Small Studio Apartments: Are They the Next Big Thing?

If you already have a studio or if you rent one, we have some good news for you: these little units are the next big thing in real estate. Since people are downsizing globally and looking for ways to live more efficiently, studios are a perfect solution for all their needs. But why are these small studio apartments so attractive to investors and buyers? Here’s all you need to know. 

Their location is usually top-notch

Location is one of the most important driving factors when it comes to investing in real estate, and what small studios lack in space, they make up for in location. Major city centers are often the best places to buy a property, but prices are usually astronomical. Finding an affordable property with a bold design can be hard in these areas, but studios have smaller square footage which lowers the price tag and allows even beginner investors to grab a property on a prime location. 

They are affordable

If your budget doesn’t allow you to get a traditional investment property like a multi-family or single-family home, consider getting a studio apartment. This is the best way to invest as little money as possible and gain exposure to the real estate market. Also, they are easy to rent out or sell with some minor staging efforts, so if that’s your goal, you’re all set. 

They are practical

Today, people are rapidly leaving the countryside and moving to cities, so urban areas need a practical and functional solution that will accommodate a large number of residents. According to some predictions, 68% of the global population will live in cities, so major urban environments are opting for the concept of compact living when it comes to residential architecture. 

Many of the world’s metropolises like Hong Kong especially love this downsizing trend, and the concept of small studio apartments is blooming there. Everyone from digital nomads to young professionals and students is choosing apartments for rent in Hong Kong thanks to their convenience, price and low-maintenance costs. With all the necessary amenities at your disposal, it’s easy to see why studios are so practical. 

They are green

More and more people today are choosing a more eco-friendly and sustainable lifestyle that rangers from dietary changes and adopting better shopping habits to saving energy and water and downsizing to more eco-conscious housing solutions. Small, compact living spaces are always greener than big houses, no matter how well designed. Smaller square footage equals less energy consumption, less maintenance and less furniture, all of which can contribute to your smaller carbon footprint. 

They are easy to maintain

Like stated above, studios are small and they naturally require less cleaning and decluttering. Small studios are also easy to organize and keep clean since there’s less room for decoration and other trinkets that do nothing but collect dust. This makes them perfect for minimalists or people who hate or simply don’t have time for cleaning. In general, one can clean and declutter an entire studio apartment in an hour while ensuring maximum living and sleeping comfort. 

They bring a good return on investment

If you intend to break into the real estate market and make money on your first try, go with small studios. According to research, small studio apartments increase your ability to make money and yield an excellent return on investment. Even though the rent in studios is more than affordable to tenants, the price is still high when taking into consideration the square footage. Usually, small units outperform big apartments and family homes, they have high occupancy rates and sport pretty high rental-rate premiums. Since they are more or less a safe bet, small studios are perfect for beginner real estate investors, especially those who don’t like to gamble too much. 

Studio apartment cons

Don’t think small studio apartments don’t come without a flaw. No matter if you’re investing or renting these small units, you need to know about the risks. In general, certain countries and states have minimum apartment size requirements, so super-small micro-apartments might create a problem. There are also various housing codes, zoning regulations, municipal ordinances, minimum parking standards, unit-mix rules, outdoor open-space and indoor common-space provisions to look into. 

Additionally, even though small studios always have their place in the rental market, they are not suitable for everyone. Usually, they are reserved for single working professionals or students. This means your tenant group will get smaller and you will need to forget about families. 

In real estate, bigger is not always better. While small studio apartments have their cons, they have a huge pile of benefits to offer to both investors and residents, so if you want something practical and cost-effective, go small with a studio. 

About the author: Mike Johnston is an avid blogging enthusiast and experienced freelance writer with a focus in real estate, home improvement, interior design, and sustainable living.