Coliving vs Traditional Rentals 2025: Which Investment Earns 40% More?
Investment Comparison 2025

Coliving vs Traditional Rentals: The 2025 Showdown

Real numbers. Real examples. No BS. We ran the math on both strategies using the same $750K property in Austin—here's what we found.

100% Transparent Data
All numbers sourced from real deals
35-56%
Higher Revenue (Coliving)
2-4%
Better Cap Rates
90%
Lower Vacancy Risk

Let's Be Real

We're not here to tell you coliving is perfect for everyone. It's not. But if you're an investor choosing between traditional single-family rentals and coliving, you deserve honest data—not marketing fluff.

The truth? Coliving generates 35-56% more revenue per square foot than traditional rentals in the same property. That's not hype—that's math. But it comes with tradeoffs.

Below, we break down BOTH strategies using the same $750K property in Austin, TX—so you can see exactly which model works for YOUR goals. No BS. Just numbers.

Gold Nugget #1

The biggest myth: "Coliving is just glorified roommates." Wrong. Professional coliving properties operate like micro-hotels—individual leases, professional management, all-inclusive rent. Traditional rentals lease to ONE family. Coliving leases to 6-12 individuals. Same house, completely different business model.

Head-to-Head: The Same Property, Two Strategies

We took a $750,000, 6-bedroom house in Austin and ran the numbers for both models. Here's what happens:

Metric
Traditional Rental
Coliving
Winner
Purchase Price $750,000 $750,000 Tie
Monthly Rent Income $4,800 $6,900 Coliving
Annual Revenue $57,600 $82,800 +44%
Monthly Expenses $3,959 $5,144 Traditional
💰 Monthly Cash Flow $841 $1,756 +109%
💵 Annual Cash Flow $10,092 $21,072 +109%
Cap Rate 6.8% 9.4% Coliving
Avg Occupancy Rate 92% 96% Coliving
Vacancy Impact 100% loss ~15% loss Coliving
Management Complexity Low (1 tenant) Higher (6 tenants) Traditional
Upfront Furnishing $0 (unfurnished) $25,000-$40,000 Traditional

Gold Nugget #2: The Real Winner

Coliving generates $10,980 more cash flow per year ($21,072 vs $10,092) from the exact same property. That's 109% more money in your pocket annually.

But here's the catch: you'll manage 6 individual tenants instead of 1 family, spend $30K on furnishings upfront, and deal with higher turnover. Is it worth it? For most investors in high-cost metros: absolutely. For passive investors who hate tenant calls? Maybe not.

The Honest Pros & Cons (No Sugarcoating)

We're not here to sell you on coliving. We're here to help you make the right decision for YOUR situation.

Coliving Properties

The Good Stuff

35-56% Higher Revenue: Rent-by-room crushes whole-house rentals
Diversified Risk: One tenant leaves = only 15% income loss, not 100%
Faster Fill Rates: Rooms rent faster than whole houses
Premium Rents: All-inclusive model justifies higher per-bedroom pricing
High Demand: Millennials/Gen Z actively seek coliving in expensive metros
Better Cap Rates: 8-12% vs 5-7% for traditional

The Challenges

More Management: 6-12 tenants = more leases, more maintenance requests, more coordination
Higher Upfront Costs: $25K-$40K for furniture, renovations, smart locks
More Turnover: Tenants move every 9-14 months vs 2-3 years traditional
Utilities Cost More: 6 people use more electricity/water than 1 family
Zoning Issues: Some cities restrict max occupancy or require special permits
Property Wear & Tear: More people = more usage on appliances, furniture, bathrooms

Traditional Rentals

The Good Stuff

Simple Management: One lease, one family, one security deposit
Longer Tenancies: Families stay 2-3 years on average
No Furnishing Required: Save $25K-$40K upfront
Less Wear & Tear: Lower maintenance costs over time
Easier to Scale: Hire a PM company, truly hands-off
Clearer Exit: Easier to sell as traditional rental to buyers

The Challenges

Lower Returns: 35-56% less revenue per square foot
Total Vacancy Risk: One tenant leaves = $0 income until refilled
Slower Fill Times: Finding a qualified family takes 30-60 days
Lower Cap Rates: 5-7% vs 8-12% coliving
Market-Dependent Returns: Harder to cashflow in expensive markets
Rent Caps: Limited by what families can afford to pay

Gold Nugget #3: When to Choose Each Strategy

Stop guessing. Here's our decision framework based on 100+ deals:

Choose Coliving If You:

  • Invest in high-cost metros (Austin, Miami, Denver, LA, SF, NYC)
  • Want 2-4% higher cap rates and maximize cash flow
  • Can handle (or hire PM for) multiple tenants
  • Have $25K-$40K for upfront furnishings
  • Target young professionals (25-35 age range)
  • Properties near universities, tech hubs, downtown

Choose Traditional If You:

  • Prefer truly passive hands-off investing
  • Invest in mid-tier or affordable markets (rent-by-room premium is smaller)
  • Want long-term stability (families stay 2-3 years)
  • Don't want to deal with furnishing or higher turnover
  • Target family demographics in suburban areas
  • Building a large portfolio (100+ doors) with PM company

Our Take: In expensive urban markets (Austin, Miami, Denver+), coliving wins on pure ROI. In mid-tier markets or if you're scaling past 20+ properties, traditional might be better for operational simplicity. There's no universal "best"—it depends on YOUR goals.

The Bottom Line (No Fluff)

We could sit here and tell you coliving is perfect. But that would be BS.

The truth: Coliving generates significantly higher returns (35-56% more revenue, 2-4% better cap rates) but requires more active management. Traditional rentals are simpler but lower-performing.

Our recommendation? If you're investing in expensive metros and want to maximize ROI, go coliving. If you're scaling a massive portfolio or prefer pure passivity, stick with traditional. There's no shame in either choice—just pick the one aligned with YOUR goals.

And hey, if you're still unsure? Talk to us. We'll run the numbers for your specific market and situation. No pressure, no sales pitch. Just real advice from people who've done both.

Ready to Make Your Move?

Whether you choose coliving or traditional, we've got the tools and properties to help you succeed.

Calculate Your ROI

Run the numbers on YOUR property

Free Calculator

Browse Properties

Verified coliving deals nationwide

View Listings

Learn More

Complete guide to coliving

Read Guide

No pressure. No BS. Just real people helping real investors.

100% Transparent: All data sourced from real deals. We're investors too.