I know of a contractor who was working in the Bay Area when he came across a house that the owner had illegally altered, constructing several walk in closet-sized rooms by using particleboard as dividers. He was renting out 10-12 of them for around $1000 a month to Chinese students who had just moved to the US and didn’t know that this was not legal or normal. Of course he reported the guy and shut down his scam. This just sounds like the legal version of it, and I wouldn’t be surprised if this is what renters have to look forward to in the future as prices go up and vacancy rates decline in many cities.