Co-Living â Reshaping Rental Housing in India
In the past few years, we have seen the real estate industry get rid of its stereotyped principles (residential and commercial) and seek opportunities for cohabitation, student housing and elderly living. These alternative investments are becoming more and more important in India as an attractive investment and a new way of life.
This new starting point in the real estate industry has attracted a number of local and international private investors, institutional investors and other mutual funds. Real estate investors are slowly shifting from the residential property category to alternative properties. Through higher rental returns and higher return on investment compared with residential projects.
Despite the economic downturn and stagnant work, the growth and prosperity of the student apartment and shared apartment market is enough to attract investor’s attention.
It is run by nomadic students and millennials who are redefining work and life. In metropolitan areas with higher education and work, they prefer to live in a good society with modern apartments, rather than the traditional leasing model. Higher savings, curious homeowners, big brokers, unnecessary regulations and fluctuating rents are the main factors that motivate students and millennials to commit to this new co-living model.
Market size and opportunities According to the 2017–18 Indian University survey, nearly 59% of the total number of students have been accepted in five states including Telangana, Maharashtra, Karnataka, Tamil Nadu and West Bengal college education. According to the University Grants Committee (UGC) data, as of December 2018, there are 892 universities in India, affiliated to nearly 50,000 colleges and research institutes.
There are approximately 34 million students in higher education, and the demand for student dormitories has not been met. In major cities across the country, the number of students has increased from 32.3 million in 2013–14 to 36.64 million in 2017–2018, an increase of 13.3%, but there are only a little more than 6 emergency shelters, 5 million bed.
The rental housing market in India is worth US$20 billion, of which US$13.5 billion is in urban areas. The size of the student dormitory and shared apartment market is expected to triple in the next 10 years. Approximately 95% of the rental housing market is chaotic, dominated by paying guests (PG) from local owners and brokers, hotels and apartment rentals. At present, the demand for student dormitories is about 8 million beds, which is expected to reach 13 million.
The number of beds by 2025. Shared apartments and student dormitories are still in their infancy, and the youth community market is gradually modernizing. Modern shared apartments can generate 10–13% of rental income. The increasing number of millennials, rapidly changing consumer trends, and untapped potential demand are attracting investors. “Ownership” and this trend are aimed at increasing the demand for coexistence. Global shared life awareness According to Jones Lang LaSalle, the popularity of coexistence and university dormitories is being welcomed and welcomed by millennials around the world, and the urban coexistence market in India is expected to occupy a dominant position in the Asia-Pacific region.
Three Indian cities, Mumbai, New Delhi and Bangalore, have noticed their global influence in the entertainment industry. Mumbai finished fifth, followed by New Delhi (11th) and Bangalore (19th). Due to the huge untapped potential of the domestic market, several start-up companies have conducted investment rounds in the past two years. The continued decline in residential real estate, coexistence and student dormitories has become a major attraction for investors and developers. In India, co-living and student housing are expected to attract US$700 million in investment and add 6,000 beds. In 2019, US private equity giant Warburg Pincus and India’s Lemon Tree Hotels formed a coliving joint venture worth 430 million US dollars. In October 2018, OYO decided to enter Co-Living. Some large investment companies such as SoftBank, Sequoia Capital, Warburg Pincus, Jingwei Venture Capital, Accel Partners and Goldman Sachs have established themselves in investing in the industry, Indian startups are not lagging behind to get a big cake. Some operators are Nestaway, CoHo
