The latest data and analysis from Built Asset Management has revealed that there has been a huge 312% increase during July and August in renters ditching single accommodation in favour of co-living, when compared to pre-lockdown.
The data relates to new rental contracts taken out within co-living properties across the capital between 1st July – 31st August 2020.
According to the findings, the increase in renters coming from single-let properties, ie. those inhabited independently, signing rental contracts for a room within a co-living property operated by BAM, when compared to the months of January and February.
These months were given as a comparative as they were pre-lockdown measures imposed on the rental market, therefore giving an accurate snapshot of the pre-Covid 19 co-living market.
BAM asks all prospective tenants seeking co-living accommodation anecdotally for their reasons for leaving their current housing situation. According to those leaving single-let accommodation between July-August, the top three reasons given were as follows:
Seeking a more financially viable accommodation option – 32%
Seeking co-living property to avoid a feeling of isolation – 25%
Seeking flexibility with a view to potentially purchasing afterwards – 20%
Furthermore, the data revealed the average age of tenants ditching single-let accommodation in favour of co-living to be 36.1 years old; 8 years older than BAM’s average age of tenant of 28.2 years old.
Alex Gibbs, Co-Founder and Director of BAM, explained the data:
“Typically, the bulk of our incoming occupants are young professionals either moving from existing houseshare accommodation in the city or entering London’s rental market for the first time. Post-lockdown, however, we have seen a real “Covid-effect” coming into play with a huge increase in renters vacating single-let accommodation in favour of co-living, a trend which shows no signs of slowing down throughout September.
“Undoubtedly, changes in personal and work circumstance as a direct result of Covid-19 have led to many renters seeking a more financially-viable route in the form of shared accommodation; ultimately a more affordable option than single-lets. What’s perhaps more interesting, though, is that a relatively high proportion of our new tenants have directly cited trepidation about the feeling of isolation as their main reason for exiting the single-let market.
"The negative impact of lockdown on mental health appears to have had a direct effect on rental behaviour. It is also interesting to note that one in five new tenants have cited increased flexibility as a key reason for selecting this type of accommodation, with a medium-term plan to purchase a property rather than to continue renting.
"We will want more data in order to make stronger inferences here, however, initial signs suggest that the lockdown and the wider pandemic have caused Londoners to re-evaluate their priorities and potentially their attitudes towards renting in the long term.”