What is coliving and why is it an investment opportunity?

The real estate market in Colombia is undergoing a significant transformation thanks to new trends and changes in the way we work and live. People's lifestyles are evolving, giving rise to coliving and senior living as two new housing alternatives that meet these new demands. As an industry, we face the challenge of adapting and responding to today's needs. We explain what coliving is and why it is an investment opportunity.

What is coliving? Coliving is a new form of housing in which residents share spaces and experiences in a collaborative environment. With this new concept, each person can enjoy a private room, while common areas must be shared with other residents. This new trend is an experience of collaborative living, similar to coworking, but in this case, transferred to the personal sphere.

Thanks to this model, residents can establish meaningful connections, as these spaces also seek to encourage social interaction and provide an enriching and favorable environment for fostering ideas, projects, and experiences.

What is Senior Living?

Senior Living is a concept that encompasses different housing options and lifestyles, that is, goods and services offered for longer periods to meet the consumption, lifestyle, and health needs of older adults.

According to the Economic Commission for Latin America and the Caribbean (ECLAC) in its report ‘World Population Prospects 2019’, by 2050, one in six people in the world will be over 65 (16%), which is well above the one in 11 in 2019 (9%).

On the other hand, “a study by the Inter-American Development Bank asserted that the advance of global aging has led the ‘silver economy’ to attract increasing attention from public policy makers, academia, and business. So much so that it estimated that 30% of consumption growth in Latin America and the Caribbean would come from this population” (Semana, 2023).

Why are co-living and senior living opportunities for investment? These types of projects are usually aimed at specific audiences, some are designed for executives, students, digital nomads, tourists, seniors, etc. This means that there may not be long periods of vacancy in the spaces and, therefore, occupancy rates and income are stable.

Sometimes, investors can receive higher income compared to traditional rentals, since lease agreements can be established for different periods of time. However, this can vary depending on the target audience, country, or city.

Also, these properties are usually traded efficiently, which increases their profitability. In fact, during the pandemic, coliving proved to be more resistant to market volatility.