that may be a part of it, but I doubt it's the whole story. people don't just need a small room and a bed; they need kitchens, bathrooms, etc. these can be shared across a floor or a small building, but there's only so many strangers that can share a kitchen before it isn't useful to anyone. it's hard to imagine this being better than at least having the chance to find 3-4 people to split an apartment with.