The Airbnb era in Denver came fast—and now, for many property owners, it’s fading just as quickly.

Dr Connor Robertson Real Estate

In 2016, short-term rentals felt like the perfect income strategy. You could rent out a basement, a spare bedroom, or your entire house for weekends and bring in thousands. But as regulation tightened and guest expectations rose, that model stopped making sense for a lot of owners.

Denver put clear restrictions in place: permits, primary residence requirements, limits on non-owner-occupied units. Add in taxes, turnover costs, and the unpredictability of guest behavior, and suddenly the once-lucrative “Airbnb strategy” became more of a headache than a solution.

So what’s replacing it?

Co-living.

It’s not new, but it’s getting smarter. And in Denver’s urban core, co-living is quietly outperforming short-term rentals in ways most people haven’t considered.

What Co-Living Actually Looks Like in Denver

Let’s start by clarifying the model. Co-living isn’t cramming strangers into bunk beds. It’s thoughtfully organized shared housing. Each resident has a private bedroom, and sometimes a private bathroom, but they share common spaces like kitchens and laundry areas. Tenants often stay for months at a time, not days. It’s a long-term play with short-term flexibility.

In neighborhoods like Capitol Hill, Five Points, Baker, and Athmar Park, properties are being adapted to meet this demand. And it makes sense: these areas have dense housing, high walkability, and a population that needs something in between an apartment lease and a $400/night hotel.

Instead of listing a whole home on Airbnb and dealing with weekend guests, owners can rent out each bedroom for steady income. No daily turnover, no new guests every few nights, and no need to constantly re-list the property.

Why It’s Working Better Than Short-Term Rentals

There are a few clear reasons co-living is catching on—and they all revolve around stability:

1. Higher Occupancy, Lower Turnover Co-living tenants typically stay 3–12 months. That means fewer vacancies and less wear-and-tear on the property.
2. Fewer Legal Headaches Denver’s short-term rental laws are strict. Co-living, when structured properly under the city’s group living ordinance, is fully compliant—and doesn’t require STR licenses.
3. Better Predictability With co-living, rent is consistent. You know what to expect month to month. There’s no risk of low-season drop-offs or event cancellations.
4. Community Fit Let’s be honest—neighbors prefer long-term residents to a revolving door of travelers. Co-living tenants become part of the community, not just a guest passing through.