MICRO LIVING WITH A MACRO LIFESTYLE
COULD micro living become a way of life?
The definition of micro living is geographically dependent, but on our KZN North Coast, it means living in a sectional title property ranging in size from about 15-30sqm and priced between R500 000 and R1 million. The target market is millennial creatives and professionals ranging from 20-35 years of age.
The fundamental idea of micro living is trading the luxury of space, usually found in the suburbs, for significantly smaller space in the trendy heart of the metro where all the action can be found and where real estate prices are usually high.
By buying a smaller space, the absolute ticket price is more affordable and, if the development is designed properly, this doesn’t come at a lifestyle cost as its facilities match and often exceed those found in a lavish suburban home – albeit these are shared between the resident community.
Micro-dwellers in these units enjoy walking access to the metro’s top-rated attractions, entertainment options and amenities as well as easy access to key transport hubs and the workplace.
Is owning a car even necessary? If the development provides an Uber collect-and-drop facility, shuttle service or car pool arrangement, these millennials may well choose to disown the inconvenient rigidity of monthly car instalments, fuel and maintenance and rather opt for the ultimate freedom and flexibility of a pay-as-you-go solution. After all, the end goal of micro-living is to have ultimate flexibility and maximum lifestyle with minimum admin.
Another upside is the sense of community and lifestyle - post-Covid - as residents engage with other likeminded people in activities such as gym, yoga, Pilates, or even catching up over a cup or glass of the latest brew all within the boundaries of the scheme.
The living space itself requires innovative design to facilitate space saving and an example of this is having a fold-up bed that doubles as a dining room table, or which may even be raised above the living area altogether to free up space in the apartment.
The micro living proposition may also make good financial sense as it allows buyers to get onto the property ladder by acquiring apartments in great areas that would usually be financially out of reach. And when moving on, the owner may choose to rent out the property at a high yield or re-leverage and buy a second property, thereby facilitating the growth of a property portfolio.
The micro living model dismisses the traditional notion of valuing property purely on a price-persquare-metre basis and rather requires investors to fully appreciate the value proposition of the development and the lifestyle that it has to offer.
Fortunately, renters have long shed the attachment to the price per sqm valuation method, opting rather to value property based on the above appealing benefits. This means that while a micro living apartment may be expensive when judged by traditional methods, as long as the development is designed to satisfy the needs of its target market, tenants will find value and be prepared to pay in excess of traditional square metre rates. For this reason, micro living apartments have been known to achieve rental yields far beyond those of traditional long-term rental properties and many sophisticated investors have woken to this opportunity.