Can startups solve the urban housing shortage with co-living?

Planning a move to a new city; the first issue for many is not where to rent but what you can get. Urban migration is hampered by the inability of many cities to invest in adequate housing supply to meet the number of inhabitants. Or lax local laws mean higher-yielding Airbnbs stifle the residential rental market.

That makes the house hunt a competitive sport and a major source of stress. But now there is an alternative that is getting better and better and demonstrates a new way to solve the problem. This is called co-living.

What is co-living?

Traditionally aimed at digital nomads on working holidays, today’s co-living is very different and is designed to solve housing shortages faced by many people in cities like Berlin, London, Paris, Oslo, Copenhagen and Madrid. .

And if you balk at the idea of ​​shared housing, cohousing isn’t just student housing for adults. There are different configurations – what you choose depends on your budget and the desired balance between personal space and common space – but the general idea is that you rent a furnished room and share a common kitchen, meals and living space. work with others.

Depending on provider, location and budget, amenities range from wifi, utilities, communal lounges and upper end cleaning, e-bikes and shared e-vehicles, cinemas, bars, gyms and libraries on site.

Coliving with Habyt in Frankfurt

Founders solve pervasive pain points

I spoke to Ritu Jain, co-founder of the coliving society LifeX. The business started by default organically following a move to Copenhagen from San Francisco. She and her companion ended up renting a huge apartment in the city center too big for a couple.

The property became home with six bedrooms and large common areas. Seats were filled by word of mouth before they even opened the doors.

The company now has 100 homes in Aarhus, Berlin, Copenhagen, Halle, London, Munich and Paris.

Berlin: a case study on housing inaccessibility

Take Berlin as an example, where 80% of people rent. If you’re moving to Berlin for work, you can’t just sleep on someone’s couch. You must register your address (owner or tenant) with the local authorities – this is called Anmeldung and is required to open a bank account, obtain your tax identification number and obtain an employment contract. And getting that rental to be able to sign up is a challenge without the employment contract, tax ID, or bank account.

find an apartment game
The rental hunt gamified

stories of racism by the owners are banal. And it’s notoriously competitive – one game developer even did Berlin Dish Questa game where you can try your luck against the rental market.

LifeX Community Life
Community Life at LifeX

Co-living not only provides homes that can provide amenities, but people can move into them without needing to build a kitchen (yes, really) or buy furniture. It also gives you friends and the experience of being part of a community – necessary given that many people are already isolated in new cities as a result of COVID and remote working is the new norm.

Additionally, co-living is space-efficient, putting more homes in the pool by residents sharing the space.

Luca Bovone is the founder and CEO of a cohousing startup Habitwhich started in Berlin in 2017. He explained that part of their task is to transform inefficient buildings built in the 1940s and 1950s into much more efficient spaces.


In addition to palatial furniture, today’s co-living spaces are increasingly serviced by smart technologies such as smart lights, locks, and energy monitors. LifeX has created its own technology platform that works end-to-end, from initial application to billing, maintenance requests and management, and a subset where residents can host events. Jain explains:

“I can sit in our office and at any time see what is happening in our cities, in homes, in terms of service levels, the happiness of our tenants and take action. The real estate industry does not never had this before. They don’t make decisions based on data.”

The Habyt platform allows the automatic publication of lists of available units on several platforms simultaneously for long-term accommodation. Bovone shared that this allowed for over 95% occupancy throughout the year.

And since both companies are focused on building new housing, the technology can be integrated from the start.

The challenge of disrupting a traditional industry

Both Jain and Bovone noted that gaining traction with traditionally conservative real estate agents was initially difficult. Jain said, “It hasn’t all been easy. Even though our top spot had been empty for two years, the estate agents initially balked at the idea.”

But fortunately things have changed. According to Bovone, today, “almost all developers in Europe have some sort of allowance for shared rental accommodation”.

The company works on a range of different projects and also partners with some property companies which are “forced to look at sustainability and how the future of living is going to be”.

By comparison, gaining traction with investors was much simpler. Jain explained that early investors knew the housing challenge after investing in startups whose new employees needed help finding housing. “They see what’s happening in society very early on because of the nature of the companies they invest in. And so I think they saw that trend very early on.”

LifeX raised a total of $19.9M in funding more than Three Sleeves.

Habit raised $35.4M in funding over six rounds. The company also completed seven acquisitions, including Quarters by Erasmus Room, Goliving and, more recently, Common life.

Have a place to live vs hell is other people

Not all cities agree with the idea. In Ireland co-living is a controversial issue for government officials and the inhabitants. New constructions of cohabitations have been banned since 2020 for fear of not meeting the needs of those looking for long term rentals. Is this a smear campaign by real estate lobbyists, or should we be looking at the question of the private space we need to live?

Habyt coliving
Coliving in Barcelona with Habyt

Co-living residents aren’t just 20-year-olds in their first job. Residents of LifeX and Habyt are mostly in their thirties. Originally a model of living for shorter periods, Jain and Bovone agreed that people are now staying longer in coliving, given the dearth of relatively high-priced local alternatives.

And with estate agents on board, will co-living become not just the new normal but, in the future, the only option?

In the long term, is a “start-up” lessor better than a “corporate lessor”?

Habyt currently has 30,000 homes worldwide. Bovone wants to reach 100,000 units and possibly one million, “which is equivalent to the number of units held by Marriott hotels”.

Although ambitious, Habyt’s numbers are modest in a city like Berlin, where a 2021 (non-committal) audience referendum was passed to transform 240,000 homes owned by private providers like Deutsche Wohnen SE, owner of over 100,000 homes in the city, into socialized housing managed by the city as a public entity.

Jain and Bovone talked about the diversification of housing configurations, including private apartments and layouts of different sizes. They agreed that there is a need for adequate housing for single parents, for example.

And beyond the stereotype of tech evangelists, LifeX residents already include a diverse mix of healthcare and hospitality workers. Bovone is also planning cheaper housing for lower-paid workers, such as those in food services and the older resident market, in the future.

Bovone also talked about the potential for future rent-to-own programs and is also considering the idea of ​​”working with governments to use our skills and what we’ve learned to build community-oriented, technology and more energy efficient”. .”

It’s a lot more forward-thinking than your average landlord.

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