South Florida Sun Sentinel
WWR Article Summary (tl;dr) A 569-city survey of 21,000 renters by RentCafe, an apartment search website, found that one out of three renters nationally want to “upsize” their apartments for business reasons or family growth.
Many renters are ramping up their searches for bigger places after COVID-19 forced them to work more than a year at home.
Although workers are gradually returning to their regular offices this summer, many are still being allowed to work at home full time or for portions of their workweeks.
Since the pandemic struck down the economy in March of last year, some are finding that temporary needs for extra space are becoming permanent. Moreover, the allure of starting a new business from home has grown, creating a new reason for tenants to find more space.
“It does not surprise me that you see people renting bigger apartments,’’ said Ken H. Johnson, a real estate economist and professor at Florida Atlantic University’s College of Business. “lnstead of one bedroom, they go for two; instead of two they go for three.”
A 569-city survey of 21,000 renters by RentCafe, an apartment search website, found that one out of three renters nationally want to “upsize” their apartments for business reasons or family growth.
Both apply to Susana Gonzalez Perez and her family of five. They are gearing up for a move to South Florida this fall from Palo Alto, Calif. She is a researcher and university lecturer. Her husband, David, is an executive with a startup technology company. They have three daughters.
“I need a dedicated space for working from home,” she said. “Apart from this, it has been really hard to have three children at home during the pandemic, homeschooling. I hope that it is not going to happen again this year. But we have learnt that it is important for each of the girls to have their own space.”
Even with a rented four-bedroom home in California, two of the girls shared a single bedroom. That’s because she and her husband “have a dedicated office at home shared by both of us. It is not a good arrangement because it is complicated to share when you have, for example, Zoom meetings.”
“That is exactly what we are looking for in South Florida — more space for everybody,” Gonzalez Perez said.
But the family won’t be buying a home when they arrive in Florida — homes are too pricey.
“We were renters in the Bay Area and we will continue to be here,” she said. “We have considered buying, but we think that the prices are too high for us right now, perhaps artificially high. I am not sure if it is just something that it is happening as people want bigger homes as they are spending more time there.”
Trending toward bigger spaces
The family’s needs fit a profile identified by RentCafe, which sought to identify future housing needs as the nation’s businesses try to find a new normal for their work forces while the pandemic lingers.
“With our survey we wanted to understand just how big the need for extra space is, regardless of whether it’s used for home-office or for the family,” said Florentina Sarac, editor and researcher for RentCafé.
Besides finding that 35% of the renters interviewed want more space, it also found that 60% of studio tenants want an extra room, while 40% of renters living in a one-bedroom apartment want an upgrade.
“It’s becoming clear that, no matter the purpose, apartment space itself has become a much wanted ‘amenity’ and the (COVID-19) lockdown period may have brought that out more evidently than before,” she said.
The cost of moving around varies from city to city, according to the survey, which used a weighted average that took into account all types of apartments, from studios to three-bedrooms. The value obtained is one that renters can expect to pay or save.
A rough cost of upgrading in Miami would be an additional $370 in monthly rent only, a spokesman said, regardless of the size apartment an individual is moving from. But a move from Miami to Coconut Creek and getting an extra bedroom would cost $255 more in rent.
In a number of South Florida cities, builders have started to adjust their projects to cover the needs of both growing families and heads of households who want to work from home.
Art Falcone, CEO and founder of the Falcone Group and Encore Capital Management, said The Rise in downtown Fort Lauderdale and The Rise at Plantation Walk in suburban Plantation contain hundreds of one- to three-bedroom apartments packed with luxury amenities such as gourmet kitchens, pool decks, cabanas and controlled access parking garages.
“We have seen quite a large pickup in rental activity in our inner cores of downtown Miami and downtown Fort Lauderdale in the last six months due to the number of people coming here from all over the nation,” he said.
For extra sums depending on the size, independent work spaces are available at The Rise in Fort Lauderdale and are included for a planned sister project at the Miami World Center in Miami.
“We’ve been designing that way for quite some time now,” Falcone said.
Some fully employed people who have worked at home are starting new businesses there, said Siri Terjesen, an associate dean and professor of entrepreneurship at Florida Atlantic University’s College of Business.
“They were getting their health insurance and other benefits, but they know how to manage and for one reason or another they can’t or don’t want to exercise that entrepreneurial spirit through their full-time employment,” she said. “So they’re starting a business on the side”
Those new enterprises may or may not be related to their main line of work: it could be flipping houses or selling things online.
Whatever their intentions, South Floridians now in the rental market had better hurry, industry experts say.
Carolina Gerdts, senior vice president of Miami-based Related ISG, said available homes and condos for rent are in thin supply from Palm Beach to Miami-Dade counties, with properties listed in each county for rent numbering in low double or triple digits.
“In Palm Beach right now active there are 35 rentals,” she said. “In Broward there’s 348. That’s nothing.”
Gerdts said people are angling toward rental communities where there’s more space and a relative assurance that a complex won’t be sold, a move that could drive up rents under new owners.
Two and three-bedroom apartments are being snapped up all over the region, said Sasha Ezquerra, who with her partner Santiago Illia operates Apartment Lease-Up Experts in Fort Lauderdale.
Ezquerra said inbound migrants from New York think nothing of plunking down $3,500 a month for a three-bedroom as they can’t buy space anywhere near that size back home.
“For New Yorkers, $3,500 is joke for them,” she said. “In New York you can get a studio for $3,500. That number doesn’t intimidate them at all.”
Demand for three-bedrooms is even intensifying the suburbs, said Daryl Spradley, senior vice president of Charles Wayne Consulting Inc. in Maitland, a market intelligence firm with clients in Central and South Florida.
“Part of that demand is triggered by families with children who know where they want to buy a house, or they already have one under construction,” he said.
“Such a family will probably end up renting a three-bedroom and they’ll live there for a while, as their house is being constructed,” he added.
“Another scenario is they’ll stay for a year, then buy a house in the neighborhood they want to live in, as that they don’t want their children to have to switch schools after a move.”
Distributed by Tribune Content Agency, LLC.