spending over half of their income on rent.

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The authorities are acknowledging the problem

The White House Economic Report (ERP-2024) confirms a demand-supply DISCREPANCIES and the lack of 3.8 million houses.

Factors contributing to this imbalance include restrictive land use laws, rising construction costs, and limited land availability. Despite longstanding recommendations to ease zoning restrictions and support the development of affordable housing, these measures have had little success. Additionally, short-term rentals are taking a hit in New York. The city recently began enforcing a 2022 law that bans stays of less than 30 days unless the host is staying in the home with guests. This means lost income for many owners.

While policymakers remain inert, failing to address the roots of the crisis, the market is responding with new approaches.

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Coliving as a multi-vector solution

As previously discussed, achieving a balance is difficult because solving the housing crisis requires regulatory and financial measures, new housing models and targeted support for those involved.

In response to the housing crisis, an option emerged that offered benefits to many, which it was TOGETHER.

Unlike traditional structures, co-living spaces offer a blend of convenience, a community experience, and lower prices that attract and retain tenants. The individual rooms coexist with common shared spaces such as kitchens, bathrooms and lounges.

This model is best suited for millennials looking for affordable housing for the medium term – from a few weeks to a year. They don't need to worry about household chores (repairs, cleaning, trash removal or utility bills) as the co-living operator handles these. There are always fresh remodels, high-end furniture and modern appliances. Everything works, and nothing crashes. This allows tenants to focus on what is important to them – work or studies.

ABOUT the owners, this model requires a different approach to property management. Homeowners can achieve higher profits per square foot due to increased resident density. For example, in Williamsburg, the average rent per square foot for a 4BR apartment is $5-7, while co-op rent can be as high as $9.50-10 due to increased density.

Cohabitation can also ensure a lower vacancy rate and a steady income stream. Although the higher pressure on standard enterprises requires additional expenses for maintenance and repairs, proper management makes this type of housing very profitable for owners. The co-living operator, which takes care of the services of the property and the tenants, can provide a haven for the tenants (for a relatively small fee) and a golden goose with a steady income for the owners. Homeowners are freed from the headaches caused by tenant complaints and requests from authorities.

Take, for example, a TOGETHER in the heart of Williamsburg, New York. Residents here enjoy amenities such as digital entry keys for the main door and each apartment, high-end security systems, renovated interiors, high-end furnishings, game rooms, a co-working space, laundry facilities and a cozy cafe area. Residents can host DJ events or watch the 4th of July fireworks from the rooftop.

While traditional housing models fail to address rising costs and regulatory hurdles, innovative solutions like co-living offer a ray of hope. Co-living offers a practical and affordable alternative for renters and a profitable avenue for landlords willing to adapt.

Tenants are looking for more affordable, flexible and community-oriented living arrangements. According to the data, 18–22% of renters are seeking stays longer than 30 days, with 500 million requesting such extended periods.

The real estate market is responding with increased supply. Recently, there has been an obvious one INCREASES in the construction of new housing. According to Cushman & Wakefieldthe market is not standing still as the number of bedrooms available or in development nationwide increased by 20% from 2020 to 2022.

This growth in construction and growing tenant demand indicate that the co-living model has arrived at just the right time. Co-living presents a promising and viable option for property owners exploring new opportunities. It's a model worth considering for those looking to adapt and thrive in today's real estate market.