Co-living investment in Australia:
what nobody tells you before you start.
“I once had to make a very delicate phone call to a tenant about toilet paper usage. 🧻 Not my strangest Tuesday, but close. This is co-living management. Not every conversation is about rent and leases. Some of them are about toilet paper.”
Daria Tedling, co-living property manager
Room-by-room rental, especially on a five or six-bedroom property, can earn significantly more than a standard tenancy on the same property. I manage these properties in Australia and the dynamics are the same across Australia. This is what I wish someone had told me before I started, and what I now tell every landlord who asks whether it is worth it.
Privacy notice: All names in this article are entirely fictional and created for this post. No real names, addresses or identifying details have been used (Privacy Act 1988 Cth). General information only, not legal advice.
Written by
Daria Tedling
Founder, Local Property Partners · REIWA 2025 Residential PM of the Year
I manage co-living and room-by-room properties in Australia and write about the strategy for landlords across Australia. If you are researching whether co-living is right for your property, I am happy to have an honest conversation.
So, is co-living worth it? My honest answer is yes, for the right property and the right landlord. A five or six-bedroom property rented room by room can generate significantly more gross income than the same house on a standard tenancy. I have seen it firsthand with properties I manage.
This is not a theoretical overview. These are real situations from properties I manage. All names used throughout this article are entirely fictional, I have created them specifically to describe these situations while protecting the privacy of everyone involved. The events themselves are accurate. I am writing this because landlords researching co-living deserve to know what the day-to-day actually looks like, and tenants considering shared living deserve to know it can be managed well.
Important: co-living is generally not governed by residential tenancy legislation
This is one of the first things I explain to every landlord. Co-living typically runs under a Lodging Agreement, not a standard residential tenancy. Because occupants do not have exclusive possession of the whole property, residential tenancy legislation generally does not apply. This changes a lot, and mostly in your favour as the landlord. Note that the specific legal position varies by state, so always seek local legal advice.
In practice it means you can move faster when something goes wrong. Three weeks' notice from either side to end the arrangement. Serious breach? You can require someone to vacate within days. Repeated issues? Formal breach notice, then termination. You are not locked into the same drawn-out process as a standard tenancy.
This is one of the most underappreciated features of co-living investment. If a tenant is genuinely making life difficult for others in the house, you have real and timely options. You are not stuck waiting through a protracted SACAT process. Occupants are encouraged to read Consumer Protection WA's guidance: consumerprotection.wa.gov.au/boarders-and-lodgers
The income is real. So is the complexity. The difference between a co-living property that works and one that becomes a constant source of stress is almost always the quality of management.
🧹 Cleaning and shared spaces: whose standard applies?
Cleaning is the big one. In my experience it causes more friction than anything else in a shared house, and it is almost never about someone being deliberately difficult. It is usually just that people have genuinely different standards of clean. What one person considers tidy, another finds unacceptable. And in a shared kitchen, that gap shows up every single day.
One tenant, we will call her Amy (a fictional name), was consistently leaving food particles on the kitchen benchtop and floor after cooking. Other housemates began wearing footwear inside the kitchen rather than walk on the spills. The complaint that came to me was not dramatic, but the frustration was genuine and building.
A separate issue at the same property: the bin was not being emptied regularly. One tenant would always empty it when full. Another never did. Over weeks, this imbalance became a point of resentment that spilled into other interactions.
- Documented the complaint in writing and communicated individually with each party before any group contact
- Proposed three options: a cleaning roster, engagement of a fortnightly professional cleaner (cost split), or a written shared commitment to specific standards
- Issued a formal reminder of house rules with specific reference to the communal areas clause in the occupancy agreement
- Followed up two weeks later to confirm resolution rather than waiting for the next complaint
I hear this sometimes: "I'm already paying a management fee, so why do I need to pay for cleaning on top of that?" Fair question. My answer: if the common areas are dirty or constantly fought about, your tenants leave. And in a co-living property, a tenant leaving is not just one vacancy. It is the trigger that often unsettles the rest of the household.
A single room sitting vacant for four weeks in a co-living property can cost $600 to $900 in lost rent, depending on the room rate. A full changeover, including advertising, screening, a new entry condition report and re-leasing, typically costs several hundred dollars in time and fees on top of that. One lost tenancy costs significantly more than a full year of weekly cleaning.
Tenants stay in co-living properties when the house is a good place to live. They leave when it is not. A clean, well-maintained common area is one of the most basic conditions of that. The weekly clean is not a favour to tenants. It is a protection of the landlord's income.
Why we include a weekly deep clean of common areas, paid for by the owner
At Local Property Partners, a weekly professional deep clean of all common areas is included in every co-living property we manage. The cost is covered by the owner and factored into the weekly room rate. This is not optional. It is a standard part of how we set up and run co-living properties, and it is one of the most effective things we do.
The cleaner covers kitchen benchtops and appliances, bathrooms, living areas and any other shared spaces. There are two conditions: the cleaner will not wash dishes left in the sink, and will not clean if the house is not in a reasonable state of general tidiness beforehand. This is made clear to all tenants at the start of their tenancy. The cleaner cleans the space. The tenants are responsible for keeping their own mess under control.
There are two practical reasons this matters beyond general amenity. The first is hygiene. A co-living house with food residue in shared areas attracts pests. A weekly professional clean breaks the cycle before it starts. The second is that most cleaning disputes arise from cumulative frustration rather than a single incident. When the common areas are reset to a professionally clean standard every week, there is far less for resentment to attach to.
If there are tenants not pulling their weight in keeping the house tidy enough for the cleaner to work, we rely on open communication to address it. We have direct contact with all tenants and can identify patterns quickly. A direct, private conversation early resolves most situations before they become a formal issue.
For landlords considering co-living: a weekly common area clean typically costs $60 to $100 for the whole property. Split across three or four rooms that is $15 to $25 per tenant per week, absorbed into the room rate. Compare that to the cost of one vacant room for a month, one full changeover, or one tenancy dispute that escalates. The weekly clean is not a cost. It is income protection.
🧻 Consumables and personal supplies: why the setup prevents the dispute.
That call is a good example of how I handle these. No formal notice, no stern email. Just a quiet, kind conversation where the person who raised it stays completely anonymous. The tenant had no idea who mentioned it, did not need to, and started buying her own supplies. Done.
But here is the thing: even that conversation only happened because the setup was not quite right. When the physical arrangement and the written agreement are both clear from day one, most of these situations do not arise at all.
One tenant, we will call her Lisa (a fictional name), was using other housemates' toilet rolls rather than purchasing her own. A full roll would be gone within two days. When raised by another tenant, the response was that they had forgotten to buy some. Over several weeks this became a pattern.
A separate running issue involved cleaning supplies, bin bags 🗑️ and aluminium foil. Three of the four tenants were contributing and replacing items. The fourth was not. The three contributing tenants began tracking purchases and the atmosphere in the house deteriorated.
- Called Lisa privately and raised the situation kindly and without accusation, the reporter's identity was kept completely confidential throughout
- Framed it as a gentle reminder about the house arrangement rather than a complaint, which kept the conversation constructive
- Confirmed each tenant's assigned storage was clearly labelled so the expectation was obvious to everyone going forward
- Followed up briefly two weeks later to confirm things were running smoothly
The most effective way to prevent consumables disputes is a clear agreement and a physical setup that reflects it. Our co-living properties are set up with a lock on every bedroom door, assigned and labelled cupboards in the kitchen for each tenant, and labelled shelves in both the fridge and pantry. The occupancy agreement specifies that each tenant is responsible for their own consumables, including toilet paper, bin bags and cleaning products. When the physical setup and the written agreement align, disputes are rare. When either is missing, they are common.
🍳 Late-night noise: pots at 1am, phone calls at 2am.
Noise complaints in co-living are almost never one-offs. It is the same person, the same behaviour, at the same time every night. Pots at 1am. Phone calls in the bathroom at 2am. After a few weeks the people trying to sleep are not just tired. They are very quietly furious.
Two tenants, we will call them Tom and Anika (fictional names), had a pattern of cooking between 10pm and 11pm most nights, with pots and pans creating significant noise 🍳. Tom also had a habit of taking long phone calls in the toilet at 2am to 2:30am 📱, clearly audible through the walls. Anika was observed singing loudly without apparent awareness of the time.
The two other tenants in the house, a couple, we will call them Ben and Kate (fictional names), were being regularly woken by this. Ben and Kate worked early mornings. The impact on their sleep was significant and they were understandably frustrated after raising it informally with no change.
- Received the written complaint from G and E, acknowledged it promptly and confirmed it was being taken seriously
- Contacted Tom and Anika individually and outlined the specific behaviours reported, giving them the opportunity to respond before any formal action
- Proposed and implemented formal quiet hours: 10pm to 6am, documented in writing and agreed to by all tenants
- Confirmed with Ben and Kate that a quiet hours arrangement was being put in place and asked them to notify us immediately if the behaviour continued
- Issued a formal notice noting that breach of quiet hours could be grounds for action under the occupancy agreement
Quiet hours from 10pm to 6am should be standard in every co-living occupancy agreement. This is not an unreasonable imposition. It is a basic condition of shared living. Having it in writing from the start means you have a clear reference point if you need to escalate, and tenants have agreed to it upfront.
🤝 Cultural differences and communication: when one group stops acknowledging another.
This is probably the most delicate situation I deal with in co-living, and I want to be careful about how I describe it. Australia's share house market is genuinely multicultural and that is mostly a wonderful thing. But occasionally tensions develop between housemates that have a cultural or interpersonal dimension, and they need handling very carefully.
My approach is always the same: I respond to specific behaviours, not to cultural assumptions. I do not take sides. I document everything. And I make sure every person in the house feels heard and treated fairly, regardless of who raised the original concern.
Ben and Kate reported that Tom and Anika had stopped acknowledging them when they crossed paths in the house. No conflict, no argument, just a consistent absence of basic acknowledgement. Walking past in the hallway without any greeting. Being in the backyard together with no interaction. This had happened repeatedly over several weeks.
Ben and Kate described it as deliberate and said it made the common areas feel uncomfortable and hostile. They were distressed and found the dynamic made the shared space feel unwelcoming. The behaviour itself, regardless of its cause, was making co-living unworkable for them.
Separately, after a conversation about this issue, Anika was heard talking loudly about the situation near G and E's room in a way that felt designed to be overheard. This passive-aggressive behaviour added another layer to an already tense household.
- Documented G and E's complaint in full, including dates and specific incidents described
- Spoke to Tom and Anika individually, not jointly, and outlined the behaviours that had been reported without characterising intent or motive
- Made clear that a basic standard of civil acknowledgement between housemates was a reasonable expectation and that all tenants had a right to feel comfortable in shared spaces
- Issued a written notice to all parties reminding them of their obligations under the occupancy agreement regarding respectful shared living
- Documented all communications, noting that if the behaviour continued it could constitute grounds for a formal breach process
- Checked in with Ben and Kate within one week to assess whether the situation had improved
Cultural friction in co-living properties is more common than most landlords anticipate. It rarely involves overt conflict. It is more often a steady accumulation of small incidents that, unmanaged, erodes the household and eventually leads to vacancies. A property manager who handles this well documents everything, responds quickly and maintains scrupulous neutrality. One who handles it poorly either ignores it or takes a side.
🤝 Matchmaking: the work that happens before anyone moves in.
A lot of co-living friction is completely predictable. Not because tenants are difficult people, but because some combinations of people are almost guaranteed to clash. A night-shift worker and a 5am gym person. Someone who wants a social household and someone who needs quiet to study. These are not character flaws. They are just incompatible habits in a shared space.
Most agents fill vacancies as fast as possible. We try to place well rather than fast. I think of it as matchmaking, which sounds a bit much, but it genuinely reduces the number of difficult conversations I need to have six weeks later.
- Work and sleep schedule, night workers and early risers in the same house is a setup for noise complaints
- Social style, some tenants want a social household, others want to come home to quiet. Mismatched expectations here cause a lot of friction
- Cleanliness standards, we ask directly and we read between the lines of how people describe their last share house experience
- How long they intend to stay, short-term tenants destabilise co-living households. We prefer tenants who want to stay
- Whether they have met the existing housemates, where possible, we facilitate a brief introduction before a tenancy is confirmed
A good household reduces your management load more than almost anything else. Two compatible housemates who have been together for 18 months are worth far more than a constantly rotating tenancy even if the rotating tenancy fills vacancies faster. Stability is income. We prioritise placement quality over placement speed.
Considering a co-living investment in Australia?
Get an honest conversation about whether it is the right strategy for your property.
📋 House rules, the application process, and why it matters.
I keep coming back to this because it is the single thing that makes the biggest difference in practice. Most of the situations I have described become much easier to resolve when the paperwork was right from day one. Not just any document. The right document, signed, with the tenants having actually read it before they got the keys.
- Room application: Every prospective occupant completes a room application before any agreement is issued. This covers identity, references, employment, intended stay and lifestyle questions that help us assess household fit.
- House rules upfront: Applicants read the full House Rules before they apply. Quiet hours, cleaning responsibilities, visitor policy, security obligations, kitchen etiquette, garden care, no parties, no smoking anywhere on the property. All of it is visible before they commit.
- Lodging Agreement and annexure: On approval, occupants sign a Lodging Agreement plus a House Rules annexure. Both are executed through DocuSign before keys are issued. There is no ambiguity about what has been agreed.
- Property condition report: An entry condition report and room inventory are completed at the start of every occupancy. The occupant has seven days to review and comment. This protects both parties at the end of the tenancy.
When a dispute arises, the first question is always: what did they agree to? If the answer is documented, signed and dated, the resolution path is clear. If the house rules were only ever communicated verbally, or not communicated at all, you are managing a conflict without a framework. Every hour spent on documentation at the start saves multiple hours of dispute management later.
🔒 Leaving doors unlocked: a recurring and underestimated problem.
This one genuinely surprised me when I started. Lock the door when you leave. You would think that is obvious. But in a shared house where everyone assumes someone else did it, unlocked external doors are a real pattern. And it is not just annoying. It puts everyone in the house at risk and has direct implications for the owner's insurance.
Multiple complaints were raised about the front and back doors being left unlocked on a regular basis, including at midnight 🚪. The pattern was consistent with the same tenant. The other housemates reported checking the locks before bed and regularly finding them unsecured.
- Raised the issue directly with the tenant identified and confirmed the specific dates and times reported
- Issued a written notice reminding all tenants of their obligation to secure the property and explaining the insurance and safety implications of leaving external doors unlocked
- Noted that repeated failure to secure the property could constitute a breach of the occupancy agreement
- Recommended the owner consider a self-locking front door mechanism given the pattern
This is worth addressing at the property level, not just through notices. A self-locking front door (the type that locks when pulled closed) eliminates the most common failure point. The cost of installation is modest relative to the risk of an unlocked property. For the back door, a simple deadbolt with a requirement to turn the key rather than just push a button is also worth considering.
🌿 Gardening: nobody thinks it is their job.
Ask any group of housemates who is responsible for the garden. You will get the same answer from all of them: not me. It is one of those tasks that lives in the gap between individual rooms and shared responsibility, and without a clear system in place it reliably does not happen.
This matters more than it sounds. An overgrown garden affects the presentation of the property, the sense of pride tenants feel living there, and in some cases the owner's obligations under local council requirements. It also affects how the property photographs when a room becomes vacant and you need to re-let it quickly.
- Gardening responsibilities are specified in the occupancy agreement from the start, including mowing, watering and general tidiness of outdoor areas
- For most co-living properties we recommend the owner arrange a fortnightly gardener and include the cost in the room rate, for the same reason as the weekly cleaner: diffused responsibility in shared spaces leads to nothing getting done
- Where tenants are responsible for the garden, we include it in routine inspection checks and follow up directly if standards slip
- Watering systems and drought-tolerant planting reduce the maintenance burden significantly and are worth considering at property setup
A neglected garden 🌿 is one of the fastest ways to make a co-living property feel uncared for. Tenants notice. Prospective tenants notice when you are trying to fill a vacancy. A fortnightly gardener for a standard suburban block typically costs $60 to $100. Absorbed across three or four rooms, it is barely noticeable in the weekly rate. The alternative is chasing it up at every inspection.
One important nuance: co-living tenants come and go at different times. A tenant who moved in four weeks ago cannot reasonably be held responsible for the state of the garden when they arrived. Any gardening obligations in the Lodging Agreement need to be applied with common sense and proportionality. A new occupant is not accountable for what the previous one did or did not do. Where we use a fortnightly professional gardener, this issue does not arise at all, which is another reason we recommend the owner-paid model rather than relying on tenant rosters.
💸 Bills, bond and pro-rata disputes: the mathematics of shared utilities.
Nobody talks about this part. Utility bills in a co-living property are genuinely complicated. Someone moves in mid-cycle. Someone leaves two weeks early. Someone goes on holiday for six weeks and raises the question of whether they should still be paying. Unless the billing methodology is documented clearly from day one, you will spend real time on this.
At one property, a tenant going on an extended holiday raised the issue of whether they should continue to pay a full share of electricity during their absence. At another property, a departing tenant refused to pay their final utility bill until they received an invoice with GST itemised under their name rather than the agency's. At another, a tenant disputed a pro-rata charge calculated on a 30-day month rather than the actual days in the billing period.
None of these disputes were unreasonable from the tenant's perspective. All of them were time-consuming to resolve.
- Reviewed and updated the utility billing clause in the occupancy agreement to specify the methodology for pro-rata calculations and the treatment of extended absences
- For the holiday dispute, confirmed the position in writing (the tenant remained liable for their share regardless of presence) and provided a written explanation of the reasoning
- For the GST dispute, obtained the correctly itemised invoice from the utility provider and reissued it to the tenant before pursuing the outstanding amount
- Implemented a policy of issuing utility reconciliations to all tenants simultaneously rather than individually to reduce the scope for dispute
Utility billing arrangements should be documented in writing before any tenancy commences. The occupancy agreement should specify: how bills are split, the methodology for pro-rata calculation, whether extended absences affect liability, and the timing of utility reconciliations. Ambiguity here is expensive. An hour spent clarifying this at setup saves many hours of administration later.
💡 What landlords need to know before investing in co-living.
So is co-living worth it? My honest answer: yes, if the property suits it and you have the right management in place. Room-by-room rental on the right property regularly generates 30 to 50 percent more gross income than a standard tenancy. I have seen it work really well. I have also seen it become a genuine headache for landlords who were not prepared for what it involves.
Everything I have described above is normal. Not exceptional, not worst-case. This is just what co-living management looks like week to week. A week rarely goes by without at least one situation that needs handling. That is fine, if you are set up for it.
The question is not whether these things will come up. They will. The question is whether your property manager has the experience, the systems and frankly the patience to handle them well.
| Issue type | How we approach it |
|---|---|
| House rules and agreements | All occupants sign Lodging Agreement plus House Rules annexure before keys are issued. Tenants read house rules before applying. Entry condition report completed on day one. |
| Tenant matching | Review work schedules, social style, cleanliness approach and intended stay before placing. Facilitate introductions where possible. |
| Cleaning disputes | Weekly professional common area clean, owner-paid, built into room rate. Tenants responsible for own mess. Cleaner will not work in an untidy house. Direct communication with tenants if standards slip. |
| Personal consumables | Each tenant responsible for their own (lease clause); locked bedrooms; labelled cupboards, fridge shelves and pantry spaces per tenant |
| Noise complaints | Quiet hours 10pm to 6am written into agreement; breach notice process if repeated |
| Cultural and social friction | Document everything; respond to behaviours not motives; maintain strict neutrality |
| Security failures | Written notice; property-level solutions (self-locking doors); breach process if repeated |
| Gardening | Fortnightly gardener owner-paid and built into room rate. Responsibility specified in occupancy agreement. Checked at every routine inspection. |
| Gardening | Fortnightly gardener, owner-paid, built into room rate. Responsibility in occupancy agreement. Checked at routine inspections. |
| Utility and bond disputes | Methodology documented in agreement before tenancy starts; reconciliations issued simultaneously to all |
When a tenant is the problem: what you can actually do
This is what I want landlords to really understand. Because co-living runs under a Lodging Agreement rather than the RTA, you have proper options when someone is genuinely making life difficult for the rest of the house. Here is what that looks like in practice:
To be clear, I do not reach for these tools lightly. Communication and patience usually get there first. But it matters enormously to know they exist. One difficult tenant should not be allowed to make everyone else's lives miserable while you wait out a lengthy process.
Note: The legal position for co-living varies by state and territory. This post contains general information only and is not legal advice. Always seek independent legal advice for your specific state before taking action on a breach.
One last thing, and I mean this. A lot of the people in co-living properties are new to Australia, new to shared living, or both. Most of the situations I have written about in this post do not happen because people are bad or difficult. They happen because expectations were not set clearly, or because two people with very different habits ended up sharing a kitchen. A good property manager approaches that with patience and some genuine care for everyone involved. The goal is always resolution. Not conflict.
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