It’s no secret that most young professionals today prefer a 24/7 live/work/play environment. More than ever, talent is clustering in dense, urban areas. However, as jobs and people have moved back into cities in droves, urban housing has become too expensive for the average worker.
As rental rates and housing prices in urban areas has skyrocketed, innovative real estate developers have stepped in to create more affordable living environments. We have micro-units, co-living, macro-living, temp living, and several technology platforms that support the new urban lifestyle. Let’s dig in to the many futures of urban living.
The idea of micro-units is simple; by designing smaller, hyper-efficient units (typically ~300 SF) developers can achieve a higher $/PSF while also renting the units at a lower nominal monthly rent than a typical studio or 1-bedroom. Millennial renters, who typically value experiences over possessions, are willing to sacrifice space for the lower rent (at least for a little while). Carmel Place was the first micro-unit development in NYC. The developers partnered with Ollie, a service that offers housecleaning, wi-fi, and curated community events.
Co-living is another trend in urban living. It’s a housing model that stems back to the residence hotels of the early 20th century and is simply roommates and common rooms, like college dorm-style living. The model plays off several themes; affordability, the sharing economy, a yearning for connection, and an increasingly freelance workforce.
There are several popular co-living models including Common, Ironstate’s Urby brand, Starcity, and WeWork’s Welive brand (there’s even co-living consultants). While each model is slightly different, the concept is similar; we’re only as good as the people we surround ourselves with.
Macro-living is a new term coined by oWow and refers to a style of living designed specifically for families and roommates to live together. Instead of developing micro-units or creating co-living spaces with shared common areas, oWow develops 860 SF three- or four-bedroom units with a full dining room, kitchen, and two bathrooms.
These units are designed specifically for families and roommates and are 30% to 50% more efficient in the use of space. oWow also offers a roommate matching app and, for now, is focused more on affordability as opposed to creating a sense of community like the co-living model.
The shift toward a freelance workforce has also led to increased mobility, however housing models remain stagnant; 30-year mortgages or 12-month leases which anchor individuals to one location. Roam is a network of co-living spaces that allows you to sign a lease that enables you to continually move around. These aren’t vacation rentals, but rather a different way to think about ‘home’ for location-independent people who work remotely. The model combines co-living with continuous travel. Residents have their own private bedroom and bathroom, but also have access to shared common areas including a co-working space. Although residents can book by the week or month, residents typically stay longer. The service isn’t designed just for freelancers, it’s also for empty-nesters and young couples who want to travel the world for a few years.
Technology Platforms for Urban Living
Each of these housing models is improved or made possible by technology. Ollie curates the experience in micro-units or co-living spaces and Roam enables you to connect with co-living and co-working spaces all over the world on a single lease. Other services such as Alfred provide additional services for today’s urban professional such as cleaning, grocery shopping, dry cleaning pickup, and package shipping. Other services such as Bedvetter (not yet launched) will help match you with roommates.
When I moved to NYC in 2009, I did what many new resident do; paired up with 2 friends and converted a 2-bedrook in Murray Hill into a 3-bedroom. After a few years, I was ready for something different and leased a smaller 1-bedroom with my girlfriend (now wife). Cramming 3 people into a 2-bedroom and later 2 people into a 1-bedroom is a common way of making urban living more affordable. Neither situation was ideal from a living perspective as spaces were poorly designed, lacked storage space, and offered little in a sense of community.
New housing models such as micro-units, co-living, macro-living, and various technology platforms have created affordable solutions for today’s urban professional. Although each model approaches the challenge differently, they help provide affordable living solutions, while building a great sense of community, and aligning with today’s lifestyle trends.
As I’ve gotten older (I’m 32 now), I’ve begun to think about what my next living situation will look like. Although I still have the desire to live in a walkable area, having a family and raising kids in a small apartment isn’t ideal. Despite the flexibility of renting, the countless options available, and the poor return on housing as an investment, I have a desire to buy. My wife and I want a place to make my own for our family. It’ll be a place that we design, raise kids, and make our own memories.
However, we don’t want the mcmasions of our parents’ generation in far-flung suburbs. Rather, we want an efficient space that is accessible to the city and offers walkability to an infill area within a great community.
This shift in demand is noticeable in most suburbs which have been re-imagined and now include mixed-use development, thoughtful public space, transit options, and community-focused development.
There have been many innovations in urban living, I wonder which will stick and what other models we’ll see pop up?