Co-Living Is On The Rise As Older Adults Search For Affordable Housing

Amid America’s growing housing crisis, housing advocates are fighting to make better use of the empty bedrooms already available across the country.

Skyrocketing rents and the rising cost of living are pushing more adults to turn to co-living, an affordable housing option also known as house-sharing, room rentals, or “adult dorm rooms.” According to a report published by Zillow, the number of households sharing space with nonrelatives grew by more than 500,000 between 2017 and 2022. Meanwhile, nearly half of U.S. renter households were cost-burdened in 2024, spending more than 30% of their income on housing, according to Harvard University’s Joint Center for Housing Studies. Zillow also identified roughly 21 million “empty nest” households in 2022 — older households without children that have at least two extra bedrooms. That mismatch is creating an opening for companies that can turn underused residential space into rental units.

Launched in 2017, PadSplit lets property owners rent individual furnished bedrooms in single-family homes by the week. PadSplit gives renters access to a private bedroom and shared amenities, often with utilities included, while property owners can generate rental income from multiple rooms instead of leasing an entire property to one household. It mostly targets workers who earn too much to qualify for government subsidies but struggle to afford a conventional apartment. The company says it has housed more than 70,000 people in rooms that are substantially cheaper than a traditional apartment in the 30 markets where it operates.

The concept is essentially a modern version of single-room occupancy, or SRO housing, which was once common in American cities before zoning restrictions and redevelopment policies helped push the model out of the mainstream after World War II. Now legislators are reconsidering those restrictions.

In Rhode Island, lawmakers introduced the ROOM Act, legislation designed to remove barriers to co-living and SRO housing in zoning ordinances, building codes, and occupancy rules, reports Vox. The Institute for Justice, which developed the legislation, says it could apply to everything from a homeowner renting a spare bedroom to larger co-living properties created from converted commercial buildings.

Pennsylvania is also examining roommate restrictions. A 2026 analysis from the Pacific Legal Foundation found that nine of the state’s 10 largest cities limit how many unrelated adults can live together, potentially leaving existing bedrooms unavailable to renters.

In Shawnee, Kansas, property-management company HomeRoom challenged a city ordinance limiting unrelated adults from living together. A federal judge dismissed the constitutional challenge, citing a 1974 Supreme Court precedent.

The debate is about more than roommates. It is about whether America can expand its rental supply by monetizing space that already exists. As Sam Hooper of the Institute for Justice told Vox, “I think there’s this real problem of letting the perfect be the enemy of the good in housing policy.”

Co-living is on the rise as housing costs keep squeezing renters. And with millions of bedrooms potentially sitting underused, it could become even more popular.

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