Co-living is a form of shared accommodation that in the UK usually comprises ensuite bedrooms with shared kitchen and living areas.
It is typically aimed at young professionals, to provide affordable accommodation for those priced out of buying a home or renting a flat.
A number of co-living schemes have been approved in London and other UK cities in recent years.
However, a report that was approved by the city council's executive committee last week states that the concept of co-living is "new and untested in the Manchester housing market" and can hence be "less appropriate locally".
The document, written by the council's strategic director for growth and development, Eddie Smith, says: "Some co-living schemes may not meet Manchester’s space standards, and will not generally be seen as appropriate development in terms of providing permanent homes for our residents."
It adds: "As co-living schemes are classed as Sui Generis in planning terms, they are not required to conform to the nationally prescribed space standards attributed to other mainstream housing."
It goes on to say that the evidence suggests that "some units - mainly studios - are up to around 50% smaller than these standards".
A lack of council tax revenue and affordable housing provision were also cited as potential concerns.
Unlike in London, Smith’s report suggested that co-living is not required in Manchester to address unaffordable rent levels.
The committee agreed that the council should consult on the proposed response before developing a formal policy on the issue as part of the preparation of its next local plan.
In advance of any new policy, the report proposes that the council considers a "limit on new developments".
Co-living schemes, it says, "should only be supported in a very limited number of places, in restricted amounts, within the city centre" and under "specific circumstances".
Such schemes "should be restricted to a limited number of key areas of high employment growth within the city centre" that are "well connected, to ensure residents can access public transport, walking and cycling routes in the city".
In addition, they should only be considered "as part of an employment-led, strategic regeneration framework (SRF), where it can be demonstrated that a co-living development will provide added value to the wider commercial offer in the area".
Furthermore, schemes "must demonstrate that they command support from recently arrived or new employers located in, or in the vicinity of, the regeneration area they form part of".
They should also be underpinned by "robust justification demonstrating evidenced need", while only "safe and secure, zero carbon developments" will be considered.
A feature looking at the potential impact of co-living on planning can be found here.