Ian Ugarte and the co-living model
Ian Ugarte is not your average property developer. Or rather, he was, but after a mid-life crisis forced him to re-evaluate his business model, he realised that money didn’t make him happy, and lack of purpose made him incredibly sad. As Ian said:
It needs to make sense before it makes dollars. it needs to do both. You can do good and do well.
His solution? Create affordable housing options which look after the needs of working singles and couples, as well as make investing in housing affordable for everyday investors.
The problem as Ian sees it, is that there is an upside-down housing market in Australia, where 60-80% of the houses built are large 4-bedroom/2-bathroom properties, and 60-80% of the rental market are singles and couples. This results in a supply-demand mismatch, where singles and couples are rattling around in houses too big for their needs, which reduces the availability of these larger houses for families who do need the extra space.
In addition, rental prices are soaring. Australia has one of the most unaffordable housing markets in the world, and on the Mid North Coast, increased housing costs are biting deep. Data from the 2021 census tells us that 6 out of 10 Local Government Areas under the greatest housing stress in Regional NSW are in the Mid North Coast region, and that 35% of renters are experiencing rental stress, which is unsurprising considering the average rent has risen from $270/week in 2016 to $330/week in 2021.
What can be done about it? Affordable housing is a complex problem, and there is no silver bullet solution. Ian Ugarte decided to focus on two segments of the population which have been neglected by both government and property developers: working singles and couples, and women over 55. One the one hand you have young people who cannot afford to save up for a house deposit while they are renting, meaning that many will not be able to own their house until their parents die – and for many in generational housing poverty, not even then. On the other hand, you have women over 55, the fastest growing homeless demographic, having to sleep in their cars or couch surf after divorce because they had been busy caring for their families rather than accumulating resources and honing their employability skills.
Ian saw an opportunity in the oversupply of 4-bedroom houses, so he decided to do something radical: convert those large homes in to 4 micro apartments with 4 separate doors. Each micro unit includes a bedroom, a bathroom, a sitting room and a kitchenette, with a shared kitchen and laundry. Utilities are included, so each unit rental price includes water, electricity and internet. How much? Each unit is rented out for between $250-$350/ week, making these properties affordable for the people who need it.
Regional Development Australia Mid North Coast (RDAMNC) has a focus on innovative housing solutions on the Mid North Coast, with a focus on affordable housing for key workers. We think Ian Ugarte’s co-living housing model is one solution to the many-faceted housing crisis facing us on the Mid North Coast. For more information on Ian Ugarte’s co-living housing model, go here and take a tour of one of his co-living conversions here.
Find out more about what we are doing in this space by watching Our Spaces: a film we made to explore housing opportunities that everyday people on the Mid North Coast have created in their own homes. What can you do? Take the flatmate pledge and host a watch party.