Housing Minister Eoghan Murphy has accused critics of co-living of misrepresenting the concept.
He says the concept is only aimed at young workers staying for about six months to a year.
A development planned by Bartra Capital in Dún Laoghaire proposed to charge €1,300 a month for a private room - sharing a kitchen with dozens of others.
Critics said it offered a low standard of living -- and it was refused by council planners.
Minister Murphy says young people don't necessarily want to share a home with just only a few others.
"They're not yet at the point where they want to live with one other person or two other people.
"They will do (co-living) for six or 12 months until they are six or 12 months into their first job," he explained.
"The problem is when the co-living was presented by some people they were trying to present it that this is what we were saying this is what we wanted the new rental market to look like - it is not."
