Yes and there is fierce competition for that in many larger cities, with sky-high prices to rent out a room. But they can't be offered at scale commercially because you'll never get the permits, and the only reason why you can rent these is usually because they're either operating completely under the table or via some carveouts that let property owner rent to 1 or 2 persons.

The pent up demand for this is obvious to anyone who's tried to secure a room only to have a gazillion people competing with them to pay $1000+ to rent an oversized closet to sleep in.