How Developers Are Catering to Would-Be Homeowners With Rental Amenities

"Families are choosing to rent for the foreseeable future — some out of necessity, others for amenities.

In the traditional trajectory of living patterns, city dwellers tend to rent until they have children and continue to lease through their preschool years. Eventually, in pursuit of the classic American dream of owning a home, they buy within their city or decamp to the suburbs.

Now, that’s not as much of a norm.

Around the United States, from New York and Philadelphia to Miami, Dallas and beyond, families are choosing to rent for the foreseeable future — some out of necessity, others for amenities. A housing shortage and high interest rates have frozen would-be buyers in place, but they can also enjoy the relief from the headaches of homeownership, like maintenance.

“Renting can also be a lifestyle choice. Renting offers a lower commitment with more financial freedom, and renters often don’t have to worry about maintenance or yard work, which can eat into precious family time,” said Orphe Divounguy, a senior economist with Zillow, the real estate research and marketplace company

The typical mortgage payment is currently 104 percent higher than it was before the pandemic, according to Zillow. And though that payment dropped 2.9 percent this August, compared with August 2023, and rents rose 3.5 percent for the same period, renting may be a more viable option, because the hurdle of saving up for a down payment for some families is “simply too high,” Mr. Divounguy said.

Toni Gary, 52, a vendor manager, pays $2,150 a month for her three-bedroom townhouse in Oxenfree Princeton, a rental community of 408 single-family homes and townhouses in Princeton, Texas. She and her young adult son have been there since June after living in rentals nearby.

“I had not considered buying because of the huge upfront cost. I also didn’t want to be tied down to a home,” Ms. Gary said. “The maintenance and repairs are all handled in-house, which is a huge load off of me. Plus, I get to save my earnings and invest them wherever I feel is best.”

Developers are tapping into the confluence of high interests on mortgages, the need for large apartments to accommodate families and the desire for upscale living.

The gap between rental and condo buildings with respect to aesthetics and amenities has closed within the last decade, making renting more appealing to luxury seekers, said Jonathan Miller, the president and chief executive of the real estate appraisal and consulting firm Miller Samuel.

“There used to be a distinct difference with condos being much nicer and offering you more. Now, there’s an amenity war between rentals and condos, and what you get is comparable,” he said. “The finishes and appliances in rentals have also gotten more high-end, and many have notable designers behind them.”

In Chicago, One Bennett Park, developed by Related Rentals and designed by Robert A.M. Stern Architects, offers a children’s room with a kitchen, a terrace with a pool and private access to a children’s playground in the adjoining Bennett Park.

In New York, the architect Annabelle Selldorf designed One Domino Square on Williamsburg’s waterfront, which saw move-ins start in June. The building has condos and rentals and features outdoor spaces with abundant trees, indoor and outdoor swimming pools and a large kid’s playroom.

Residents have direct access to Domino Square, a public plaza that hosts farmers’ markets and has a waterfront ice skating rink during the winter.

In Philadelphia, One Thousand One, located on the edge of Center City, debuted in July with 630 units; an additional 800 will open within four to five years, said Michael Pestronk, the co-founder and chief executive of Post Brothers, based in Philadelphia, the building’s developer. In addition to a playroom, the property has a 20,000-square-foot outdoor playground with a 1972 Cessna 150 seaplane as the centerpiece and a periphery of rubberized tracks where young children can ride bicycles.

Countrywide, Related Rentals has multiple buildings that are designed with families in mind, according said the division’s executive vice president, Chris Schmidt.

The Easton, on Manhattan’s Upper East Side, has a 3,700-square-foot kids’ club with a terrace and a ’tween room with soundproof rooms for music lessons, an area with desks for tutoring sessions and an arcade. The building has a waiting list of between 20 and 30 people who want to lease a three-or four-bedroom apartment.

With so many families, the rental buildings are becoming strong communities. Nancy McAndrews, 44, a language service provider, has lived in a two-bedroom apartment in the Piazza in Philadelphia’s North Liberties neighborhood, since 2017.

The community has two pool clubs and a children’s playground, perfect for her 9-year-old daughter, Arabella.

“Arabella has made so many friends here. They hang out at the pools, the playground and at each other’s apartments,” Ms. McAndrews said. “It’s like we are all one big family, and that’s why we don’t want to leave.”" [1]

1. How Developers Are Catering to Would-Be Homeowners With Rental Amenities. Vora, Shivani.  New York Times (Online) New York Times Company. Oct 22, 2024.