Silicon Valley, the northern California innovation hub that is home to the likes of Apple and Facebook, is becoming a hot spot for another kind of experimentation – shared living quarters. The concept has been spreading around the globe, including in Hong Kong, as companies spring up in cities with eye-watering housing costs and lots of young and single professionals open to group living arrangements. Different business models are being tried. One company getting its footing in expensive Silicon Valley is HomeShare, which acts as a online matching service to connect people seeking affordable housing in expensive markets with landlords specialising in group homes. These residences generally offer private bedrooms but shared common areas such as bathrooms, kitchens and living rooms. “Customers are on average 28 years old and range between high-paid engineers as well as service workers," said Jeffrey Pang, HomeShare’s founder and CEO. People looking for group housing go to his website, submit an application, and are matched with others seeking group housing at the same time. They pay a “very small percentage” of the monthly rent – “lower than 10-15 per cent” – Pang said. Co-living becomes quite the rage among Hong Kong’s young professionals Paying less is usually the clients’ key motivation, but some also simply enjoy communal living. And mobility is a premium, because the typical young profession may move often in trying to climb up the career ladder. HomeShare clients typically pay US$800 in monthly rent to live in the San Jose area and US$1,200 a month for closer in to San Francisco. A one-bedroom apartment in San Jose typically rents out at US$2,500 a month, while in San Francisco, it costs as much as US$3,600 a month, he said. Leases are generally for a minimum of one year. “In the case of San Francisco, we save residents up to US$2,400 a month, albeit they are getting a shared apartment rather than a private one bedroom," Pang said. "The savings are naturally higher in San Francisco but are still about US$1,000 plus per month in most markets ... Over a year, that really adds up with US$24,000 in savings, which would equate to US$32,000 in pre-tax earnings or 40 per cent of our average resident's US$80,000 income.” A big question hanging over the emerging sector is how companies can distinguish themselves and survive in what is becoming a hotly competitive market. San Francisco-based Airbnb, for example, does similar match-making services but usually for shorter periods of time, including daily and weekly rentals. Airbnb, while hugely popular, has sparked a backlash in cities and condominiums over such concerns as lost tax revenue, a drop in hotel business, potential crime and the changing of a building’s vibe. “The benefits are based on the assumption that the sharing economy does provide a better living and working space in a cost-effective manner,” said Maggie Hu, an assistant professor of real estate and finance at the Chinese University of Hong Kong. “If they fail to do that, all stakeholders will suffer a loss,” she said, such as investors. HomeShare, founded in 2016, raised US$5.4 million in its seed round in January, he said. In addition to Silicon Valley, it offers its matching service in New York City, San Francisco, Seattle and Los Angeles. In the US, WeLive and Common also operate with similar business models. Meanwhile, Singapore-based co-living company Hmlet has also announced its entry into Australia, its second overseas location following its expansion in Hong Kong. The company is seeking to quadruple its number of members to more than 2,400 across Asia Pacific by the end of the year. It will operate in Sydney's inner-city suburbs of Newton and Marrickville. In November, the start-up raised US$6.5 million in an early funding round led by Sequoia India. Australia is the third most popular destination for international students and young professionals. More than 1.2 million people aged 20 to 35 years old live in Australia’s major cities and spend at least 30 per cent of their monthly take-home pay on rent, Hmlet said. “With the growing demand for more flexible, community-based options of living in urban cities such as Sydney, Australia felt like the next natural move for us,” said Yoan Kamalski, Hmlet CEO and co-founder.