Insights Into Housing and Community Development Policy

Insights

Into Housing and Community

Development Policy

U.S. Department of Housing and Urban Development | Ofce of Policy Development and Research

Assessments of Shared Housing in the United States

Shared housing, generally defined as a living arrangement in which two or more unrelated people share a house or apartment, is

an affordable living arrangement in the United States, particularly in urban areas with high housing costs. Shared housing ranges

from home sharing, where a homeowner rents out a room in the owner-occupied property to a person seeking affordable housing,

to co-living, where an individual rents a private room in a single-family or multifamily building but shares common areas with other

tenants. Shared housing can take different forms, and many U.S. and international shared housing organizations and companies

facilitate shared housing arrangements or build formal shared housing developments.

Shared housing arrangements can vary from short-term, transient housing to long-term, permanent housing. The range of possible

setup options means that shared housing can benefit many people, including those new to a city; those in search of affordable housing

who may not qualify for or receive housing assistance; transient workers in need of housing while working on a contract; senior

homeowners looking for long-term assistance to age in place; individuals wanting to live communally in an “intentional community”;

families living in multigenerational arrangements; or homeowners simply wanting to reduce their housing cost burden. Indeed, the

different shared housing models can offer flexibility for individuals not ready to commit to long-term housing solutions or for those

wanting to save money for other housing options.

Shared housing can provide greater flexibility for a housing stock to meet current market demands by housing more people in

a housing unit. High demand for housing in urban areas reduces the availability of affordable housing, increasing the price for

housing and the housing-cost burden of residents in those areas. Housing affordability may be further reduced by restrictive building

regulations and zoning codes in these areas, among other factors. In response to increasing housing costs, many people share housing

to reduce their housing-cost burdens. Individuals living in shared housing weigh a variety of tradeoffs when deciding whether to share

housing—including their willingness to pay—with preferences over privacy, communality, types of space, amounts of living space,

and location, among other hedonic influences. Some individuals, facing economic constraints, choose to share housing because of the

relatively lower housing cost compared with living alone, and yet others prefer to share housing regardless of price factors.

The paper finds that there are many different types of formal and informal shared housing arrangements, and that they can offer

a range of benefits to residents, including reduced social isolation. They allow for flexibility in a housing stock and can allow

individuals to live in more opportunity-laden locations, especially in times or areas where housing supply is more constrained. Two

of the more common types of shared housing are home sharing and co-living; home sharing is a way for homeowners to reduce their

housing costs and provide an affordable housing option to others. Formal co-living models, reinforced through the design of housing

built specifically for co-living, are a rapidly growing sector of real estate markets, because they present a convenient way for young

professionals to move to and live in a new city, often in communities nearby to desirable urban amenities and places of employment.

Many cities and states in the United States and other countries are embracing shared housing models, through regulatory reform of the

built environment to allow these arrangements and pilot initiatives of shared housing designed for particular populations, including

low-income tenants, formerly homeless individuals, and other underserved households. Across different measures, there has been

a small increase between 2000 and 2019 in the prevalence of households who share housing. Depending on the expansiveness of

the definition for shared housing, the current rate of shared housing is somewhere between 3 and 20 percent of all housing units.

Moreover, there are a substantial number of homes which might be called “undercrowded”, with 26 percent of homes having two or

more bedrooms per person in the household. This suggests a potential capacity for greater shared housing.

Insights into Housing and Community Development Policy

U.S. Department of Housing and Urban Development | Ofﬁce of Policy Development and Research

This paper offers an overview of shared housing in the United States from both a theoretical and a practical standpoint. Overall, it

addresses what shared housing is, examines which households live in shared housing arrangements and why, and discusses the various

shared housing models available in the United States—including organizations that either directly provide or facilitate (often matching

prospective tenants to providers) shared housing options. Section 2 gives a brief history of shared housing in the United States; details

some of the economic, social, and health-related factors that play a role in the behavior of individuals who choose to share housing;

and analyzes indicators showing the prevalence of shared housing in the United States. Section 3 describes the models and challenges

of home sharing and co-living in the United States in more detail and draws on qualitative interviews that U.S. Department of Housing

and Urban Development (HUD) staff have conducted with leading home sharing and co-living firms. Section 4 provides examples

of federal and state initiatives in shared housing, including allowances for shared housing as an alternative living arrangement that

assisted residents can use in HUD’s Housing Choice Voucher (HCV) program and specific international research partnerships around

shared housing between HUD and foreign governments.

Same Housing Unit Same Building

Flat Share Unrelated roommates, often from the same

generation and without children, living

in the same house or apartment unit.

Typically with individual bedrooms but

sharing common spaces, including kitchens

and baths

Co-Living Individual renting of private and often

furnished rooms, typically in multifamily

buildings, with shared common spaces in

individual units and in buildings. Frequently

targeting adult professionals in high-demand

housing markets

Multigenera-

tional

Household

Related or unrelated household with two or

more adult generations

Single-Room

Occupancy

(SRO) housing

Affordable housing designed for low-

income tenants renting small and sometimes

furnished single rooms, with shared kitchens

and baths in the building

Home

Sharing

Renting out of homes by resident

homeowners in exchange for services,

typically senior homeowners looking for

support to age in place

Co-Housing Private, individually amenitized, self-

contained units or homes clustered

around shared space to form intentional

communities, which can be organized

formally as a homeowner’s association or

housing cooperative

Group Home Private home for individuals needing social

assistance, such as drug rehabilitation,

often with an on-site resident manager

Figure 1. A Typology of Shared Housing

Why Do People Share Housing?

Shared housing is a unique housing

design and living arrangement that

residents pursue formally or informally

for a variety of reasons. In the United

States, single-room occupancy (SRO)

housing exemplifies a visible form

of shared housing that rose with

industrialization and urbanization and

declined with the suburbanization

of American housing. In today’s era

of “reurbanization” of American

cities—as seen from an upward trend

in population growth starting in some

cities in the 1980s

—both renters

and homeowners live in many

other types of shared housing

arrangements and are motivated to

do so generally by some combination

of economic, social, and health-

related factors. Some of these factors

are detailed below.

Although SROs

remain an important

form of shared

housing for certain

housing users, shared

housing has expanded

to cover many other

types of housing.

History of Shared Housing

Shared housing has been a common

housing arrangement throughout U.S.

history. Early co-living concepts can be

traced back to the early 19th century

in the form of single-room occupancy

buildings and boarding houses in large

urban areas.

These shared housing

models offered affordable housing

for people who came to urban areas

to work. As metropolitan economies

grew, however, overcrowding led to the

perception and proliferation of unsafe

conditions in boarding houses in many

urban areas, and as safety regulations,

building codes, and occupancy limits

became commonplace, these housing

arrangements either became tightly

regulated or were largely outlawed by

states and localities. SROs began to

wane in the 1920s, and single-family

homeownership became increasingly

prevalent after World War II with the

cheap production of housing, increasing

incomes, the development of American

suburbs, and the promotion of the nuclear

family

as a social norm.

Many SROs were

demolished or converted into other uses,

like offices or hotels. Research has paired

the reduction in SROs, which was often

politically motivated,

with increases in

homelessness and the use of motels and

hotels as informal housing for low-income

renters with limited social capital.

Technological advancements in the

construction industry

(especially

Generally defined as a couple and their dependent children, which is regarded as a basic social unit.

around fireproofing

and ventilation

regulatory reform,

and advancements

in public health

mean that it is now

possible to build dense housing with

lowered minimum unit sizes without

creating unsafe and unsanitary habitation.

Although SROs remain an important

form of shared housing for certain

housing users, shared housing has

expanded to cover many other types

of housing. Some of the most common

types are detailed in Figure 1 and can be

differentiated based on whether residents

are sharing the same housing unit or the

same building. Many shared housing

arrangements, such as home sharing

and co-living, are becoming increasingly

common, as can be seen through the

establishment and growth of these

models in the formal real estate sector.

Many shared housing

arrangements,

such as home

sharing and co-

living, are becoming

increasingly

common, as can be

seen through the

establishment and

growth of these

models in the formal

real estate sector.

Economic Factors for

Shared Housing

Shared housing enables people to live

more affordably by reducing their

housing costs; shared housing most

often occurs in metropolitan areas

with high housing costs. Of course,

shared housing is not for everyone:

people have different preferences in

their housing arrangements based on

many factors, like proximity to work;

family needs; and preferences around

amenities, individual space, and privacy.

Hedonic pricing studies of shared

housing in the form of Airbnb rentals

(attempting to measure the contribution

of various internal and external factors

to the housing price) found that, across

cities, individuals were willing to pay

an additional premium for rentals that

were listed as an “entire home” or “entire

apartment” as compared to a private

room or shared room, holding other

factors constant.

This finding shows

that the norm may be for people to

willingly pay more for privacy; however,

these preferences may be limited by

a person’s income, wealth, and how

much they can afford to spend on

housing costs. As a person ages, these

preferences can change as well. Many

people who can afford the option of

living alone prefer the privacy and

autonomy that living alone provides.

The financial situation of many people

living in high-cost areas, however, may

not enable them to live alone in preferred

locations near their jobs or other desired

amenities, such as public transportation,

safety, entertainment, and other amenities

associated with well-served urban areas.

Shared housing provides a way to reduce

housing costs while still living in a more

preferred area. Indeed, shared housing

represents a tradeoff in preferences

between privacy and the opportunity

to live in a higher-quality home or

neighborhood than an individual or

family could afford on their own. A survey

of welfare-assisted families in unassisted

private housing in the state of Virginia,

for example, found that living in shared

housing, as opposed to living alone, was

associated with reduced rent burden and

better physical housing quality.

Figure 1. A Typology of Shared Housing

Insights into Housing and Community Development Policy

U.S. Department of Housing and Urban Development | Ofﬁce of Policy Development and Research

Shared housing

represents a tradeoff

in preferences

between privacy

and the opportunity

to live in a higher-

quality home or

neighborhood than

an individual or

family could afford

on their own.

Reasons for “doubling up” or sharing

housing vary individually but come

down to some tradeoff between social

and economic factors.

Economic

factors include housing costs, income,

expenditures, other expenses, and a

person’s ability to pay for a housing unit.

Research on home sharing indicates that

economic factors are the main motivating

factor for shared housing.

Evidence from

Zillow suggests a relationship between

the unaffordability of rental markets and

“doubling up” behavior. For instance, in

2017, Los Angeles had the highest share

of adults living with roommates or adult

parents (50 percent), while also being the

third most expensive rental market in the

country.

Interviews with shared housing

organizations indicate that economic

factors are the primary reason people

share housing.

Lifecycle factors—such as age, marriage,

and having children—also influence

a person’s housing preferences.

Traditionally, young adults rent

housing until they have accumulated

enough wealth or until they marry, at

The costs associated with homeownership also play a role, including the downpayment and ongoing maintenance. Research points to wealth and income as some of

the largest barriers to homeownership, particularly because of the large upfront cost in the form of a downpayment. Despite the link between homeownership and the

building of wealth in the long run, owning is generally more expensive than renting, so financial constraints can be a barrier to homeownership and influence a person’s

decision on whether to rent or own, and whether to live alone or share housing. Shared arrangements make housing more affordable by reducing housing costs for the

individuals involved.

iii

Manhertz, Treh. 2020 “Almost 3 Million Adults Moved Back Home in Wake of Coronavirus.” Seattle, WA: Zillow. https://www.zillow.com/research/coronavirus-adults-

moving-home-27271/. Analyzing CPS data, Zillow research analysis reports that roughly 2.7 million adults moved in with a parent or grandparent in March and April of

2020. About 2.2 million of the adults were between 18 and 25 years old. The Zillow article notes that the living situation of this age group fluctuates in normal times, and

the volatility of their living situation is exacerbated during the COVID-19 pandemic due to uncertainties in labor markets and of in-person attendance at universities.

which point they may have increased

their income or accumulated enough

wealth to afford the upfront costs of

homeownership.

Renting also provides

people with flexibility to move for

employment or other reasons, whereas

homeowners are frequently tied to their

area of residence. Moreover, the ability

for shared housing to foster the sharing

of childcare gives mothers more time to

invest in their own human capital and

improve their economic position

—key

factors for consideration in addition

to preferences for proximity to work,

family, and amenities.

Sharing housing is also a viable option for

those experiencing economic insecurity

who need a place to live. After all, if

an individual’s income is impeded due

to a job loss, shared housing can help

alleviate the financial burden of housing

costs by sharing that cost with family

or others. Economic downturns appear

to influence the rate of shared housing.

For instance, according to the U.S.

Census Bureau, the number of shared

households increased during the Great

Recession.

A 2012 Census report

found that in 2007, 13.9 percent of

households, or 31.0 million households,

included an additional adult; in 2010,

that percentage increased by 3 million

households to 34.5 million households,

or 15 percent of all households. Of the

roughly 31 million households that

included an additional adult in 2007, 2.4

percent, or 5.3 million households, were

households with an unrelated adult, and

those figures increased to 2.7 percent,

or 6.3 million households, in 2010.

Most commonly, the additional adult in

a household was a relative or child of

the householder. These changes show

that macroeconomic conditions can lead

individuals to share housing to reduce

housing costs, and that they will often

double up with family members first.

iii

Social Factors for

Shared Housing

Although economic factors are the

primary motivator for people sharing

housing, there are many social benefits

to consider in shared housing, including

companionship—whether in the form

of a housemate, a cohabitating partner,

a relative, or a marriage. Most residents

of shared housing report having at

least occasional social events with the

participation of the full household.

They report emotional support and

companionship as the best aspects about

living in a shared house, and a lack of

privacy, a need to compromise or restrict

lifestyles, and having to cope with other

housemates’ moods as the worst.

Living

with someone can increase social support

and interaction; this increase can reduce

loneliness, which can have positive health

effects.

Research indicates that loneliness

is associated with reduced overall well-

being, including both poorer physical

and mental health.

In a 2010 study, He, O’Flaherty, and

Rosenheck questioned why shared

housing arrangements were uncommon

or discouraged policy responses for

formerly homeless people or people

at risk of homelessness, and whether

there were any adverse effects to

sharing housing.

In doing so, they

analyzed data from the Department of

Health and Human Services’ Access to

Community Care and Effective Services

and Supports (ACCESS) program, a

5-year demonstration program meant to

identify and evaluate the effectiveness of

integrated service systems for homeless

populations with serious mental

illnesses.

They found that shared

housing did not negatively impact

participants’ mental health.

According to interviews with shared

housing organizations, homeowners

participating in shared housing programs

are often senior citizens living alone.

Due to ties to one’s home and community,

most senior homeowners want to age

in place, even if their homes cannot

meet their physical needs.

In many

cases, these seniors benefit from shared

housing arrangements, not only because

of reduced housing costs, but also

the additional companionship, social

interaction, and assistance with needs.

One study of home-sharers found that

residents aged 70 and above with a

roommate reported better health across

multiple dimensions, including sleeping

and eating better, feeling happier,

increased physical activity and energy

levels, and worrying less.

In many cases,

seniors benefit from

shared housing

arrangements, not

only because of

reduced housing

costs, but also

the additional

companionship,

social interaction, and

assistance with needs.

Like any other housing arrangement,

however, shared housing requires

compatibility among the individuals

involved. Clashes in personality, work

schedules, lifestyles, and noise levels can

The ACCESS (Access to Community Care and Effective Services and Supports) program was a 5-year demonstration that evaluated the impact of integrated services on

outcomes of homeless people with severe mental illness. The program took place from 1994 to 1998 and was sponsored by the U.S. Department of Health and Human

Services. The program provided funding and technical assistance to experimental and control sites in nine different states and provided funding for outreach and

services at each site. Data was collected on participants at entry into the program and 3 and 12 months later. Outcome data was collected from 7,055 participants. For

more information on the ACCESS program, see: https://ps.psychiatryonline.org/doi/pdf/10.1176/appi.ps.53.8.945.

lead to conflicts between individuals

in shared housing. Indeed, one must

consider many social factors when living

with another person. These arrangements

are based on the trust between the

individuals involved. This trust includes

the safety of the participating individuals

and the property and the commitment of

the individuals to pay their portion of the

housing costs and split the labor for any

domestic chores.

Trust is crucial in

managing conflict.

Trust is crucial in managing conflict.

Conflict can arise from power imbalances

(between resident owners and tenants) or

when tenants have different expectations

for the household. Qualitative research

has shown that individuals who have

a greater commitment to sharing, did

not choose to live in shared housing

solely for financial reasons, and

approach shared housing lifestyles with

a willingness to compromise, are better

at managing conflict.

The quality of

relationships and the way in which

residents choose to engage in them

can greatly affect the social and health

benefits of sharing housing.

The quality of

relationships and the

way in which residents

choose to engage

in them can greatly

affect the social and

health benefits of

sharing housing.

Importantly, shared housing

organizations often take on the burden

of trust in some form by vetting

participants, arranging interviews

between participants, following up with

participants, and acting as mediators in

case of conflict. Digitalization and the

advancement of technology have also

led to the capacity for individuals to vet

new tenants; this practice lowers the

risk of introducing an individual into a

space who has different household and

lifestyle expectations, but can also lead

to discrimination.

Digitalization can

also facilitate the logistics of independent

house sharing and remove barriers to

contractual obligations, such as splitting

utility bills.

Health Factors for

Shared Housing

Social relationships are a major benefit

of shared housing and can mitigate the

substantial negative health effects that

often accompany social isolation and

loneliness. A meta-analysis of studies

examining the connection between

loneliness and health found increased

mortality rates among those reporting

loneliness, social isolation, and living

alone.

Mechanisms for this increased

mortality risk include poorer health

behaviors when living alone, like poorer

sleep, physical inactivity, and smoking.

Being part of a social network at home

is associated with conformity to certain

social norms around health and self-

care. Having social relationships can

also provide individuals with self-esteem

and greater purpose. Additionally, the

decreased social isolation associated with

shared housing can reduce the risk of

domestic violence.

Health benefits can also stem from the

economic benefits of shared housing.

Cost savings derived from shared housing

can free up expenditures for families in

shared households to invest in better

food and in necessary medical costs,

Insights into Housing and Community Development Policy

U.S. Department of Housing and Urban Development | Ofﬁce of Policy Development and Research

both preventive care and direct treatment.

Studies have found that shared housing can

better support children with health issues

ranging from asthma to malnutrition.

An array of economic and social factors

influence the positive impact that shared

housing can have on residents’ health.

Health Considerations for Shared Housing During a Public Health Emergency

Shared housing can be associated

with negative health impacts if

it results in overcrowding. This

association is especially pertinent

given the time of publication, where

the COVID-19 pandemic continues

to affect the way of life across the

world, and, by some metrics, seems

to be spreading more quickly in

areas with higher residential density.

The connection between disease and

density, however, is not immediately

obvious. With COVID-19, some rural

recreation areas in the United States

have seen similar rates of infection

spread as in dense urban areas.

The geography of socioeconomics

also plays a large role. According to

urbanist Richard Florida, “There is a

huge difference between rich dense

places, where people can shelter in

place, work remotely, and have all of

their food and other needs delivered

to them, and poor dense places,

which push people out onto the

streets, into stores and onto crowded

transit with one another.” These

complexities have been addressed in

the shared housing literature through

the “voluntary vs. involuntary” lens,

namely, delineating shared housing

behavior and outcomes based on the

constraints under which individuals

either choose or are forced to live in

shared housing.

Public health situations like the

COVID-19 national emergency,

ongoing at the time of this paper's

publication, can present residents

sharing housing with some

challenges, which are similar to

challenges residents may face around

other household expectations, like

chores, rules about visitors, and

other household activities, but are

compounded due to the severity of

the risks to health and livelihood.

Shared housing residents who have

come together through shared beliefs,

like in many co-ops and other types

of intentional communities, may be

more willing to develop and comply

with new household policies during

emergency scenarios. For example,

certain medium-sized co-ops in

Oakland, California; San Francisco,

California; Berkeley, California;

Boulder, Colorado; Providence,

Rhode Island; New York City, New

York; and Austin, Texas have all

published household policies that

they developed and co-signed under

COVID-19, many categorizing their

allowable activities into different

phases of the pandemic. The Centers

for Disease Control and Prevention

released safety information on

living in shared housing during the

COVID-19 pandemic, including

limiting or avoiding nonessential

visitors and stocking COVID-19

prevention supplies, such as soaps,

sanitizers, tissues, trash bins, and

if possible, cloth face coverings.

Maximizing health and happiness

during crisis situations involves

a level of trust between shared

housing residents that there will

be compliance with agreed-upon

household expectations. It may also

involve meeting certain housing

quality standards to ensure that any

resident who becomes affected by the

virus can self-isolate without harming

their housemates.

Pandemics such as COVID-19 are

once-in-a-lifetime events, and, while

governments should always invest in

emergency preparedness, pandemics

may present characteristics of

a “black swan” event (that is,

rare and unpredictable events

despite post-hoc rationalizations

for predictability), requiring ad

hoc policies to respond to crisis

scenarios. How residents and owners

of shared housing make contingency

plans to protect their health and

safety during public health crises

may play a lesser role in the overall

health of residents in their long-term

relationship with shared housing.

Sources: Florida, Richard. 2020. The

Geography of Coronavirus. CityLab.

https://www.citylab.com/equity/2020/04/

coronavirus-spread-map-city-urban-

density-suburbs-rural-data/609394/

Tina, Cynthia. 2020. COVID-19

Resources. Center for Intentional

Community. https://www.ic.org/

covid-19-resources/

Center for Disease Control. 2019. Living

in Shared Housing. https://www.cdc.gov/

coronavirus/2019-ncov/daily-life-coping/

shared-housing/index.html

Social relationships are a major benefit

of shared housing and can mitigate the

substantial negative health effects that often

accompany social isolation and loneliness.

Prevalence of Shared Housing

in the United States

One can measure the prevalence of

shared housing in the United States using

multiple approaches. Here, we look at

data captured by major federal surveys.

We examine the following variables

captured by the American Housing

Survey (AHS), American Community

Survey (ACS), and Current Population

Survey (CPS):

the number of unoccupied

bedrooms in housing units, the number

of families per household, the types of

families in households, the relationship

Data from the Current Population Survey (CPS) and American Community Survey (ACS) provide information on household composition in the United States. The

ACS is an ongoing household survey that samples approximately 3.5 million randomly selected households per year. The survey captures detailed social, demographic,

economic, and housing data of the U.S. population. Surveys are conducted by mail through a questionnaire delivered to an address, via internet, through in-person

interviews by U.S. Census Bureau field representatives, and by telephone.

The

CPS is a household survey conducted monthly, using a probability sample of roughly 60,000 households. Households are interviewed by Census field

representatives once a month for 4 consecutive months, and then interviewed again over the same 4 months, 1 year later. Households from each state and the District of

Columbia are included in the survey. The survey provides information on the labor market and household composition and demographics. Data from the Annual Social

and Economic Supplement (ASEC) of the CPS provides further detailed social and economic information on individuals in a household and household composition.

ASEC data is used by the U.S. Census Bureau to measure poverty.

The

American Housing Survey provides information on the housing stock, vacancies, housing costs, and the condition of housing units, among other detailed information

on housing. The survey is conducted biennially in odd-numbered years. In 2017, the most recently completed survey, the survey sampled 114,860 housing units.

of household members to their head

of household, and multigenerational

households. See Figure 2 for a summary

of the analysis of these variables.

Data from the AHS shows that 76

percent of occupied housing units

have more than one bedroom per

person. Formal measures from CPS

and ACS indicate that shared housing

represents a less common but growing

housing arrangement for American

households, whereas AHS data shows

the capacity for shared housing in

the U.S. housing stock. Data from the

CPS and ACS show that, although the

prevalence of shared housing varies

substantially depending on the age of

the household head, roughly 7 percent

of households contain more than one

family; 9 percent of households include

subfamilies or secondary individuals

(a steadily growing 2-percentage-point

increase in share from 2000 to 2019);

4 percent of ACS respondents are

not related to the head of household;

and 20 percent of Americans live in

multigenerational households with more

than two adult generations (a steadily

growing 8-percentage-point increase in

Figure 2: Metrics on the Prevalence of Shared Housing in the United States

Shared Housing Metric Data Source Time Period Findings

Unoccupied bedrooms American Housing

Survey

2019 Of all occupied housing units:

• 26% have 2+ bedrooms per person

• 50% have 1-2 bedrooms per person

• 24% have <1 bedroom per person

Finder.com analysis

of U.S. Census data

2017 • There are 33.6 million spare rooms in the United States

• There are ~9.4% more bedrooms than people

Number of families

per household

Current Population

Survey

2020 • 94% of households contain one family

• 4% of households contain two families

• 2% of households contain three or more families

Types of families in

households

Current Population

Survey

2020 • 73% of households are primary families

• 18% of households are nonfamily householders

• 9% of households are subfamilies and

secondary individuals

Relationship between

household members

American

Community Survey

2019 • 3% of people identified as nonrelatives in relation to the

head of household

Multigenerational

households

American

Community Survey

2019 • 35% of households are one-generation households

• 53% of households are two-generation households

• 9% of households are three-generation households

Insights into Housing and Community Development Policy

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share from 1980 to 2016). The variance

among these indicators paint a different

picture depending on how shared

housing is defined, demonstrating the

importance of additional research to

capture changes in Americans’ living

arrangements. Overall, these measures

illustrate some degree of increase in the

rate and prevalence of shared housing

and suggest the capacity for further

expansion of such housing arrangements.

Undercrowding occurs when there are too few occupants in a housing unit. In context, this percentage is a national measurement of all housing units, and there is

variation in crowdedness in different housing markets across the United States, where some markets have greater and lesser degrees of crowding and undercrowding in

housing units. In some areas of the United States, there is an acute problem of overcrowding in housing units, notably in Indian Country/Tribal Lands.

Unoccupied Bedrooms

Data on unoccupied bedrooms represent

one measure used to examine the

capacity for shared housing in the

United States. This measure indicates

the capacity for homeowners to engage

in home sharing, based on the presence

of extra unoccupied bedrooms in a

house. The AHS finds that 26 percent of

occupied housing units have two or more

bedrooms per person, whereas 50 percent

have between one and two bedrooms per

person. Having more than one bedroom

per person may make sense if residents

have rooms they use as office spaces

or guest bedrooms; however, couples

typically share a bedroom, which would

reduce the average number of bedrooms

per person. The fact that just 24 percent

of occupied units have less than one

bedroom per person suggests that

undercrowding is much more prevalent

than overcrowding in the United States.

See Figure 3.

According to a 2017 analysis by finder.

com, U.S. Census data show that there

are approximately 33.6 million spare

Figure 3. Number of Bedrooms Per Person in Occupied Housing Units in the United States

Source: American Housing Survey, 2017 National – Rooms, Size, and Amenities – All Occupied Units

60%

50%

40%

30%

20%

10%

Share of occupied housing units

0.66 or less 0.67 to 0.99 1.00 to 1.99 2 or more No bedrooms

11%

13%

50%

26%

The prevalence of shared housing in the

United States likely ranges somewhere

between 3 to 20 percent of households,

depending on the dataset and definition used.

rooms in the United States. This finding

is based on aggregate estimates of

roughly 357 million bedrooms for 324

million people, or 9.4 percent more

bedrooms than people.

This aggregate

estimate is likely an overestimate of the

availability for home sharing because

it appears to include bedrooms in

vacant housing for sale or rent and

does not account for households that

are using their additional rooms for

essential purposes. Separately, a 2017

analysis of local real estate markets

by Trulia examined boomer-headed

households in the 100 largest U.S.

housing markets, and they found

at least 3.6 million unoccupied

rooms, not counting offices or guest

rooms, in these markets.

Either way,

each of these estimates shows the

United States’ potential capacity to

absorb demand for home sharing.

Number of Families Per Household

The Current Population Survey (CPS)

counts the number of families living

in a household, defining family as

anyone related by blood, adoption, or

marriage, whereas unrelated individuals

are counted as a separate family. This

measurement considers households with

multiple generations as one family (for

example, a married couple with children

living together with grandparents would

be counted as one family). According to

CPS data, in 2020, roughly 94 percent

of households contained one family;

4 percent of households contained

two families; and 2 percent contained

three or more families. By counting the

number of families in a household, we

can generally see that roughly 6 percent

of households included more than one

family, and that percentage includes

unrelated adults. These figures have

been relatively stable over the past two

decades. Since 2001, the percentage of

one-family households increased by 0.9

percent at an annual rate of 0.045; the

percentage of two-family households

decreased by 1.06 percent at an annual

rate of 0.063; and the percentage of three

or more family households increased by

0.15 percent at an annual rate of 0.0075.

This CPS data shows that among all

households, sharing housing is relatively

uncommon despite the possible capacity

to do so.

In 2020, among households headed

by those aged 65 and older, nearly 98

percent were one-family households and

2 percent were two-family households,

including unrelated individuals. CPS

data further suggests that relatively few

senior-aged households contained more

Figure 4. Share of Households That Contain More Than One Family by Age Cohort of Householder

2019

2018

2017

2016

2015

2014

2013

2012

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

2011

10.5

10.9

4.7

2.4

5.4

2.6

25-34 35-64 65-99

Source: Current Population Survey, NFAMS variable

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than one family, indicating that there are

few senior-aged households participating

in shared housing relative to households

in other age cohorts. See Figure 4 for a

breakdown by age cohort.

Types of Families in Households

The CPS also counts the types of

families living in a household, defining

five different family types: primary

families, nonfamily householders, related

subfamilies, unrelated subfamilies, and

secondary individuals. By this count,

in 2020 primary families—defined as

a group of two or more people related

by birth, marriage, or adoption that

is living together—make up nearly

three-fourths of all households.

vii

According to CPS data, in 2020, roughly 73.21 percent of households were occupied by primary families; 17.8 percent of households were occupied by nonfamily

householders; 8.98 percent of households were occupied by subfamilies or secondary individuals. Over the past two decades, these percentages have been relatively stable.

Since 2001, the percentage of primary families decreased by 2.54 during the period at an annual rate of 0.127; the percentage of nonfamily households increased by 1.15

during the period at an annual rate of 0.0575; and the percentage of subfamily and secondary individuals increased by 1.39 during the period at an annual rate of 0.0695.

Nonfamily householders, defined as a

person maintaining a household while

living alone or with nonrelatives, made

up about 18 percent of households.

Subfamilies (subfamilies do not maintain

the household but live in someone

else’s home) and secondary individuals

(unrelated roomers, boarders, resident

employees) account for about 9 percent

of the remaining household types.

These data show that most households

in the United States are occupied by

primary families. Unrelated subfamilies

and secondary individuals, who can be

considered as sharing housing, make

up about 6 percent of all households.

See Figure 5 for the percentage of

households with subfamilies or

secondary individuals.

Related subfamilies are defined as a

married couple with or without children,

or a single parent with one or more

children under 18. An example of a

related subfamily is a married couple

sharing the home of the husband’s or

wife’s parents. In 2020, about 3 percent

of households in the United States were

related subfamilies. Unrelated subfamilies

are defined as a married couple with

or without children, or a single parent

with one or more children under

18, and can include guests, partners,

roommates, or resident employees

and their spouses and children. In

2020, 0.18 percent of households

in the United States were unrelated

subfamilies. A secondary individual is

defined as a roomer, boarder, or resident

Figure 5. Percentage of Households with Subfamily or Secondary Individual

Source: Current Population Survey

2019

2018

2017

2016

2015

2014

2013

2012

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

2011

7.5

9.2

employee with no relatives in the

household; this includes group quarter

members not living with a relative. In

2020, about 6 percent of households

in the United States were secondary

individuals. During the same period

about 9 percent of households included

a subfamily or secondary individual.

Relationship Between Household

Member and Household Head

The ACS captures the relationship of each

individual to the household head. Among

the 13 different types of relationships

captured are “other non-relatives”—

defined as people paying or working for

accommodations. ACS data show that

in 2019, 2.95 percent of respondents

identified as other nonrelatives in relation

to the head of household. Since 2001,

that percentage has increased by 1.73 at

an annual rate of 0.091.

A 2018 article from Harvard University’s

Joint Center for Housing Studies

examined the prevalence of shared

housing among people aged 65 and

older. Using 2016 ACS data, the author

found that shared housing arrangements

among people aged 65 and older are

relatively small in scope but increasing.

In 2016, roughly 879,000 people aged

65 and older lived with another unrelated

person, whereas 12.8 million lived alone

and another 21.7 million lived with a

spouse or partner

Though the number and share of

older adults living with unrelated

roommates is small, both grew

dramatically between 2006 and

2016. Over that time, when the

older population grew from 38 to 50

viii

Pew Research shows that Asian and Hispanic populations are more likely to live in multigenerational households than White households, and these populations are

growing more rapidly than White populations in the United States. Indeed, in 2016, the shares of households that are multigenerational are higher among Asians (29

percent), Hispanics (27 percent), and Blacks (26 percent) than among White households (16 percent).

million, an increase of 33 percent,

the segment of the older population

sharing their homes grew from 1.3 to

1.8 percent, and the number of older

adults in these arrangements grew by

88 percent (from about 470,000 to

nearly 988,000).

Separately, the Census released a report

on shared households in 2012 titled,

“Poverty and Shared Households by

State: 2011,” which found that in

2007, 17.6 percent of households were

shared households, and in 2010, that

number increased to 19.4 percent.

Also, the report found that in 2007,

16 percent of adults were additional

adults in a shared household, and that

in 2010, that number increased to 17.3

percent.

The report further found that

most (80.8 percent) additional adults

in shared households were relatives of

the householder, whereas 19.2 percent

were not relatives. Adult children of the

householder were the most common

additional adult at 47.1 percent,

whereas 8.1 percent were siblings, 9.6

percent were parents, and 16 percent

were other relatives.

Multigenerational Households

Finally, ACS data on multigenerational

households in the United States is

examined. Multigenerational housing

is a common living arrangement in the

United States; it is a household that

consists of at least two adult generations.

Most commonly, this arrangement

occurs when grandparents live with

their adult children and grandchildren.

Multigenerational housing can provide

a range of benefits for participating

individuals. In addition to reduced

housing costs for participants,

such arrangements can allow for

grandparents to “age in place” in a

familiar environment. Grandparents

can also help parents supervise their

children, reducing the costs for daycare

and other childcare. See Figure 6 for

the percentage of Americans living in

multigenerational households.

In 2019, among all reporting adult

households, about 35 percent were

one-generation households, 54 percent

were two-generation households, and 9

percent were three-generation or more

households. Since 2001, the percentage

of one-generation households increased

by 0.63 at an annual rate of 0.033; two-

generation households decreased by 5.07

percent at an annual rate of 0.267; and

three or more generational households

increased by 1.97 percent at an annual rate

of 0.104. The share of households with

three or more generations has increased in

recent years.

Analyzing ACS data, Pew Research

found that in 2018, 20 percent of the

population lived in multigenerational

housing, a 5-percentage-point increase

from 2000.

In their analysis, they

define multigenerational housing

as housing that includes “two or

more adult generations, or including

grandparents and grandchildren

younger than 25.” The increase in

multigenerational households can be

explained partially by the increase of

racial and ethnic diversity in the United

States and different cultural preferences.

viii

Overall, based on varying methods

of counting members of households,

shared housing is a small but growing

way of living in the United States.

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Shared Housing Models in the United States

We now provide an overview of two of

the primary models for shared housing:

home sharing and co-living. Home

sharing and co-living are operated

by both nonprofit and for-profit

organizations in the United States, and

they tend to range in the length of their

leases and in their affordability. Several

existing home sharing and co-living

organizations were interviewed to obtain

qualitative information about their

operations for this section.

Home Sharing

Home sharing organizations are

intermediary organizations that match

shared housing seekers to shared housing

providers. Home sharing is available to all

age cohorts, from young adults starting

new jobs in big cities to retirees looking

for extra income to help pay mortgages

and property taxes. Most home sharing

participants who share their homes are

older adults, however.

Home sharing organizations have

been operating in the United States for

decades, with some current organizations

having programs that began in the 1970s

or 1980s. Home sharing organizations

in the United States have adapted their

models of matching home seekers

and home providers over time. The

National Shared Housing Resource

Center (NSHRC) operates as a network

for home sharing organizations in the

United States, promoting best practices

among home sharing organizations

and providing resources and learning

opportunities for practitioners.

The

housing model for home sharing

organizations, including best practices, is

explained on the next page.

Typically, home seekers and providers

contact a home sharing organization

seeking a home sharing match.

Organizations often list their criteria for

participating on their websites and allow

participants to apply online through a

website template, or via e-mail or telephone.

For participants providing housing, the

organization typically visits and inspects the

unit prior to placing a participant seeking

housing.

After participants apply, they

are screened through background checks

Figure 6. Increasing Share of Americans Living in Multigenerational Households

Sources: Pew Research Center, 2018; Decennial census and ACS data

20%

15%

10%

1980 1990 2000 2009 2016

12%

14%

15%

17%

20%

Home Sharing Model

Vetting Process

Thorough vetting and interview

processes help ensure a successful

match is made between participants.

Home sharing organizations interview

home providers to understand the

types of arrangements they seek.

The information gathered includes

preferences on desired rent payment;

the type of services preferred, if any;

and compatibility information, such as

sharing with an individual or a family,

work schedule, and so on. The vetting

process—including applications,

background checks, and participant

interviews—helps maximize the

likelihood of compatibility among

participants. Through a trial

period, follow up, and mediation,

the organizations provide further

assistance to ensure successful matches

for participants.

Although shared housing

organizations use similar models

for matchmaking, they can differ in

a variety of ways, including length

of leasing, rent payment, services

provided, and client base.

Length of Leasing

Home sharing organizations differ in

the length of leasing arrangements

for their matches—whether short-

term (such as month-to-month

leasing arrangements) or long-term

(a year or more). For example, in San

Mateo, California, Human Investment

Project (HIP) Housing participants

seek and enter into month-to-month

arrangements. On average, home

sharing arrangements last 2 to 3 years

in duration, with some arrangements

lasting 10 years or longer. Other

organizations facilitate month-to-

month arrangements, which on average

last 1.5 years. Participants move on for

many reasons, including changes in

lifestyle or living situations.

Client Base

Although most shared housing

organizations are available to anyone

seeking housing, the client base of

some organizations differ. For example,

Impact Justice in Alameda County,

California, began a pilot program

called The Homecoming Project,

which matches formerly incarcerated

people with participating homeowners

providing short-term housing limited

to 6 months. The Homecoming Project

aims to reduce the recidivism rate

among the formerly incarcerated by

providing short-term, stable housing to

help increase their chances to re-enter

society. The Homecoming Project

subsidizes homeowners and, like other

shared housing organizations, screens

participants, facilitates the matching

process, and offers follow up support.

Some shared housing organizations

adapt their shared housing programs

to meet demand for their services.

For example, HomeShare Vermont

began their home sharing program by

matching senior-aged home seekers

to senior-aged home providers. They

found that the program gained interest

in other age cohorts, however, and

they then began an intergenerational

approach to home sharing that did not

restrict participants by age or income;

this approach opened the program to

more participants.

Payment (Exchange of Rent

and Services)

When interviewing prospective

home providers, shared housing

organizations ask what type of rent

payment or services the home provider

is seeking, whether rent payment

only, services only, or a combination

of rent and services. Likewise,

prospective home seekers are asked

about their preferences and their

ability to provide rent payment and

services. Rent can range extensively

depending on the location of the

shared housing arrangement. Services

can include housework, yardwork,

pet care, fellowship and conversation,

or running errands to the grocer or

pharmacy, and so on. Services are often

specified in terms of number of hours

per week or month. Services typically

do not include personal care.

Sources: Phone interviews with HomeShare

Vermont (conducted on June 25, 2019) and

HIP Housing (conducted on June 25, 2019)

and are interviewed by the organization,

after which the organization arranges for

the home seeker and home provider to

meet.

Finally, after a trial period, the

participants enter into a more formal leasing

agreement.

Once participants are settled,

organizations follow up with participants to

ensure satisfaction and mediate in the case

of conflict between participants.

Co-Living

Co-living organizations are a type

of shared housing organization

that facilitate co-living—a housing

arrangement in which a tenant pays

rent for a private bedroom but shares

common living areas such as kitchens,

bathrooms, and laundry facilities with

other tenants. Co-living is convenient

for people just arriving to a new city

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or for people looking for an affordable

housing option in a high-demand area.

Part of the co-living appeal is found in

the convenience and all-inclusive pricing

for renters, at the expense of reduced

privacy and smaller living spaces. Co-

living organizations typically bundle

their rent, utilities, and Wi-Fi into an all-

inclusive rate for renters. Many co-living

providers offer fully furnished dwellings,

including furnished bedrooms, but

provisions vary across organizations.

Co-living buildings can range from large

multi-unit buildings to renovated single-

family homes with multiple bedrooms.

Co-living buildings are built or renovated

to maximize density by adding extra

bedrooms, which can reduce the amount

of square footage in a bedroom or

common area, such as a living room,

compared to traditional units. For new

developments, co-living organizations

advise developers on how to best

optimize properties for co-living, while

for renovations, co-living organizations

advise property owners how to optimize

current space for maximum density.

Co-living buildings can be found in

Atlanta, Chicago, Los Angeles, New York

City, San Francisco, and Washington,

D.C., among other major U.S. cities.

The increasing market capitalization of

co-living shows that it is a fast-growing

real estate sector, with opportunities

to significantly impact urban housing

markets in the United States.

Of the total investment in co-living specific to the United States through 2018, 55 percent was made in 2018. Moreover, combined capital investment fundraising

in U.S. and international co-living housing markets has grown more than 200 percent annually since 2015. In 2019 alone, about $3 billion in funding was secured

for co-living development in the U.S. and international markets. Jones Lang LaSalle. 2019. Why investors are signing up for coliving. June 17, 2019. https://www.

us.jll.com/en/trends-and-insights/investor/why-investors-are-signing-up-for-coliving.

The increasing market

capitalization of co-

living shows that

it is a fast-growing

real estate sector,

with opportunities to

significantly impact

urban housing markets

in the United States.

Co-living organizations often have

user-friendly websites and mobile apps,

which serve as one-stop shops for

renters and prospective renters. Housing

seekers can apply for membership and

set up appointments for viewing units

(some co-living organizations offer

virtual tours), whereas current renters

can pay rent and request services and

maintenance. It makes sense that co-

living is technology-driven, given

its origin during the digital age and

its typical target market, which are

technology-savvy younger generations.

Variance in Co-Living Models

Co-living companies are typically

organized into three different models:

the operator model, the full stack

(developer-owner-operator) model,

and the single-family conversion

model.

Co-living organizations operate

differently throughout the United States

depending on local regulations, the

types of co-living models in operation,

and their target demographics. For

example, Common is a co-living

organization operating in eight major

cities (as of 2020), with plans to expand

to more U.S. cities.

Common operates

similar to hotels, in that it offers rooms

and common areas with high-end

furniture, weekly cleaning, household

supplies (such as paper towels, toilet

paper, and cleaning supplies), and

monthly community-building events.

Common includes the costs for these

amenities, including utilities and Wi-Fi,

in the cost of rent, so that the price is

all-inclusive for renters. Rent for these

co-living arrangements is at or near the

market rate for similar group house

listings, but because co-living comes

with furnished rooms and all-inclusive

pricing, collecting payment for utilities

or other amenities is no hassle. These

higher-end co-living arrangements

are typically marketed toward people

earning incomes of $60,000 to $80,000,

or who are college-educated young

professionals moving to a new city

and are seeking convenient housing.

Source: Cushman & Wakefield, https://cw-gbl-gws-prod.azureedge.net/-/media/cw/americas/united-states/insights/research-report-pdfs/2019/

coliving-report_may2019.pdf (p. 39)

Figure 7. Major U.S. Co-Living Developments

Figure 7.

Note this figure does not include every coliving organization in the United States. For example, PadSplit, based in Atlanta, has a current estimate of approximately

1,000 units, with an additional 2,000 units in the pipeline.

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Co-Living Model

Leasing

Co-living organizations vary in

their leasing arrangements. Some

organizations own and manage the

unit or building and lease to tenants in

traditional leasing agreements. Other

organizations facilitate short-term

rentals for property owners looking to

rent out a property. Similar to home

sharing organizations, co-living leasing

arrangements can vary in duration from

a single night to a full year or longer,

depending on the co-living provider and

the type of arrangement. The co-living

provider is typically the leaseholder, so

tenants sub-lease the rental space. For

Common, the typical lease length is

around 12 months, but shorter leasing

options ranging from 3 to 9 months

are also offered. For PadSplit, members

typically stay about 7.5 months.

Vetting Process

Co-living organizations vet prospective

members to ensure a safe living

environment for all tenants. To become

a co-living member, individuals typically

must apply through online applications.

Some organizations charge one-time

application fees. Once applications are

received, co-living organizations usually

run credit and criminal background

checks. Once background checks

are cleared, applicants are offered

membership and can begin applying to

rent vacant units.

Rent Payments

Depending on the co-living organization

and the leasing arrangement, rent

payments can be due monthly or weekly.

Co-living members are only responsible

for the rent owed for their room, not the

rent for the entire house or unit. Rent

amounts can vary as well, with some

organizations charging the market rate

and others charging more affordable

rental rates.

Sources: Phone interviews with Common and

PadSplit conducted on January 24, 2020

Figure 8. Common’s Co-Living Model

Traditional Rental Co-Living

Bedroom Living Space Bathroom Amenities Services and Technology

Source: Common, https://www.common.com/blog/2019/10/common-announced-as-winner-of-sharenyc-hpd

Other co-living organizations offer fewer

amenities, while still including fully

furnished buildings and all-inclusive

pricing for renters. These are generally

marketed toward temporary workers,

and those earning lower incomes, who

are seeking affordable housing.

For

example, PadSplit, based in Atlanta,

offers co-living housing at affordable

prices, where the average income of their

members is $21,000.

Challenges Faced by Shared

Housing Organizations

Shared housing organizations face a

variety of challenges in their operations.

Some include the availability of housing

stock, financing availability, and local

regulations that restrict shared housing.

Housing Availability

Demand for shared housing and

services from shared housing

organizations (both home sharing and

co-living organizations) exceeds the

availability.

In other words, there

are many more people seeking shared

housing arrangements than there are

formal shared housing arrangements

available. Finding available home

providers is a challenge for shared

housing organizations.

The older

that homeowners become, the less

likely they are to share their homes.

In some instances, by the time senior

homeowners come around to the idea of

shared housing, they need professional

care beyond that which can be provided

through shared housing arrangements.

There are many more

people seeking shared

housing arrangements

than there are formal

shared housing

arrangements available.

Due to the lack of available home

providers, and by nature of the

arrangement, shared housing

organizations cannot guarantee

placement for home-seeking participants.

Depending on the area, three to five

times as many shared-housing seekers

can exist as available providers.

When

there is a waitlist, shared housing

Some appraisers will not appraise the value of the home without a comparable housing unit. For single-family homes, appraisers generally determine the value of a

home using a comparison approach, where they determine the value of a property by comparing it to other properties within the area that are similar in size and room

count. They determine value by looking at home sales in the area over the previous three months, and adjust that value based off of location, upgrades, and other

variables. Assessing the value of a home can be more difficult without a comparable housing unit, which is the case with co-living residences in single-family homes.

Source: phone interview with PadSplit conducted on June 30, 2020.

organizations generally inform new

home-seeking participants of other

housing resources in the area.

Funding Availability

Funding for shared housing varies

depending on the business model of the

shared housing organization. Many shared

housing organizations, especially home

sharing organizations, operate as nonprofit

organizations in the United States. As

such, identifying funding sources can be

a challenge, particularly when operating

resource-intensive programs such as

home sharing, where staff are needed for

each phase of shared housing. Funding

sources for nonprofit providers vary by

organization, but include fundraising,

donations, grants, state funds, and funds

raised through partnership with other

nonprofit organizations with similar

housing objectives.

Securing funding—particularly financing

for new loans—can also be a challenge

among for-profit co-living organizations.

Many lenders are hesitant because co-

living is a relatively new housing model,

and fewer underwriting guidelines have

been established.

Developers may be

reluctant to engage an investment project

involving the co-living model if there is

ultimately the risk they would have to

rebuild and renovate the building if the

project is unsuccessful.

For renovations,

it can be difficult for owners to secure a

traditional, lower-rate construction loan

because co-living is a new housing model

and lenders are not ready to underwrite

the risk. Even if the owner can go

through with renovations, the owner may

have difficulty having the value of the

property appraised without a comparable

unit in the area.

Despite these challenges with a nascent

model, capital for co-living real estate

development can be raised by pointing

to the potential returns. Indeed, many

for-profit co-living models can charge

higher rents and net higher profits than

traditional types of multifamily apartment

buildings.

These gains can motivate

private investors who are willing to take

on more risk to invest in developments

built for co-living models.

Complying with Local Regulations

Depending on the jurisdiction, shared

housing can be subject to the same or

different land-use and zoning regulations

as other housing types. Navigating local

regulations can be a challenge, especially

when organizations attempt to scale

operations across cities and jurisdictions.

These special housing types can be

difficult for regulators to assess within

local jurisdictions.

Residential zoning ordinances can

restrict the ability to share housing,

thereby restricting the availability of

affordable housing in an area.

Zoning

ordinances determine how land is

used and what types of buildings and

features are permitted or prohibited on

apportioned land. Zoning is the act of

partitioning land in a municipality for

different purposes, such as for residence

or commercial use.

Most land is not

zoned federally in the United States;

state governments have the authority to

enforce zoning regulations, and states

typically delegate that authority to local

governments and municipalities.

Land-use regulations are traditionally

put in place for reasons of public health

and safety, and they also typically provide

benefits to existing homeowners through

restrictions on land uses and building

allowances. Zoning regulations that set

density restrictions, height restrictions,

parking requirements, minimum lot sizes,

and open space requirements, among

other rules, can discourage development

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in areas where builders could otherwise

maximize the number of units on land

parcels and their occupancy to increase

profitability. Of particular relevance,

shared housing organizations can

operate in multifamily residential zones,

but with the exception of a few localities,

in the United States, the majority of land

zoned for residential uses is zoned for

single-family homes. This section focuses

on several local land-use regulations

that especially affect shared housing

opportunities: occupancy standards,

density regulations, and rules around

accessory dwelling units (ADUs). A

brief overview of strategies to reduce

regulatory barriers to shared housing is

also provided.

Occupancy Standards

Housing regulations that impact

shared housing organizations include

occupancy standards, which limit the

maximum number of people who may

reside in a dwelling unit. For example,

the “U plus 2” occupancy ordinance

in Fort Collins, Colorado, restricts the

number of unrelated people who may

live in a house to three people.

xii

The

city of Fort Collins has recently been

considering amending their occupancy

limit law to allow more people per

dwelling unit, so long as they adhere

to additional safety and community

standards.

The current ordinance is

unfavorable among students at Colorado

xii

The “U plus 2” occupancy limit law, enacted in the 1960s, set the maximum permissible occupancy of a dwelling unit at one family and not more than one other

person; or two adults and their dependents and not more than one additional person; or up to three unrelated persons in a dwelling unit located in an apartment

complex containing units which were approved by the city.

State University in Fort Collins because

it reduces the availability of affordable

housing by restricting the number of

people who may live in a dwelling

unit. By contrast, in Washington, D.C.,

occupancy limit laws allow up to six

unrelated people to live in a single-

family home.

Restrictive occupancy

laws have a direct impact on the ability

for residents to engage in shared

housing models.

In Washington,

D.C., occupancy

limit laws allow up

to six unrelated

people to live in a

single-family home.

Density Regulations

Land-use ordinances that limit the

number of housing units per acre

can adversely impact the availability

of affordable housing in an area by

reducing the overall supply of available

housing.

These land-use ordinances

can hinder not only population growth,

but also economic growth in a city, due

to constraints on labor markets and

productivity.

As employment grows

in a city, the cost of housing in areas

with density restrictions rises, pushing

people to suburban or exurban areas.

Density restrictions and restrictions on

residential building features—down to

parking and setback requirements—can

affect the capacity for shared housing

arrangements and whether homeowners

can participate. The tightening of a

housing market and associated increases

in rents and home prices may lead more

individuals to choose to share housing to

save on housing costs but still live near a

preferred location.

Restrictive

occupancy laws have

a direct impact on the

ability for residents

to engage in shared

housing models.

Accessory Dwelling Units

Some local jurisdictions allow for

homeowners to convert a portion of their

house or property to an ADU. ADUs—

also known as accessory apartments,

secondary suites, in-law apartments,

“granny” flats, carriage houses, backyard

cottages, and annexes—are dwelling

units on a single-family lot that are

not the primary residence. There are

physical limitations to ADU conversions,

and some may be better suited for

detached homes with larger lot space

for conversion. ADUs require bathroom

and kitchen facilities, and they can

be connected or disconnected from

the main housing unit. Commonly,

homeowners with basements or attic

spaces will convert those areas into a

separate ADU.

ADUs provide an additional housing

unit on a property at an affordable

price. ADUs provide additional income

for homeowners, despite their initial

construction cost. ADUs allow for

greater privacy for the homeowner than

a home sharing arrangement, while still

providing many of the same benefits of

shared housing and affordable housing

for the ADU tenant.

Local regulations may prohibit building

ADUs because of density limits or

concern over homeowners’ property

values. Narrow land uses due to zoning

in many cities prevent alternative

housing options like ADUs, duplex

With the exception

of a few localities,

in the United States,

the majority of land

zoned for residential

uses is zoned for

single-family homes.

and triplex housing, and multifamily

buildings.

In January 2020, the

California state legislature passed a bill

expanding ADU permittance to two

ADUs per single-family lot, including

one full unattached ADU and one junior

ADU that is converted from part of an

existing residence. Washington, D.C.

allows ADUs by-right in certain less

densely populated neighborhoods and

has rules around a home’s eligibility

for ADU conversion (for example,

xiii

Other HUD programs fund home rehabilitation, including the Federal Housing Administration 203(k) rehab mortgage insurance program and the HOME

Investment Partnerships Program managed by the Office of Community Planning and Development. Although these programs are not specific to shared housing, home

rehabilitations can be done to facilitate shared housing.

minimum floor area), having a separate

entrance, and other requirements.

Most jurisdictions in the United States,

however, have yet to allow for ADU

development, despite the ease of their

ability to increase the supply of housing

in a flexible manner.

Reducing Regulatory Barriers

Reducing zoning and land use

regulations can make housing

more affordable in areas with high

housing costs. For example, in 1969,

Massachusetts recognized the need to

increase affordable housing in suburban

areas, which were predominantly zoned

for single-family houses, and enacted

the Comprehensive Permit and Zoning

Appeal Law. That law simplified the

permitting process and encouraged

affordable housing development.

In 2017, California enacted laws to

require local governments to adopt

ADU ordinances to facilitate ADU

development.

The law reduced

restrictions placed on ADUs, including

building features, proximity to transit,

parking requirements, and other

regulations. Among major metropolitan

areas in California, ADU permits

increased from 225 in 2015 to 8,875

in 2019.”

The addition of ADUs to the

housing stock of major cities in California

has helped to provide affordable housing

units in these high-demand areas.

Although some land-use and building

regulations are necessary for safety,

others can impede the availability of

affordable housing, particularly in

densely populated areas. In recognition

of the role regulatory barriers play in

reducing the availability of affordable

housing, the White House issued an

Executive Order establishing the Council

on Eliminating Regulatory Barriers to

Affordable Housing, chaired by the

Secretary of HUD.

HUD published a

request for information on the topic of

regulatory barriers to better understand

how they impact local housing markets

in areas with high housing costs.

Federal and State Programs and Initiatives for Shared Housing

Some federal and state programs and

initiatives allow for shared housing. This

section discusses the role of shared housing

in HUD’s Housing Choice Voucher (HCV)

program and examines state shared housing

initiatives in New York, Pennsylvania, and

Massachusetts. This section also includes

information on HUD’s international

research partnerships on shared housing.

HUD Housing Choice Voucher

Program and Shared Housing

Shared housing is permitted in HUD’s HCV

program.

xiii

Rules on the allowable use of

shared housing living arrangements in

tenant-based rental assistance are specifically

detailed under the HCV program. HUD

regulations for shared housing occupancy

are found in 24 CFR § 982.615 through 24

CFR §982.618. There, HUD defines shared

housing as an assisted family sharing a

housing unit (either a house or apartment)

with another resident or residents. Assisted

families can share housing with other

assisted or unassisted families. Although the

owner of the unit may reside with assisted

families, assisted families may not be related

to the owner, nor can housing assistance

be paid on behalf of the owner. The shared

housing unit must meet the housing quality

standards (HQS) under 24 C.F.R. §982.401.

Rent Calculation for Shared Housing

in HCV

Public housing authorities (PHA) are

bound by the fair market rent (FMR) of an

area when calculating housing subsidies

for an individual. FMRs are used to

determine payment standard amounts for

the HCV program, in addition to payment

standards for other HUD assisted housing

programs. HUD calculates FMRs annually,

with the goal of providing affordable

housing to program participants within

Narrow land uses

due to zoning

in many cities

prevent alternative

housing options like

Accessory Dwelling

Units, duplex and

triplex housing, and

multifamily buildings.

HUD defines shared housing as an assisted

family sharing a housing unit (either a house or

apartment) with another resident or residents.

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an FMR area. FMRs are set high enough

to include many units and neighborhoods

but set low enough to serve as many

program participants as possible. The

current FMR definition sets the level at

the 40th percentile of rent or the amount

below which 40 percent of standard-

quality rental units are rented.

HUD regulations for rent payments and

voucher usage in shared housing are

found in 24 CFR § 982.617. Rent in

shared housing is calculated pro rata—by

dividing the number of bedrooms to be

rented to an assisted family by the total

number of bedrooms available. So, for

a family with a housing voucher that is

entitled to occupy three bedrooms in a

five-bedroom unit, their pro-rata share of

rent used for calculating their payments

would be three-fifths.

The Housing Choice Voucher Program

Guidebook provides guidelines for

PHAs in calculating rent for program

participants to live in SROs, group

housing, shared housing, and other

special housing types.

For shared

housing, the guidebook states that the

payment standard for a family in shared

housing is the lower of the payment

standard for the family unit size or the

pro-rata share of the payment standard

for the shared housing unit size. An

example from the guidebook (in the next

column) helps explain this further.

Similar calculations are used in SROs,

group houses, and other special housing

types. In these special types of housing

arrangements, program participants

receive less subsidy than in traditional

assisted housing units.

xiv

Furthermore, in a 2021 Notice from

HUD’s Office of Public and Indian

Housing (PIH), HUD reiterated to PHAs

administering HCV programs that shared

housing is an allowable option for

assisted families considering their housing

xiv

He et al. (2010) show that living alone is more expensive than living with someone else and deduce that the per-person cost of maintaining a standard of living is

considerably lower with two people living together compared to one person living alone. The authors argue, however, that current housing voucher policies could be

discouraging the use of shared housing living arrangements. As mentioned earlier in this paper, the authors investigated negative effects of shared housing that might

explain why housing policies discourage shared housing but did not find anything to this effect. See He, O’Flaherty, and Rosenheck (2010).

options. The notice enumerates the

various models of shared housing offered

across U.S. rental housing markets and

the requirements needed for using HCVs

in shared housing. The models include

private for-profit co-living housing (such

as a boarding house or any arrangement

renting a single bedroom with a common

living room, kitchen, and dining room);

for-profit shared housing organizations

(including online sites that match

roommates into single-family homes and

charge a fee for service); and nonprofit

shared housing matching services.

State and Local Initiatives on

Shared Housing

Several U.S. states and municipalities

have launched shared housing initiatives

and pilot programs to provide additional

affordable housing. The following section

highlights initiatives found in New York,

Pennsylvania, and Massachusetts. These

initiatives bring together developers,

shared housing organizations, and local

housing agencies to develop new housing

or to convert existing housing stock for

use as shared housing. The initiatives

vary in scope: some are targeted toward

recently homeless populations, whereas

others are home sharing programs

marketed to seniors, and others are co-

living developments with rents ranging

in affordability from market-rate to

extremely low-income.

New York

In New York City, the Department of

Housing Preservation and Development

(HPD) began the ShareNYC initiative in

2018.

The goal of the pilot program

was to create or preserve 300 affordable

housing units in the Brooklyn and

Manhattan boroughs through a

competitive Request for Information

(RFI) and Expressions of Interest (RFEI)

process for soliciting proposals. Co-living

corporations like Common and PadSplit

partnered with developers and submitted

proposals for co-living developments

under the ShareNYC initiative.

ShareNYC is a flexible and innovative

initiative under New York City’s

Affordable Housing 2.0 agenda, with

a goal to create and preserve 300,000

affordable homes in New York City by

2026. Three proposals for three different

sites were selected for the pilot initiative:

two in the East Harlem neighborhood of

Manhattan, and one in the Cypress Hills

neighborhood of Brooklyn. Each site

uses different developers and co-living

organizations.

The projects selected by

ShareNYC show the range of housing

users that could benefit from shared

housing options, from formerly homeless

individuals with service needs to a mixed-

income community. The selected projects

also demonstrate the range of shared

housing designs that can be pursued to

accommodate the needs and preferences

of different types of shared housing users.

Pennsylvania

In November 2019, the City of

Philadelphia’s Office of Homeless

Co-living Developments under the ShareNYC Initiative

Example:

Household includes mother and

8-year-old daughter

Bedrooms available to assisted

family: 2

Total bedrooms in the unit: 3

2 Bedrooms for assisted family

÷ 3 Bedrooms in the unit

.667 pro-rata share

2 BR payment standard: $400

3 BR payment standard: $565

$565 x .667 (pro-rata share) = $377

$377 is lower than the $400

payment standard for the 2 BR

family unit size

Services and the Department of

Behavioral Health and Intellectual

disAbility Services published a request

for proposals to operate their shared

housing pilot program called Share

Place.

Share Place represents a subset

of the Philadelphia Housing Authority’s

(PHA) initiative to house individuals

at risk of homelessness. In addition

to providing multifamily housing for

students at the Community College of

Philadelphia who were formerly in foster

care, and 10 units to house families,

18 three- and four-bedroom units were

dedicated specifically to house around 50

unrelated homeless adults.

The program requires the PHA to

rehabilitate the buildings to HUD

housing quality standards and for

a nonprofit entity or partnership to

operate the program once the buildings

are occupied.

The responsibilities are

split between property management

and service coordination. The service

coordinator has 24/7 on-call capacity and

coordinates tenant services and handles

the matching process (conducting

interviews, screening participants,

and mediating conflict). The property

manager is the master lease holder and

oversees intake, subleases, and rent

payments, which are not to exceed 30

percent of participant income. Eligible

participants are those who have a history

of homelessness, earn income, and aspire

to be a good housemate. Participants

are required to work with an external

case manager for at least 1 year. The

city specifically emphasizes choice

and control as essential components

of Share Place, whereby participants

choose whom to live with and develop

mutually supported house rules through

a formal agreement. The initiative aims to

prevent and end homelessness and was

created to provide an affordable housing

option for individuals leaving shelters,

recovery houses, or other temporary

living arrangements. The city justifies the

program by highlighting its potential to

reduce individual isolation and returns

to homelessness, incarceration, and use

of crisis services, and also to promote

community-building.

The State of Pennsylvania’s Department

of Aging began the Shared Housing and

Resource Exchange (SHARE) housing

initiative in 2017.

Funding for the

initiative came federally from a “Money

Follows the Person” demonstration

grant from the Centers for Medicare and

Medicaid Services. The pilot program

was launched in the counties of Monroe,

Pike, and Wayne. It was created to help

senior homeowners aged 60 and up to

age in place by matching them with an

adult seeking affordable housing. The

program operates like a home sharing

program where tenants have their own

bedrooms and provide companionship

and services in exchange for low rent.

Rent averages around $350 per month,

in addition to the companionship and

services requested.

Co-living Developments under the ShareNYC Initiative

Ali Fourney Center & Ascendant

Neighborhood Development

L+M Development

Partners & Common

Cypress Hills Local Development

Corporation & PadSplit

• Neighborhood: East Harlem,

Manhattan

• Units: 36

• Target population: Homeless

LGBT youth

• Design: New 10-story building of four

shared duplex units and one shared

simplex unit. Fully furnished and with

utility costs packaged into rent, with

green roof and cooling, and onsite

social services

• Neighborhood: East Harlem,

Manhattan

• Units: 56

• Target population: Mixed income:

one-third market rate, two-thirds from

very low-income to moderate-income

• Design: Two eight-story buildings with

each wing designed under a different

typology, with variation in sizes of

common spaces and distribution of

private and shared bathrooms

• Neighborhood: Cypress Hills,

Brooklyn

• Units: 11

• Target population: Retention of existing

tenants, who range from extremely low-

income to low-income tenants

• Design: Rehab of existing two-story SRO

building to create spacious common

areas, fully furnished units, and

expanded outdoor recreational space,

with utility costs packaged into rent

The ShareNYC initiative shows the range of

individuals that can benefit from shared housing

options, from formerly homeless individuals

with service needs to a mixed-income

community, and the array of shared housing

designs that can be pursued to meet the needs

and preferences of different types of individuals.

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The Wayne County Area Agency on

Aging coordinates the SHARE Housing

Initiative through a typical home sharing

model. The agency handles applications,

interviews, and background checks for all

participants. The agency interviews home

providers, inspects the housing units, and

introduces prospective matches. After a

trial period, the participants enter a home

sharing agreement. The agency follows

up with matches and mediates in case

of conflict. Since 2017, the program has

made 32 matches.

Massachusetts

In 2017, the City of Boston created

the Intergenerational Homeshare

Pilot program.

The program was

a collaboration between the city’s

Age Strong Commission, the city’s

Housing Innovation Lab, and Nesterly,

a shared housing entity specializing

in intergenerational housing in the

Boston metropolitan area. The program

matched senior homeowners with a

spare bedroom with students in search

of affordable housing. The pilot program

was conducted over a short period in

2017 and quickly drew interest, receiving

more than 80 applications in 3 weeks.

The pilot program created eight home

share matches during the period. The

average rent paid by tenants was $700,

with some tenants paying less in exchange

for providing services. Following the

home share model, Nesterly handles the

application process, conducts background

checks, and facilitates matches. Nesterly

also handles rent payment, which is set

up online through their website.

The Intergenerational Homeshare Pilot

program came about after the city

released a 2014 report on housing in

the city called “Housing a Changing

There are many shared housing organizations internationally, and these organizations operate similarly to those in the United States, where, after an application

and vetting process by the matchmaking organizations, a renter is matched to a homeowner at a reduced rent in exchange for services. Similar to the National Shared

Housing Resource Center in the United States, there are home sharing networks in other countries. For example, in the United Kingdom, Homeshare UK operates as a

network for home sharing organizations. The network includes information on more than 20 home sharing providers across the United Kingdom.

International home sharing models, particularly those in Europe, can take on many forms. Most examples of shared housing in Europe focus on multigenerational

housing by matching students seeking housing to senior homeowners with an available room. Students pay a reduced rent or a reduced rent and services to the senior

homeowner in exchange for a room. The arrangement helps reduce the housing needs of students and reduce the need for developing additional student housing. Other

shared housing arrangements are centered around community and independent living. The prevalence and types of shared housing programs that are present in other

countries are influenced by sociocultural and historical factors around the types of living arrangements that groups and individuals are comfortable navigating.

City: Boston 2030.” The report found

that senior citizens are the fastest

growing demographic in the Boston

area and make up the largest percent of

homeowners. The report also estimated

the availability of more than 38,000

spare bedrooms in senior citizen homes

in Boston. After an evaluation of the

pilot proved its value, in 2019, the city

operationalized the program citywide,

with the aim of matching 100 older

adults with spare rooms to people in

need of a room by June 2020.

Boston’s

home sharing program, launched based

on evidence of the prevalence of senior

homeowners and their spare bedrooms,

demonstrates the data-driven justification

to expand shared housing opportunities

in a high-demand city.

Boston’s home

sharing program,

launched based

on evidence of the

prevalence of senior

homeowners and

their spare bedrooms,

demonstrates the data-

driven justification to

expand shared housing

opportunities in a high-

demand city.

HUD International Research

Partnerships on Shared Housing

HUD has several international research

partnerships that focus on shared

housing. Two mentioned here are a

grant to study multigenerational housing

in Germany and a memorandum of

cooperation regarding aging in place

strategies with the Japan Ministry of

Land, Infrastructure, Transport, and

Tourism. HUD collaborates with experts

in both countries to understand best

practices for shared housing models in

their particular contexts.

German Marshall Fund Grant to

Study Multigenerational Housing

in Germany

HUD provides funding through a grant

to the German Marshall Fund (GMF) to

study Germany’s “Wohnen für (Mehr)

Generationen” (Living with Multiple

Generations) program. Through GMF’s

Urban and Regional Policy Program and

in partnership with Harvard University’s

Joint Center for Housing Studies, GMF

researchers will report on this federally

subsidized program of private-public

partnerships, which began in the

2000s and comprises 30 multifamily

housing projects. The researchers seek

to understand the details of the model

and the program’s applicability to

housing models in the United States. The

researchers began their study in September

2019 and will conclude in March 2021.

The benefits of multigenerational

housing are similar to those of

shared housing: the ability for senior

homeowners to age in place and the

increase in the availability of affordable

housing for individuals. Indeed, many

countries face similar challenges to the

American issues of housing affordability

and an aging population.

Aging

populations require more care, and the

large aging baby-boomer generation

creates additional demand. (See the

appendix for information on Shared

Housing for the Elderly.) In the United

Kingdom and elsewhere, there is more

demand for care than can be provided

under traditional social services, and

so alternative solutions, such as the

multigenerational housing program in

Germany, are being considered.

Many countries face

similar challenges

to the American

issues of housing

affordability and an

aging population.

Memorandum of Cooperation

between HUD and the Japan

Ministry of Land, Infrastructure,

Transport and Tourism

In 2017, HUD signed a memorandum

of cooperation (MOC) with the Japan

Ministry of Land, Infrastructure,

Transport and Tourism (MLIT) that

focuses on aging in place among senior

populations in both countries.

100

Both

the United States and Japan are facing

housing challenges associated with

the demographic shift of an aging

population. (See the appendix for

information on Shared Housing for the

Elderly.) In Japan, 28 percent of the

population is 65 or older, and the birth

rate is at a record low. In the United

States, 16 percent of the population is

65 or older and the birth rate is also

at a record low. The MOC focuses on

research on policies and practices of

aging in place in both countries.

Through the partnership, HUD and

MLIT have exchanged research and

evaluation on the topic of aging in

place; provided briefings on housing

conditions facing seniors, including

policies on housing for seniors; and

visited sites in each country to see

how and why these housing models

are implemented. The partnership

provides both countries with valuable

information on best practices for aging

in place.

Japan’s Urban Renaissance Agency

has a robust partnership with Chubu

University located in Nagoya. For

example, the Kozoji New Town Housing

Project in Nagoya is partnered with

Chubu University to provide housing

for students in exchange for students

volunteering to assist senior residents.

The students receive a 20-percent

discount on their own housing unit

within the Kozoji New Town Housing

Project in exchange for a minimum of

40 hours of volunteer work per year

with seniors. This unique partnership

increases multi-generational interactions

with isolated senior individuals while

providing companionship and assistance.

Conclusion

Shared housing in the United

States, starting with single-room

occupancy housing during urban

industrialization, has a rich history

in providing affordable housing in

high-cost, high-opportunity areas.

Indeed, as presented in this report,

shared housing can benefit households,

particularly those facing economic

insecurity, with viable and affordable

housing options. Sharing housing can

also have significant social and health-

related benefits through its lessening

of social isolation and loneliness,

two of the greatest health risks to

Americans. This finding is especially

true for senior individuals who prefer

to age in place, a population that will

increase in size during the next decade

as baby boomers age into retirement.

As highlighted in this report, more

Americans that share housing do so

informally, as can be seen through

changes in the number of families

per household, the types of families

in households, and multigenerational

housing. Two of the primary formal

methods of shared housing in the United

States are home sharing and co-living,

which are operationalized through both

for-profit and nonprofit models. At the

federal level, shared housing is also an

allowable type of assisted housing in

HUD’s HCV program. Various state and

municipal initiatives also use shared

housing models to expand affordable

housing opportunities to households;

these opportunities are often targeted

to certain populations, including senior

residents who are aging in place and

formerly homeless residents who need

supportive services and supportive

communities. Further, shared housing

can be a viable affordable housing option

as locales across the United States reform

land-uses and building allowances—

ranging from higher occupancy limits

to building allowances for accessory

dwelling units—that result in greater

regulatory flexibilities and increased

housing supply. Overall, shared housing

is an affordable housing arrangement in

the United States that allows for a more

efficient use of available housing stock

and uses of future housing development

and can be a particularly effective way to

expand affordable housing options for

American households of various ages and

income levels.

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Appendix A: Shared Housing for Seniors

xvi

Several measures indicate that, not only is the United States population aging, it is also becoming more segregated by age. According to Joint Center for Housing

Studies study, using the American Housing Survey (2017), one-third of households with a person age 55 or older live in communities that are age-restricted or where

the majority of neighbors are 55 or older.

Shared housing can particularly benefit

senior populations by allowing them to

reduce their housing costs and age in

place. Research indicates that seniors

prefer to age in place, in familiar home

settings, rather than move to assisted

living centers or other retirement

communities.

101

102

Not every senior

homeowner can age in place alone,

however; the physical and financial

demands of maintaining a home

can become too difficult for some

senior homeowners. Shared housing

options—including home sharing,

multigenerational housing, and naturally

occurring retirement communities

(NORCs)—can alleviate some of the

financial and physical demands of

homeownership. Shared housing is also

being pursued for senior households in

HUD-assisted housing.

Growth in Senior Households and Aging in Place

Population projections for the United

States indicate that by 2030, for the first

time in U.S. history, more Americans will

be age 65 and older than children under

the age of 18.

103

By 2034, a projected 77

million Americans will be age 65 and

older, roughly one in five Americans. This

trend, due to the aging of baby boomers

into retirement, demonstrates that

housing for seniors will play an important

role in the overall housing landscape in

the coming decade.

Most senior Americans live in traditional

types of housing. Among adults aged 65

and older receiving Medicare, 93 percent

live in traditional communities, whereas

only 3 percent live in community

housing with services and 4 percent

live in long-term care facilities.

104

These

demographics place more emphasis

on senior-only housing. Studies show

that seniors prefer to age in their own

homes in environments with which

they are familiar and have a sense of

ownership, and that the likelihood of

moving decreases with age.

105

So, as the

population ages, aging in place is an

increasing priority in senior housing.

Trends in homeownership show that

recently retiring generations have higher

homeownership rates than their cohorts

before them.

106

These trends indicate

that older homeowners are shifting

their preferences and holding onto their

homes for longer periods to age in place.

The needs of the growing movement to

age in place can pair well with shared

housing arrangements.

A 2018 study by the Joint Center for

Housing Studies on changes in housing

tenure looked at the housing tenure

transitions of adults age 50 and older.

xvi

The

author analyzed data from the Panel Study

of Income Dynamics (PSID) and found

variance in housing tenure among this

Figure 9. Historical Homeownership Rates for Household Heads Age 67 to 85

Source: Freddie Mac, www.freddiemac.com/fmac-resources/research/pdf/201901-Insight-02.pdf

Homeownership Rate (percent)

Age

67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85

Good Times Cohort (1931-1941) Previous Generations (≤1930)

demographic, specifically, that 62 percent of

adults age 50 and older always owned their

home during this period, whereas 4 percent

always rented during the same period. The

xvii

Why would seniors facing housing affordability issues choose to share their home with new renters instead of taking out a reverse mortgage through a home equity conversion

mortgage (HECM) loan? HECMs may not be beneficial for everyone. They tend to pay off for homeowners who plan to remain in their home for years; a household that is

not planning on remaining in place might prefer an alternative that does not require a long-term commitment. HECMs can be useful for seniors facing financial shocks, like

new health costs, who need an injection of cash, but if this is not necessary, receiving rent from a tenant could be sufficient. Some homeowners may determine HECMs to be a

useful financial product where there is depreciation or price uncertainty in the market because the loan is locked in regardless of changes to the home value. If prices are rising,

renting could be the better option because what is received from the renter would keep pace with market growth. These macroeconomic factors play an additional role on top of

personal behavioral factors in influencing a person’s decision to engage in home sharing or co-living as opposed to other solutions to deal with housing unaffordability.

remaining 34 percent of adults 50 years

of age or older in the study’s sample frame

experienced housing tenure transitions

of some combination of owning and

renting during this period, which shows

that housing tenure among older adults is

dynamic, with more transitions than may

be more widely assumed.

Home Sharing

Senior homeowners who can live

independently yet may find day-to-day

tasks more difficult, or who could use

extra income, could benefit from home

sharing, a sub-type of shared housing.

Home sharing is when a homeowner

rents out a spare bedroom to another

adult but shares common areas like

kitchens and living rooms. With home

sharing, homeowners can reduce their

housing costs with the additional

income received from rent and,

depending on the specifics of the home

share arrangement, receive services

in addition to rent. Home sharing

is beneficial for senior homeowners

whose financial or physical abilities

have recently changed, such as senior

homeowners who have experienced a

reduction in income from retirement,

the death of a spouse, or unexpected

medical expenses; home sharing may

also benefit senior homeowners with

reduced physical abilities.

xvii

Figure 10. Annual Homeownership Rates for the United States by Age Group: 1982–2019

Percent

65 and over 55-64 45-54 United States 35-44 Under 35

1982 ‘85 ‘90 ‘95 2000 ‘05 ‘10 ‘15 2019

Recession

Source: U.S. Census Bureau, https://www.census.gov/housing/hvs/data/charts/fig07.pdf

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U.S. Department of Housing and Urban Development | Ofﬁce of Policy Development and Research

In some home sharing arrangements,

senior homeowners can receive services

from the renter, including help with

housework, yardwork, pet care, and

errands. These additional services are a

benefit to the day-to-day living of senior

xviii

In a 1990 study on senior homeowners’ interest in home sharing and accessory dwelling units, David Varady examined why senior homeowners were or were

not interested in home sharing or accessory dwelling units (ADUs). Through phone interviews, Varady found that need rather than capacity was the main reason

homeowners were interested in home sharing or ADU conversion. Homeowners who had low income, outstanding debts, or were in poor health or physical condition

indicated the greatest interest for home sharing and ADUs. Those residents interested in shared housing and ADU conversion, however, often lacked the physical or

financial capacity to begin home sharing or to build an ADU.

xix

HUD offers financing tools that can be used for ADU development or conversion, including the 203(k) renovation loan insured by the Federal Housing Administration and

the HomeStyle loan guaranteed by the Federal National Mortgage Association (Fannie Mae), a government-sponsored enterprise regulated by the Federal Housing Finance

Agency.

Generally, the FHA-insured 203(k) loan is more lenient about the borrower’s credit and stricter about the types of renovations that are eligible, whereas the HomeStyle

mortgage guaranteed by Fannie Mae is stricter about the borrower’s credit and more lenient about the types of renovations that are eligible. These loans offer some simplicity

because they combine the home and ADU under the same mortgage, rather than packaging the ADU renovation under a separate loan requiring its own set of processes.

homeowners. When home sharing

arrangements are set up by home sharing

organizations, they inquire what type

of payment the homeowner would

like to receive, whether only rent or a

combination of rent and services.

Although evidence from home tenure data

suggests that many seniors prefer to age in

place, not all who want to are able to do

so. Aging in place can require investment

in home modification that may be difficult

for some homeowners.

xviii

xix

Naturally Occurring Retirement Communities

A NORC is a building or neighborhood

where there are a substantial number of

residents age 60 years or older. These

areas can be defined as a neighborhood,

apartment building, or housing complex

that was not originally intended to

house seniors. Early research on NORCs

defined them as housing developments

not purposely built for seniors, in which

more than one-half of the residents are

age 60 or older.

107

Other research and

jurisdictions define NORCs similarly but

with different parameters around age and

the proportion of residents above that age.

NORCs may also provide support

services for senior residents. NORCs

can be managed by nonprofit

organizations that partner with

community healthcare providers

and social service organizations to

provide on-site services based on

the needs of the community. NORC

services promote independent

living, improve the quality of

life for residents, reduce the use

of emergency care, and slow the

transition to assisted living and

nursing care facilities.

In New York, Elder Law Section 209

defines a NORC as an apartment

building or housing complex that

was not predominantly built for

older adults (age 60 and older);

that does not restrict admissions

solely to older adults; where at least

40 percent of the units have an

occupant who is an older adult, and

at least 250 residents of a building

(or 500 residents of a housing

complex) are older adults; and

where a majority of the older adults

are low or moderate income.

Supportive Services in HUD-Assisted Housing

In recognition of the role of supportive

services in aging in place, HUD

provided funding for research on

supportive services for low-income

senior residents of HUD-assisted

housing. The HUD Supportive Services

Demonstration (SSD), also known as

the Integrated Wellness in Supportive

Housing (IWISH), aims to promote

Hamilton-Madison House (New York, NY)

Many NORCs are found in New York City; one example is the Hamilton-Madison House in the Lower East Side neighborhood.

The Hamilton-Madison House, a nonprofit settlement house established in 1898, manages the Alfred E. Smith Senior Services

NORC and the Knickerbocker Village Senior Center NORC. The Hamilton-Madison House provides services to the local

community, including programs for senior residents in New York City, such as daily meals, indoor and outdoor social activities,

enrichment classes, and holiday events. The Hamilton-Madison House partners with other community organizations to provide

special programs for seniors. The Hamilton-Madison House receives the majority of its funding publicly through agencies in the

city and state, whereas a lesser amount comes from private donors.

Source: Hamilton-Madison House, http://www.hamiltonmadisonhouse.org/

and prolong aging in place for senior

residents in HUD-assisted housing. The

SSD

xxi

provides funding for a part-time

wellness nurse and a full-time resident

wellness director, whose role is to

implement a strategy for coordinating

services. Among their responsibilities,

they assess resident needs and interests;

develop Individual Health Aging

Plans (IHAP); engage with community

partners for resources and services;

engage with building management and

maintenance to promote well-being;

and work collaboratively to coordinate

support services.

As of 2020, the 3-year demonstration

is currently being implemented in

xxi

The demonstration was started in October 2017 and ends in September 2020. The SSD evaluation is expected to be completed in 2022.

HUD-assisted multifamily properties

in California, Illinois, Maryland,

Massachusetts, Michigan, New Jersey,

and South Carolina that predominantly

or exclusively serve households headed

by people age 62 and older. HUD has

included a thorough evaluation as

part of the SSD to produce evidence

for Congress and stakeholders about

the impact of the demonstration. The

HUD-assisted properties that are part

of the demonstration were randomly

assigned to one of three groups: a

treatment group of 40 properties that

received grant funding to hire a resident

wellness director and a wellness nurse

and implement the SSD model; an

active control group of 40 properties

that did not receive grant funding but

received a stipend to participate in the

evaluation; and a passive control group

of 44 properties that received neither

grant funding nor a stipend. The random

assignment permits an evaluation that

quantifies the impact of the SSD model

by comparing outcomes at the 40

treatment group properties to outcomes

at the 84 properties in the active and

passive control groups. Results from the

evaluation will demonstrate to HUD and

housing researchers whether this specific

model of shared housing for senior

residents, that is, the co-residency of

senior households and a wellness director

in the same multifamily building, leads to

better health outcomes for residents.

Insights into Housing and Community Development Policy

U.S. Department of Housing and Urban Development | Ofﬁce of Policy Development and Research

Endnotes

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Hemmens, George C., Charles J. Hoch, and Jana Carp, eds. 1996. Under One Roof: Issues and Innovations in Shared Housing, Albany, NY: SUNY Press.

Beckett, Katherine, and Steve Herbert. 2009. Banished: The New Social Control in Urban America. Bethesda, MD: Oxford University Press

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Randall, Frank A. 1999. History of the Development of Building Construction in Chicago. Chicago, IL: University of Illinois Press.

Friedman, Donald. 2010. Historical Building Construction: Design, Materials, and Technology. New York: WW Norton & Company.

Sherman, Max H. 2003. “ASHRAE and Residential Ventilation,” ASHRAE Journal 46: 1–12.

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Ibid.

Kidman, Angus. 2017. “How America’s Spare Bedrooms Could Be Worth $174.9 Billion.” New York: Finder.

https://www.finder.com/rent-spare-bedroom.

Simmons, Cameron. 2017. “Boom-mates: How Empty Nesters Could Help Ease a Housing Shortage.” San Francisco, CA: Trulia.

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Ibid.

Choi, Jung Hyun, Laurie Goodman, Jun Zhu, and John Walsh. 2019. “Senior Housing and Mobility: Recent Trends and Implications for the Hous-

ing Market.” Washington, DC: Urban Institute. https://www.urban.org/sites/default/files/publication/100953/senior_housing_and_mobility.pdf.

Ibid.

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https://www.pewresearch.org/fact-tank/2018/04/05/a-record-64-million-americans-live-in-multigenerational-households/.

Phone interview with HomeShare Vermont conducted on June 25, 2019.

National Shared Housing Resource Center. https://nationalsharedhousing.org/.

Phone interview with Affordable Living for the Aging conducted on June 18, 2019.

Ibid.

Phone interview with HomeShare Vermont conducted on June 25, 2019.

Phone interview with HIP Housing conducted on June 17, 2019.

Phone interview with Affordable Living for the Aging conducted on June 18, 2019.

Phone interview with HIP Housing conducted on June 17, 2019.

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https://www.curbed.com/2019/9/17/20869266/common-coliving-apartment-real-estate-expansion.

Ibid.

U.S. Department of Housing and Urban Development (HUD). 2019. “Coliving: A Nontraditional Affordable Housing Option,” The Edge.

https://www.huduser.gov/portal/pdredge/pdr-edge-featd-article-042919.html.

Insights into Housing and Community Development Policy

U.S. Department of Housing and Urban Development | Ofﬁce of Policy Development and Research

Phone interview with PadSplit conducted on January 24, 2020.

Ibid.

Phone interview with HIP Housing conducted on June 17, 2019.

Phone interview with Affordable Living for the Aging conducted on June 18, 2019.

Phone interview with HomeShare Vermont conducted on June 25, 2019.

Ibid.

Phone interview with HIP Housing conducted on June 17, 2019.

Phone interview with Affordable Living for the Aging conducted on June 18, 2019.

Phone interview with PadSplit on January 24, 2020.

Parker, Will, and David Jeans. 2019. “Squeezing Profits from Shared Housing” The Real Deal. April 1. https://therealdeal.com/issues_articles/co-

living-in-new-york.

Ibid.

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bridge, MA: Harvard. https://scholar.harvard.edu/glaeser/files/why_is_manhattan_so_expensive_regulation_and_the_rise_in_house_prices.pdf.

HUD. 2018. “Regulatory Barriers and Affordable Housing: Problems and Solutions.” Evidence Matters. Washington, DC: Office of Policy Develop-

ment and Research, Department of Housing and Urban Development. https://www.huduser.gov/portal/periodicals/em/spring18/highlight1.html.

Phone interview with AARP conducted on October 10, 2019.

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Stein, Perry. 2015. “How Many People Can You Cram into a D.C. Group House?” Washington Post. March 11, 2015.

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and Urban Development. https://www.huduser.gov/portal/pdredge/pdr-edge-frm-asst-sec-040119.html.

Hsieh, Chang-Tai, and Enrico Moretti. 2019. “Housing Constraints and Spatial Misallocation,” American Economic Journal: Macroeconomics 2019 11

(2): 1–39. https://doi.org/10.1257/mac.20170388.

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Department of Housing and Urban Development. https://www.huduser.gov/portal/sites/default/files/pdf/Alternative-Housing-Arrangements.pdf

Spevak, Eli, and Melissa Stanton. 2019. “The ABCs of ADUs: A Guide to Accessory Dwelling Units and How They Expand Housing Options for

People of All Ages. Washington, DC: AARP. https://www.aarp.org/content/dam/aarp/livable-communities/livable-documents/documents-2019/ADU-

guide-web-singles-071619.pdf.

Coppage, Jonathan. 2017. “Accessory Dwelling Units: A Flexible Free-Market Housing Solution.” Washington, DC: R Street Institute.

http://www.rstreet.org/wp-content/uploads/2017/03/89.pdf.

HUD. 2018. “States Reduced Regulatory Barriers for Affordable Housing.” Evidence Matters. Washington, DC: Office of Policy Development and

Research, Department of Housing and Urban Development. https://www.huduser.gov/portal/periodicals/em/spring18/highlight3.html.

Garcia, David. 2017. “ADU Update: Early Lessons and Impacts of California’s State and Local Policy Changes.” Berkeley, CA: University of Califor-

nia Berkeley. http://ternercenter.berkeley.edu/uploads/ADU_Update_Brief_December_2017_.pdf.

Chapple, Garcia, Valchuis, and Tucker. 2020. “Reaching California’s ADU Potential: Progress to Date and the Need for ADU Finance” Berkeley.

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Brief-2020.pdf.

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HUD. 2018. “Proposals to Update the Fair Market Rent Formula.” Washington, DC: Office of Policy Development and Research, Department of

Housing and Urban Development. https://www.huduser.gov/portal/sites/default/files/pdf/Proposals-To-Update-the-Fair-Market-Rent-Formula.pdf.

HUD. 2020. “Housing Choice Voucher Program Guidebook.” Washington, DC: U.S. Department of Housing and Urban Development.

https://www.hud.gov/sites/dfiles/PIH/documents/Special_Housing_Types_final_5.2020.pdf.

New York City Department of Housing Preservation and Development. October 8, 2019. City Reveals Selected Shared Housing Development Pro-

posals [Press Release]. https://www1.nyc.gov/site/hpd/news/092-19/city-reveals-selected-shared-housing-development-proposals#/0.

Ibid.

Request for Proposals to Operate Share Place, a New Shared Housing Pilot. The City of Philadelphia. November 2019.

https://www.phila.gov/media/20191127111324/Share-Place-RFP-Final.pdf.

Ibid.

Pennsylvania Department of Aging. 2019. “SHARE: Shared Housing and Resource Exchange.” Philadelphia, PA: Pennsylvania Department of

Aging. https://www.aging.pa.gov/organization/PennsylvaniaLongTermCareCouncil/Documents/2019_10_24%20Mtng%20Materials/SHARE%20-%20

Shared%20Housing%20Resource%20Exchange%20-%20Pilot%20Program%20Presentation.pdf

Ibid.

City Launches Intergenerational Homeshare Pilot Program. September 2017. City of Boston. https://www.boston.gov/news/city-launches-intergen-

erational-homeshare-pilot-program.

Daniel, Seth. 2019. “City Looking to Significantly Expand Intergenerational Home-Share in 2020.” Charlestown Patriot-Bridge. November 27, 2019.

https://charlestownbridge.com/2019/11/27/city-looking-to-significantly-expand-intergenerational-home-share-in-2020/.

McNeil & Hunter (2014).

100

HUD. 2017. “The U.S. and Japan Partner to Research Aging in Place.” The Edge. Washington, DC: Office of Policy Development and Research,

Department of Housing and Urban Development. https://www.huduser.gov/portal/pdredge/pdr-edge-trending-040317.html.

101

HUD. 2013. “Aging in Place: Facilitating Choice and Independence.” Evidence Matters. Washington, DC: Office of Policy Development and Re-

search, Department of Housing and Urban Development. https://www.huduser.gov/portal/periodicals/em/fall13/highlight1.html.

102

Choi, Goodman, Zhu, and Walsh. 2019. “Senior Housing and Mobility: Recent Trends and Implications for the Housing Market.” Washington,

DC: Urban Institute. https://www.urban.org/sites/default/files/publication/100953/senior_housing_and_mobility.pdf.

103

U.S. Census Bureau. March 13, 2018. Older People Projected to Outnumber Children for First Time in U.S. History. Release Number CB18-41.

https://www.census.gov/newsroom/press-releases/2018/cb18-41-population-projections.html.

104

Federal Interagency Forum on Aging Related Statistics. 2016. “Older Americans 2016: Key Indicators of Well-Being.” Washington, DC: Federal

Interagency Forum on Aging Related Statistics. https://agingstats.gov/docs/LatestReport/Older-Americans-2016-Key-Indicators-of-WellBeing.pdf.

105

AARP. 2018. “2018 Home and Community Preferences Survey: A National Survey of Adults Age 18-Plus.” Washington, DC: AARP. https://www.

aarp.org/content/dam/aarp/research/surveys_statistics/liv-com/2018/home-community-preferences-survey.doi.10.26419-2Fres.00231.001.pdf.

106

Freddie Mac. 2019. “While Seniors Age in Place, Millennials Wait Longer and May Pay More for their First Homes. Economic & Housing Re-

search Insight.” Freddie Mac. http://www.freddiemac.com/fmac-resources/research/pdf/201901-Insight-02.pdf.

107

U.S. Department of Health and Human Services. 2004. Supportive Services Programs in Naturally Occurring Retirement Communities. What is a

NORC? Washington, DC: Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services.

https://aspe.hhs.gov/report/supportive-services-programs-naturally-occurring-retirement-communities/what-norc

Insights

HUD Office of Policy Development and Research

Ben J. Winter, Deputy Assistant Secretary for Policy Development

Heidi Joseph, Director, Research Utilization Division

Sean Martin, Author, Social Science Analyst, Office of Policy Development and Research

Janet Li, Author, Economist, Office of Policy Development and Research

Insights

Into Housing and Community

Development Policy

U.S. Department of Housing and Urban Development | Ofce of Policy Development and Research

June 2021