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Who should I use to invest in co-living property in Melbourne, and where do I start?

· Yannick Ieko

Who should I use to invest in co-living property in Melbourne, and where do I start?

Answering: Who should I use to invest in co-living property in Melbourne, and what is the first step before I talk to anyone?

Estimated reading time: 10 min read

Start by learning how co-living actually works, then vet the operator against what you would own, how the site is chosen, who pays them, and who manages the building. Do not start by booking a sales meeting.

You may be interstate, with two or three operator sites open in your browser and at least one of them quoting a yield that looks too good to be true. Each one talks as if co-living were a single product. It is not. Harmony builds in Melbourne. Investors come from every state. A Harmony project is one knock-down-rebuild site in Melbourne’s middle ring, on which the team builds one purpose-built dwelling containing nine rooms and nine bathrooms. Clients pay Harmony $0. The first step the team offers is a free co-living education program.

Key Insights

  • Start by learning how co-living works before you talk to anyone.
  • You should own the whole building, not a unit in a fund and not a share of someone else’s project.
  • Class 1b, council registration as prescribed accommodation, and a rooming-house operator licence are separate layers. None of them replaces the others.
  • Harmony selects sites with the 118-point method. Clients pay $0. Builders pay the fee at settlement.

Table of Contents

Be clear on what you would own

What you should own is the whole building. Nine people live in it, each on their own lease. A specialist property manager runs it. It is not pooled into a fund or a syndicate, and it is not a part-share. If an operator is selling you units, a managed scheme, or a slice of a larger site, you are looking at a different product, even if the brochure says co-living.

Harmony’s version of that building is purpose-built from the ground up. Each of the nine rooms has its own bathroom, with shared living space alongside. The configuration is nine rooms, nine bathrooms, single storey, including two executive rooms. Smaller configurations are not the product. The Harmony Formula, as the team describes it, is nine bed, high-end, good location, established area.

That is also why the first conversation should not be a yield conversation. If you do not own the whole building, the rent figure on the page is not your rent. If you own a share of a scheme, you cannot change the manager, the fit-out or the site. Co-living investment with Harmony requires a minimum of $600,000 in cash, usable equity, or a combination of both. That is an entry point into one title, not a ticket into a pool.

That ownership test is the first filter because everything else hangs off it. Finance, management, registration and resale all change if you own one title with nine leases rather than nine unrelated rooms in a house you never redesigned. Harmony’s co-living page sets out that distinction in the same terms: you own the building, nine people live in it, each on their own lease.

Check the regulatory shape

Co-living in Victoria sits under more than one rule book. A building classification is not a council registration, and a council registration is not an operator licence.

Under the National Construction Code, a Class 1b building is a boarding house, guest house or hostel with a floor area less than 300 square metres that ordinarily has fewer than 12 people living in it. That classification is issued through the building-permit process by a registered building surveyor. It tells you how the building was designed and certified. It does not, on its own, let someone operate it as a rooming house.

Consumer Affairs Victoria describes a rooming house as a building where four or more people can live in rented rooms, some of which might be shared. The operator usually holds a separate agreement with each resident. Rooming houses must be registered with the local council as prescribed accommodation under the Public Health and Wellbeing Act 2008. The council may inspect the premises against the Public Health and Wellbeing (Prescribed Accommodation) Regulations 2020.

Separately, the person or company operating the rooming house must hold a rooming-house operator licence under the Rooming House Operators Act 2016. The Business Licensing Authority grants those licences to applicants who are fit and proper persons. The licensing scheme came into effect on 26 April 2017. A successful application produces a licence for three years. The obligation to be licensed is in addition to the obligation to register the premises with council. Consumer Affairs Victoria keeps a public register of licensed operators. That register records the licensee, not the address of every premises. Premises sit on the council register.

A building permit is still required for a new dwelling. A planning-permit exemption, where it applies, does not remove the building permit, the council registration or the operator licence. Harmony’s guide to the licence, registration and Class 1b stack walks those layers in full. For choosing an operator, ask which of them they hold, and treat a missing layer as a stop, not a detail.

Ask how the site is chosen

Ask how the site was chosen before you ask what it yields. A purpose-built nine-bed lives or dies on the suburb, the street, the planning settings and the tenant demand around it. Guesswork is expensive because you own the whole building.

The Harmony Group uses the 118-point method to select sites in Melbourne’s middle ring. It scores market analysis, area selection and property specification; of the 20 to 30 markets the team analyses each quarter, typically only 4 to 6 pass, and around 85% of the opportunities it assesses are turned down. Class 1b certification is confirmed on every property before commitment. The process can run remotely. You do not have to live in Melbourne to have the site logic explained. The team brings 15+ years of specialist accommodation experience to that site work.

If an operator cannot tell you how they reject sites, they are asking you to buy a location story. Ask what would make them walk away from a block. Ask whether the dwelling is designed as a nine-bed from the first drawing, or adapted from a house that already exists. Harmony’s product is purpose-built. An adapted existing house is a different risk.

The Build Formula, at principle level, is an exclusive partner network of architects, a builder, hotel fit-out specialists and specialist property managers; nine rooms, nine bathrooms, single storey; two executive rooms; and a seven-year structural guarantee. That is the shape you should be able to inspect. It is not a specification sheet of brands and finishes.

Ask who pays the person advising you

Ask who pays the person sitting across from you. MoneySmart’s warning on investment property still applies: be wary of property investment advice from groups of service providers who recommend each other’s services. That does not make every referral dishonest. It does mean the invoice tells you whose job you are listening to.

Clients pay Harmony $0. The firm is paid by builders at settlement, the same fee across all builders, so there is no incentive to prefer one over another. That is a different payment path from a buyer’s agent, whom you pay under a buyers’ agency authority, and from a licensed financial adviser, whom you pay under the fees in a Financial Services Guide.

If the person in front of you is paid by you to find any property, they are not paid to deliver this building. If they are paid by a developer to sell a specific project, they are not paid to compare it with every other use of your equity. Ask the question out loud: who writes your invoice if I proceed, and who writes it if I do not?

Ask to see a finished property

Before you commit to any operator, ask to stand in a finished, tenanted building they have delivered.

A walkthrough is useful only if you know what to look at. Harmony’s Melbourne walkthrough checklist covers the outside, the shared living space, the rooms and the questions to put to the manager. Look at whether each room has its own bathroom, whether the building is single storey, and whether the common areas look like a place nine residents can share. A finished property will not tell you the yield. It will tell you whether the drawings became a building you would be prepared to own.

Ask who manages the building

A specialist property manager runs the building. Nine separate leases is a different job from one household on a single residential tenancy. What you need to know is the role: who lets the rooms, who handles vacancies, who deals with council registration and who the residents call.

Consumer Affairs Victoria distinguishes a rooming-house operator from a manager engaged by that operator to handle day-to-day work such as agreements, notices and rent. The operator is the licensed person or company. The manager may be an estate agent engaged by the operator. Ask which licence sits with whom, and ask what happens when a room turns over. If the answer is that a standard residential manager will slot it in between houses, you do not yet have an operating model.

Start with the free education program

The sensible first step is not a meeting. It is Harmony’s free co-living education program. The program covers how co-living works, what you would own, and how a purpose-built nine-bed is designed and run. The core is roughly 45 minutes long. Finish any 9 modules and a booking link opens for a one on one with one of the directors. The director conversation is what opens after the coursework. It is not the starting point.

If co-living isn’t suitable for you, we’ll tell you why. That line only works if you have learned enough to hear it. Use the checklist below on any operator you compare, including this one.

A short vetting checklist

What to check Pass looks like Fail looks like
What you own One title. The whole building. Nine separate leases. A fund, a syndicate, units, or a share of a larger site.
Building classification Class 1b, through a building permit and a registered building surveyor, confirmed before you commit. A brochure claim with no permit trail.
Council registration Premises registered as prescribed accommodation with the local council. Operator says the building class is enough.
Operator licence Licensed under the Rooming House Operators Act 2016 and findable on the public register. No licence, or licence confused with council registration.
Site method A named method for accepting and rejecting sites. Harmony: the 118-point method. A suburb slogan and no rejection test.
Who pays the adviser A clear invoice path. Harmony: clients pay $0, builders pay at settlement. Unclear fees, or a chain of referrals with no payer named.
Finished property A completed, tenanted nine-bed you can walk through. Renders only.
Who manages it A specialist manager for nine leases. Operator licence sitting with the right party. A standard house manager adding rooms between listings.

Frequently Asked Questions Before You Pick an Operator

Q: Do I have to live in Melbourne to invest?

No. The team builds in Melbourne. Investors come from every state. The process can run remotely. You still need a broker who can place the loan and, if you want personal advice, a licensed financial adviser who can test whether the purchase suits you.

Q: Is co-living a fund or a share of a building?

Not in Harmony’s product. You own the whole building. Nine people live in it, each on their own lease. A specialist property manager runs it. If another operator is offering units in a scheme or a share of a larger site, that is a different structure. Ask what sits on the title before you compare income figures.

Q: What licences does a Victorian rooming-house operator need?

The operator must hold a rooming-house operator licence under the Rooming House Operators Act 2016, granted by the Business Licensing Authority. The premises must also be registered with the local council as prescribed accommodation. A Class 1b classification is a building matter. It does not replace the licence or the registration. Check the public register of operators and the council register of premises.

Q: What should I look at in a finished nine-bed?

Take a checklist. Check whether each room has its own bathroom, whether the building is single storey, whether the common areas look like a place nine residents can share, and ask the manager how the building actually runs.

Q: Where should I start if I am still comparing operators?

Start with the free co-living education program. The core is roughly 45 minutes long. Finish any 9 modules and a booking link opens for a one on one with one of the directors. Use that preparation to test ownership, fees, certification and management against any operator you meet.

Learn how co-living works before you talk to anyone

The free co-living education program covers what you would own, how a purpose-built nine-bed is designed, and how the building is run. The core is roughly 45 minutes long. Finish any 9 modules and a booking link opens for a one on one with one of the directors. If co-living isn’t suitable for you, we’ll tell you why.

Citations

General information only. The Harmony Group provides general information about property and co-living investment, not personal financial, tax or legal advice, and does not hold an Australian Financial Services Licence (AFSL). It does not account for your objectives, financial situation or needs, so consider its appropriateness and seek advice from a licensed financial adviser, mortgage broker, accountant or the ATO before acting. Past performance is not a guide to future results and historical figures may not be repeated. The 2027 negative gearing reform was enacted on 26 June 2026 and applies from 1 July 2027. The definition of a new residential dwelling is still being settled after Treasury’s consultation, so whether a nine-bed is an eligible new build remains unsettled. Other tax or regulatory measures described are subject to change.