Fractional Home Ownership & Co‑Living—A New Way to Buy?

Does buying a home seem completely out of reach? You’re not alone. Prices are high, competition is fierce, and for many younger buyers, the math just doesn’t work. But the desire to build equity and find housing that fits a modern lifestyle hasn’t gone anywhere. This is why many are turning to alternative ownership models, such as fractional home ownership and co-living arrangements.

A 2024 survey found that over 1 in 5 urban buyers under 40 considered co-living or fractional ownership before applying for a traditional mortgage. The demand is real and growing.

This shift presents new opportunities for both buyers and real estate agents. Understanding these models now could be the key to staying ahead in a rapidly evolving market.

What Is Fractional Ownership?

Fractional ownership is a popularized term for an ownership model where multiple buyers share ownership of a single property. Each person holds a legal stake in the home and gains access in proportion to their ownership percentage. Many confuse fractional ownership for a short-term stay arrangement or a vacation swap, but it’s neither of those.

Unlike a timeshare, fractional ownership gives each participant a recorded interest in the property. Because it’s equity-based, owners benefit from appreciation and potential rental income. Owners can use the home part of the year, rent it out, or hold it as a long-term investment, depending on the terms of ownership. With a real stake in the property, owners can sell, will it, or refinance their share.

Most fractional ownership setups are managed through a Limited Liability Company (LLC) or similar structured agreement. The use of an entity and operating agreement ensures clarity around scheduling, maintenance, and decision-making. How these agreements are structured depends on the platform through which the property is purchased.

Several platforms now make fractional property ownership more accessible:

• Pacaso
  Specializes in luxury vacation homes split among eight co-owners. They handle everything from scheduling to property management.
• Arrived
  Offers fractional investment opportunities in single-family rental homes. Investors earn rental income and share in appreciation.
• Kocomo
  Offers real estate co-ownership of vacation properties in international markets. Buyers get a fraction of a home for use and potential value growth, with flexible usage terms and professional management.
• Lofty
  Provides tokenized alternative real estate investments, enabling users to purchase shares in income-generating rental properties. Investors receive daily rental income, and properties are managed through a governance model.
• reAlpha
  Combines real estate investment with a short-term rental strategy. Users invest in Airbnb-style properties and earn returns through both rental income and long-term appreciation.

Fractional ownership originated in vacation markets, where high costs and part-time usage made shared investment an appealing option. Now it’s moving into cities, offering access to premium properties without the full financial burden of traditional ownership.

What Is Co-Living?

Co-living is completely different from fractional property ownership. Instead of involving property ownership, it’s a housing arrangement where individuals rent private bedrooms within a fully furnished, shared space. These homes typically include communal kitchens, living areas, and amenities like high-speed WiFi, regular cleaning, and utility management. The setup is designed for ease, flexibility, and community.

Unlike traditional rentals, co-living spaces are purpose-built or retrofitted for shared living. Residents sign flexible leases, often month-to-month, and move into units that are ready on day one. There’s no need to furnish the space, set up utilities, or coordinate with roommates. The operating company handles everything.

These living arrangements attract young professionals, remote workers, creatives, and people relocating to new cities. Many are drawn by the affordability, social environment, and simplicity of living in a managed, community-oriented space.

The following companies were leading in this space (however, they have closed):

• Common
• Ollie
• Starcity

Landing and Coliving.com are other popular co-living platforms that remain open. Landing offers flexible, furnished rentals in more than 375 cities. While not exclusively co-living, the platform appeals to remote workers seeking short-term, move-in-ready homes. Coliving.com operates as a global marketplace for local co-living options. Similar to Airbnb, it connects renters with a wide range of professionally managed co-living spaces in cities around the world.

Co-living works well for people who want flexibility without sacrificing convenience or connection. It’s especially appealing in high-cost metro areas where solo renting is often unaffordable or for those who need short-term housing.

Why These Models Are Growing—And Who They Serve

Fractional ownership and co-living are growing because they address the biggest challenges facing today’s buyers and renters: affordability, flexibility, and a lifestyle that fits. As home prices rise and urban living costs increase, these models provide practical alternatives that align with how younger generations want to live and invest.

Urban co-living in particular has surged as cities adapt to the needs of mobile professionals and creative workers. Many new developments are designed with flexible leases, shared amenities, and built-in community spaces. This trend reflects a shift toward experience-driven living, where convenience and social connection matter as much as square footage.

Millennials and Gen Z

Millennials and Gen Z buyers face significant barriers to traditional homeownership. Student debt, stagnant wages, and rising housing costs make a 20 percent down payment feel out of reach. Fractional ownership provides a way to build equity without the full financial burden, while co-living offers affordable rent and a ready-made social network. For example, in San Francisco, co-living (“tech dorms”) is experiencing a resurgence, offering $1,000/month for a compact 100 sq ft room. Both options enable younger buyers to prioritize mobility and career opportunities without relinquishing their interest in real estate entirely.

Investors

Investors see fractional ownership as a way to diversify portfolios with relatively low capital. Platforms like Arrived or Lofty create opportunities to earn rental income and appreciation without managing tenants or properties directly.

Co-living is also attractive for investors because demand for flexible, community-driven housing in urban areas continues to climb. The co-living market reached an estimated USD 7.95 billion in 2024 and is projected to grow to USD 17.05 billion by 2033, with a compound annual growth rate (CAGR) of approximately 12.9%. The model combines steady rental income with lower vacancy risks, as properties often remain in high demand.

Urban Renters and Nomads

Urban renters and digital nomads prioritize flexibility over long-term leases or ownership obligations. Co-living spaces meet that need with fully furnished units, utilities included, and locations in walkable neighborhoods. Fractional ownership appeals to those who want a foothold in expensive housing markets while keeping the freedom to move when needed. Both models support a lifestyle built around choice, adaptability, and access.

The Pros and Cons of Shared-Ownership Models

Fractional ownership and co-living create new ways to participate in real estate, whether as a resident or an investor. They can lower the cost of entry, reduce day-to-day responsibilities, and provide flexible options that fit modern lifestyles. At the same time, these models come with trade-offs that buyers and renters need to understand before committing.

The Pros

Shared-ownership models deliver several important benefits. They make real estate accessible to people who might otherwise be priced out, and they provide convenience through professional management. Co-living adds the social and community aspect that many young professionals and remote workers value.

Here are some of the pros of shared-ownership structures:

• Lower upfront costs compared to buying a full property
• Easier access for first-time buyers and younger investors
• Diversification opportunities for investors across multiple properties
• Professional management of operations, maintenance, and scheduling
• Flexibility in use, location, and lease structure
• Move-in-ready spaces with built-in amenities and community

The Cons

Along with the advantages, there are practical challenges to weigh. Fractional owners must be comfortable with shared decision-making and less flexibility in selling their shares. Co-living residents may face lifestyle conflicts when sharing spaces, and financing options remain limited across both models.

Here are some of the cons of shared-ownership models:

• Limited control over decisions and property use
• Restrictions on resale, refinancing, or transfer of ownership shares
• Ongoing management and service fees that increase long-term costs
• Difficulty securing traditional mortgage financing
• Legal and contractual complexity, requiring clear agreements
• Potential lifestyle clashes in co-living environments

Legal, Financing, and Tax Considerations

Shared-ownership models open doors for many buyers and renters, but they also come with important legal and financial details that should never be overlooked. Fractional ownership often requires unique structures and agreements, while co-living operates under lease terms that differ from standard rentals. Anyone considering these options should understand the basics and seek professional guidance before making a commitment.

Considerations for Fractional Ownership

Fractional ownership is structured differently from traditional homeownership. Most arrangements are managed through legal entities such as LLCs, and financing options are often limited. Owners also need to be aware of potential tax implications when selling their share or earning rental income.

Important factors to consider about fractional ownership include:

• Most fractional arrangements are cash-based, with limited access to traditional mortgages
• Properties are typically owned through an LLC or similar entity, which defines usage rights and responsibilities
• Mortgage interest deductions are not usually available
• Capital gains taxes may apply when selling a share
• Legal agreements should clearly cover scheduling, resale terms, and dispute resolution

Considerations for Co-Living

Co-living is generally simpler to navigate, but it still requires careful attention to lease terms and conditions. Most agreements are designed for flexibility, yet responsibilities and limits can vary widely from one operator to another.

Important factors to consider about co-living include:

• Co-living typically operates as a rental agreement, not ownership
• Leases are often flexible, sometimes month-to-month, but policies differ by provider
• Shared spaces require clear rules around use, privacy, and maintenance
• Deposits, service fees, or additional charges may apply
• Residents should review agreements carefully to understand their rights and obligations

When weighing these options, it is always best to consult a qualified real estate attorney, tax professional, or financial advisor. Expert guidance helps ensure that buyers and renters fully understand their obligations, avoid costly mistakes, and make informed decisions about their housing or investment choices.

How Agents Can Leverage These Trends

Fractional ownership and co-living are no longer fringe concepts. As more buyers, renters, and investors explore these models, real estate agents have an opportunity to position themselves as trusted guides in an emerging niche. Agents who build expertise now can serve a growing market segment while setting themselves apart from competitors.

Get Educated

The first step for agents is to fully understand how these models work. Fractional ownership differs from timeshares, and co-living operates differently from traditional rentals. Familiarity with platforms such as Pacaso, Arrived, or Coliving.com allows agents to explain options clearly to clients and address common questions with confidence.

Position Yourself as a Niche Resource

Buyers and renters are actively searching for guidance on alternative housing models, and few agents are equipped to provide it. By highlighting this expertise in online profiles and marketing materials, agents can attract younger buyers, part-time investors, and mobile professionals who are eager for solutions outside the traditional mold.

Build Partnerships

Agents can expand their reach by developing relationships with fractional ownership companies and co-living operators. Partnerships may include referral agreements, co-hosted events, or informational webinars designed to educate the public about alternative ways to participate in real estate.

Market with a Fresh Approach

Messaging should reflect the values of the audience these models serve. Flexibility, affordability, and lifestyle fit are the key selling points. Social platforms like Instagram and TikTok can be powerful tools for showcasing co-living communities or explaining how fractional ownership works. Providing transparent breakdowns of costs and benefits will also build trust with a demographic that values clarity.

The Future of Alternative Ownership Models

Fractional ownership and co‑living have matured into credible pathways to home involvement and investment. Market momentum, driven by technology and shifting values, suggests a bright future for these models. Real estate professionals, especially agents at FastExpert, can benefit by tuning into emerging demand and evolving market dynamics.

Market Growth and Emerging Trends

The market for fractional property investing platforms in 2024 reached USD 15 billion globally and is projected to expand at a staggering 16.2 percent CAGR through 2033, potentially reaching USD 26.88 billion. By tokenizing ownership and lowering entry barriers, these platforms are opening real estate investment to everyday Americans.

Co‑living, similarly, is on the rise. The global co‑living market was valued at approximately USD 7.95 billion in 2024 and is expected to top USD 17.05 billion by 2033, growing at a CAGR of around 12.9 percent. North America holds a significant share, approximately 35 percent, translating to over USD 5.25 billion in market size.

What These Trends Mean for Buyers, Renters, and Agents

Both fractional ownership and co‑living are reshaping entry points to real estate. Fractional platforms allow buyers to invest in property piecemeal and investors to diversify across multiple properties. Co‑living addresses the urgent need for affordable, flexible housing in urban centers, offering furnished spaces, utilities, and community earlier than traditional leases.

Structural Shifts Accelerating Adoption

Broader changes in technology, regulation, and product development are shaping the growth and credibility of fractional ownership and co-living models. Three key shifts are driving adoption:

• Technology and Tokenization
  Market platforms are embracing fintech innovations, including blockchain and tokenization, to enhance liquidity, transparency, and accessibility
• Regulatory Progress
  As fractional ownership and co‑living grow, legal frameworks, from contracts to tax guidelines, are becoming clearer, which reduces complexity and increases mainstream acceptance
• Product Innovation
  Platforms are expanding into new offerings, such as REIT-style fractional models or branded co‑living communities near transit hubs, making shared ownership more attractive and accessible.

Opportunity for Real Estate Professionals

Agents have an opening to build trust and establish leadership in these emerging markets. Fractional co-owners could evolve into full-home purchasers, creating repeat opportunities. Co-living residents may eventually seek long-term housing and rely on agents’ expertise. By positioning themselves now, agents can foster loyalty and lead clients steadily through a changing market landscape.

How FastExpert Agents Can Stand Out in the Shared Market

The housing market is changing fast, and clients are asking new questions. What if they only want to buy part of a property? What if they prefer a flexible living arrangement instead of a long lease? These conversations are happening now, and the agents who can answer with clarity will win trust and business.

FastExpert agents have an edge because they can showcase their expertise in fractional ownership and co-living directly on their profiles. By making this knowledge visible, agents attract buyers, renters, and investors who are actively seeking guidance. Leveraging FastExpert’s network also opens doors to collaboration and referrals in this growing niche.

By positioning themselves as early adopters, agents show they understand where the market is heading. Clients who start with fractional shares or co-living often move on to traditional ownership, creating opportunities for repeat business and long-term relationships.