HOUSTON – (By Dale King, Realty News Report) — The nation’s rental housing landscape is filled with upscale leasing opportunities designed to attract millennials to Generation Z’ers.
But finding larger multifamily dwellings for families searching for affordable and acceptable rental living is a challenge across America.
“Family renter households are a large and often forgotten segment of the American housing landscape,” says a report recently published by the Urban Land Institute’s Terwilliger Center for Housing.
The ULI report says the housing developers, after years of catering to the younger population, may finally turn its attention to the needs of families.
“Going forward, families are likely to play an even more important role in the rental housing market,” says the document drafted by a number of staff members at Washington, D.C. – based ULI, including Christopher Ptomey, executive director of the Terwilliger Center.
“Families make up one-third of American renters. But the vast majority of new apartments cater to young, childless urbanites,” says the report. “The average newly built apartment is barely more than 900 SF — with a median rent of $1,600 per month. That’s a far cry from affordable for most rental families, nearly 60% of which make less than $50,000 a year.”
“From suburban townhouses to multifamily apartments, family-oriented rental housing is starting to emerge across the country. Although rarely explicitly marketed to families, these communities offer floor plans, amenities and locations that are especially attractive to households with children.”
In addition, the report states: “These family-friendly rental options have been built in relatively small quantities during this economic cycle, despite the increasing demand. This mismatch between the supply of and the demand for family-oriented rental housing is partly attributable to barriers that stand in the way of development.”
“There are a number of reasons why this product is not yet widespread, ranging from developer resistance and unfamiliarity to regulatory obstacles and limitations. Moreover, this product is actually disappearing in many cases, as developers convert, subdivide and redevelop existing family housing into units less appealing to households with children. This dynamic highlights the risk that family renters face, as well as the opportunity to better serve these individuals.”
ULI researchers say the family demographic is poised to experience significant growth in the 2020s and beyond as more millennials have children.
Housing preferences are also shifting in a way that supports family-oriented rental development. “Together, declining homeowner rates and rising housing costs are spurring a need for – and a business opportunity to bring—new and interesting forms of rental housing that target a broader range of households, including many families.”
Familial units today “are more diverse than ever. They are no longer limited to the traditional archetype of two parents with one or more children. Single-parents and multigenerational households are becoming increasingly common, and these groups have vastly different housing needs, prompting an important question: What is family-oriented rental housing?”
“This report defines it broadly: Housing of any density with two – or ideally three – bedrooms.”
The staff at ULI and the Terwilliger Center came up with more than a dozen housing styles with amenities and accommodations particularly attractive to families with children.
The rental townhouse is an appealing alternative to home ownership, the report says. It’s designed for young families who are not ready to leave the mixed use neighborhoods in which they live, but who are starting to require additional space for children.
One example is Camden Highland Village in Houston, which offers 38 luxury townhouses, located about five miles outside of downtown between the Uptown and Greenway/Upper Kirby neighborhoods. The structures include high-end features such as custom kitchens, modern finishes, private yards and attached two-car garages. Unit sizes exceed 2,000 SF.
Other rental alternatives included in the report are:
- Suburban rental apartments, which appeal to families that need more space or more bedrooms than what is found in a more urban setting. Renters are normally those looking for a certain school district or neighborhood, and are saving money to buy a home.
- Suburban single-family rentals are typically located in suburban or exurban settings with high-performance schools. One such offering is American Homes 4 Rent at Addison in Austin. It is an enclave of 130 detached single-family rental homes in Addison, a master-planned community. Units range from 1,420 SF to more than 2,500 SF.
- Rental townhouses are common in the suburbs where they can serve as a permanent solution for households priced out of home ownership.
- Detached and attached apartments offer a variety of suburban amenities while still providing the flexibility and convenience of denser rental apartments. These homes offer features like attached garages and private yards which appeal to families.
- Urban rental apartments for families, although still uncommon, are beginning to emerge as millennials seek to maintain urban lifestyles even after having children. The main appeal is to those with insufficient cash to buy a home or those who want to lease in a maintenance-free neighborhood.
- Mixed-income and affordable housing can take any of the above forms. It generally serves those whose income is below $50,000. Affordable housing is a relatively new venture designed to provide socioeconomically disadvantaged families with the space they need at lower price points.
July 1, 2020 Realty News Report Copyright 2020
Photo: Camden Highland Village townhomes in Houston’s Inner Loop offer sizable dwellings appropriate for families.
File: Rental housing