Living, Differently

The Future of Co-Living in Australia 7 Living, Differently 6 Co-Living Demand WHY DOES DEMAND FOR CO-LIVING EXIST? Australia’s private rental market remains under acute pressure, with rental availability well below average and vacancy rates near historic lows. Cotality recorded rental growth of 5.5% across Australia in the year to September 2026, while its June affordability data showed rental households dedicating around 34% of pre-tax income to rent - the highest share on record. All the while, rental demand continues to increase, particularly from single person households. A myriad of factors such as greater education and employment choices, worsening house purchase affordability and increasingly global lifestyles have combined to result in people delaying major life events, remaining single for longer (or indefinitely) and renting for longer. The number of non- family households, which include share- house residents and singles, grew 35% in the 15 years between 2006 and 2021, about one third faster than family households which grew 27% over the same period. Between 3.4 and 4.0 million Australians are projected to be living alone by 2046 – a 50% increase on 2021 levels. (Source: ABS) BUDGET CHANGES COULD REINFORCE CO-LIVING DEMAND The May 2026 Federal Budget changes could add further pressure to Australia’s rental market by making the tax environment less favourable for some small-scale landlords. Over time, this may reduce investment in established rental stock, particularly in lower-yielding suburbs and high- value markets such as Sydney, where holding costs are already elevated. The extent of any impact will depend on how investors respond and the rate of new housing delivery. If traditional rental supply tightens, the need for professionally managed, purpose-built alternatives could become more acute. Additional Co-Living supply could absorb demand from mobile single renters, students and recent arrivals, while easing competition for larger homes better suited to families. Between 3.4 and 4.0 million Australians are projected to be living alone by 2046 International student numbers have risen 12% since 2019, while graduate visas have more than doubled. By June 2026, 2.8 million people held temporary visas, including students, working holiday makers and skilled migrants. The Labor government is seeking to reduce net overseas migration to 225,000 by 2027–28 through measures including curbs on “visa hopping” and a ballot for second and third year Working Holiday Maker visas. Tighter migration settings therefore present a downside risk to demand from some of Co-Living’s most mobile renter groups. However, exposure to international arrivals is partly mitigated by demand from domestic renters: almost half of tenants at UKO, Australia’s largest Co-Living operator, are Australian, demonstrating the sector’s broader appeal to renters seeking flexibility, convenience and community. Against this backdrop, Co-Living meets the growing need for renters who are priced out of self-contained apartments, struggling to secure quality share house accommodation, or seeking well-located housing without taking on the full cost and commitment of a traditional lease. Singles and sharers are driving household growth, supporting demand for Co-Living 0 500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 Number of visas granted New Zealand Student Bridging Visitor Temporary Graduate Temporary Resident (Skilled Employment) Working Holiday Maker Other Temporary Visa Holders in Australia One family household Non-family household (singles and sharers) Total households 0% 5% 10% 15% 20% 25% 30% 35% 40% Percentage change between 2006 and 2021 27% 35% 29% Source: ABS Census, 2021