Marco and his parents were her host family. When it comes to host families, you aren’t cut off from dating altogether, but dating one of the people you’re staying with is a no-no. First-year High school students do not need to live with people they are dating. Sorry not sorry, but if that was the intent from the beginning, that being Star and Marco dating, then the writing needed work to show that.
Encanto would have worked much better as a mini series instead of a film because so much happened in so little time, which resulted in the ending of the motion picture being unsatisfying.