An ambitious plan to address New Jersey’s housing shortage, released Tuesday by Gov. Mikie Sherrill, forecasts the need for a pace of residential construction not seen in 50 years.
The governor’s Housing Governing Council reported that an annual average of 35,000 to 41,000 housing units would be needed over the next 10 years to close the gap.
Only in the boom years of 1970 to 1980 did housing unit growth come close – with the state adding an average of 38,000 housing units a year, according to decennial census statistics. The annual average from 2010 to 2020 was 21,000 new housing units a year.
The 41-page plan, “Housing Strategy & Progress Report,” was ordered by Sherrill shortly after becoming governor this year.
“I continue to hear the same concerns: people are struggling to keep up with rising housing costs,” Sherrill said in the report’s introduction. “Young people wonder whether they can afford to stay in the state they love. Parents like me worry that our children will have to move away. Seniors fear they will be priced out of the communities they helped build.”
The report notes: “Too many families, especially families of color, remain locked out of homeownership or struggle to find affordable rentals.”
A key component of the plan is to open state land for residential development and add between 37,200 and 42,800 housing units.
The report advocates using 800 acres of New Jersey Transit property and an additional 2,300 acres of state property that may be suitable for housing development.
Government bureaucracy for permitting and development approvals will also be targeted. It can take three to five years to build housing in New Jersey, with more involved projects taking longer.
“Complexity is a reality of the state’s current development process,” the report contends.
Land-use rules and outdated policies may need revision to promote housing construction, the report suggests.
Funding for down payment assistance should be increased to help 3,000 first-time and first-generation homebuyers, the report states.
New Jersey’s current inventory of affordable housing needs to be preserved, the report says, and the state should prevent the loss of affordability controls or having the affordable housing fall into disrepair.
A perennial New Jersey problem, property taxes, also comes up in the report.
“As home values have increased faster than wages in New Jersey, increases in property taxes have made it harder for people to afford to stay in New Jersey. Property taxes rose by an average of $475 last year.”
“In a state where the average home price is well above $500,000, rising home prices have further pushed homeownership out of reach. The average payment in New Jersey is now nearly $4,000 per month on a typical home and has almost doubled in the last five years,” according to the report.
Workforce and affordable housing are emphasized throughout the report. New Jersey needs more townhouses, duplexes and other starter homes, the report says.
“The (Sherrill) administration will focus on policies and co-investments that help New Jersey’s teachers and nurses, laborers and skilled workers, police officers and firefighters, live near work and afford that first home,” the report states.
