It's also no longer socially taboo for single roommates of mixed genders to live together. And of course people are staying single longer, meaning that there are now more urban singles.

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.