by Karla Allen on 2017-11-15 1:23pm
The current trend in housing? Co-living, either for profit or not, could be the next big opportunity for contractors.
Since it seems like everyone is stepping up to the co-living bar, (thank you Airbnb and Uber for making it okay to hang out with total strangers in their houses and cars), let’s take a look at two of the populations of co-living inhabitants where forward-thinking contractors could discover their future niche - retiring Baby Boomers and up-and-coming Millennials.
First, what are the different structure types used for co-living purposes:
Add-ons to Existing Structures
Image credit: pixabay.com
Here we usually we mean a single family dwelling. Add-ons are more than just the ‘above-the-garage’ apartment, though. Think long-term and ADA accessible.
Both a boomerang Millennial and a Baby Boomer would be well-served by putting an ensuite on the main floor with its own entrance and no stairs.
Adding a new suite of rooms may not be an option...can the current footprint be adjusted to carve out a new ensuite? Real estate agents report that formal dining rooms are unused, start there.
Tech. While keeping the style of the house consistent, how about a tech upgrade? All ages will appreciate this. Millennials grew up with tech at their fingertips, so they expect to control the thermostat from their phone. And even if, for example, the Baby Boomer has always had a woodstove, they plan to age in place and the convenience of managing smart tech for their climate control just makes more sense.
Multi-Resident, ‘Dorm-style’, or Remodeled Single Family House
Think property management meets the dorm. This is the type of residence where there are shared common areas centrally located that include kitchen and laundry facilities, and is surrounded by individual private suites. As always, contractors have the same two choices, build new or adapt a current structure.
Here contractors can address certain issues in the construction phase, such as using building materials specially designed for noise reduction or assuring that all private rooms in a retrofit have a window.
More and more jurisdictions are allowing accessory dwelling units, or micro houses, to be added onto an existing property, or even utilizing unique building materials such as shipping containers or other reclaimed materials for construction. (However, check the code! Just because it’s trending and the client wants it doesn’t mean you should build it. Construction based upon reclaimed materials that don’t pass fire inspection, and severely poor choices, has led to more than one tragedy in the past few years.)
Are People Really Doing This?
In college Millennials used the live-work model to the degree that on days when they didn’t have class, they didn’t leave their building. Obviously not a new concept, shopkeepers have lived ‘above the store’ for hundreds of years. What is new is the design for a group of individuals who can live ‘above the store’, which also happens to include a tech studio, coffee shop, 5-star restaurant, and gym.
Image credit: uoregon.edu
Big property management startups are definitely vying for their share of rents with the business model of open, rentable workspaces, transitioning to WeLive, and smaller co-living homes like Open Door.
And on the nonprofit side? For Baby Boomers retiring from long careers, it’s all about rest and relaxation, right? Wrong. Retirees are starting businesses at unprecedented rates and need their living spaces to accommodate their new work plans. While putting in design elements that will help the Boomer age in place, such as first floor suites, leveling sunken living rooms, and securing bathroom railings, adding a home office could help them take their 25-year hobby to the entrepreneurship level.
Other reasons for non profit co-living are financial. But it’s not just Millennials who are struggling to make the rent. Many Baby Boomers who have experienced a late life change such as a spouse’s death, divorce, or even an expected event like early retirement, and still want to stay in their home are looking for others to help them stay there, even if that means renting out a room.
AARP reports on several ‘80s Golden Girls’ style housing arrangements that have been highly successful for the Boomer ladies home sharing, as well as some suggestions for agreements to have in place before everyone moves in together.
Another benefit? Both Millennials and Baby Boomers are looking for connections, for a multitude of different reasons. Millennials say that by living in big cities and working long hours, they are missing out on key social connections. Moving into a live/work environment satisfies that need for community programming. Boomers want community, too, and maybe because of those life changes, death, divorce, or retirement, are looking for new connections in their lives. By adapting housing with those needs in mind, contractors may be able to help residents find the companionship that helps them maintain a vibrant lifestyle as they age in place.
Working In This Niche
So how does a contractor make the most of the co-living market niche? Pick a population you want to work with and go find them! If the idea of contracting on co-living structures appeals, find a ‘hacker house’ in your urban area, and meet with the developer. Do they have a contractor in mind for their next project? The same goes for Baby Boomers. Baby Boomers have unique marketing needs as well and if you want to open up a niche business of ‘aging in place’ remodels, look on Facebook or in the local print media (yes, Boomers are the ones still taking the newspaper), and let them know what you can do.
Does the project cover the 7 principles of Universal Design? Incorporating those concepts into your building projects assures that they will stand the test of trends and work for all populations. Construct housing for Boomers now that Millennials will want to move into later. Don’t forget to use the Boomers in the construction field as a resource for what works, and more importantly, what doesn’t, to gain that competitive edge during bidding.
Address maintenance in the construction phase, as well. Millennials moving into co-living spaces often have everything from maintenance to maid service built into their monthly payment. At this stage in their lives, they are not interested in a lawn to mow or a roof to reshingle. And neither are Boomers. Build a rooftop community garden for Millennials and turn that half acre of grass into raised beds for Boomers.
At this point it is still hard to determine out who is ‘co-living’ from who is ‘just living’ with roommates. And while some for profit ventures receive 10,000 applications for 30 spots, some have already closed down citing an inability to actually make money at the endeavor. What the numbers do show, however, is that Millennials living with roommates is on the rise, and homeownership is at a fifty year low.
That’s good news for contractors interested in pursuing this type of work. Some urban markets are hovering at 35-45% renters, thanks to a combination of price and supply. If that describes your area, there may already be property developers looking for contractors who understand how to build co-living properties.
With home ownership out of reach now for so many, what about building homes that accommodate a post-college millennial now, provides retiree accommodations later, and - bonus - increases home values? Whether or not ‘co-living’ survives another five years, your contracting business is here to stay.
Karla Allen, the author, is a researcher and writer for At Your Pace Online, an online prelicense and continuing education provider for the construction trades as well as other professions.