Housing Prices Remain High In NJ As Lawmakers Seek Solutions

NEW JERSEY — Experts and advocates say a lack of housing supply has contributed to rising rent prices in the Garden State, with a shortage of affordable units making it difficult for low-income residents to keep a roof over their heads.

As officials look to address the skyrocketing cost of housing in NJ, the Assembly Housing Committee held a hearing Monday to discuss the cause and the impact of rising rent prices.

In New Jersey, the median rent price across the board is $2,500 — 19 percent higher than the national median, according to Zillow.

Assemblywoman Yvonne Lopez, who chairs the Housing Committee, cited Census data to say that over 50 percent of New Jersey renters are "cost burdened," meaning they spend more than 30 percent of income on rent.

"In certain parts of the state, tenants are facing year-over-year increases of 20 to even 30 percent in some cases," said Lopez, a Democrat who represents parts of Middlesex County, at a session on Monday.

And those rent increases far outpace any pay bumps that tenants have seen in recent years, advocates said — meaning those cost burdened renters are more likely to experience eviction, or have to take money out of their monthly food budget.

Carl Gershenson, director of Princeton University's Eviction Lab, said these increases are "simply not sustainable." Gershenson said that in 2021, households making less than $30,000 a year had less than $400 left in their pockets after paying their rent to try and make ends meet.

What Is Driving Up Prices?

Some speakers pointed to a lack of supply to meet the need for housing in the state, making the market much more competitive and driving prices up.

Linlin Liang, a principal associate for the Pew Charitable Trusts’ housing policy initiative, said New Jersey's housing inventory is less than half of it was in 2018. What's more, she said, the median rent cost has risen 36 percent between 2017 and 2024 — 6 percent higher than the national average.

"This surge in rent is largely due to low vacancy rates, giving landlords more flexibility to raise rent with fewer options available to tenants," said Liang.

Others addressed how building and maintaining apartments has become more expensive for landlords and developers. David Brogan of the New Jersey Apartment Association saying that costs have been rising for labor, utilities, materials, and insurance, as well as for property taxes.

"I think it's important to understand the housing market as a whole," he said. "For the past five years, everything that goes into operating, maintaining and improving a building has gone up in price."

What Can Be Done?

Brogan suggested that New Jersey lawmakers could increase funding for the State Rental Assistance Program, and said more also needs to be done to address an affordable housing shortage — with 150,000 to 200,000 more affordable units needed just to meet demand. He also mentioned the differences in zoning laws among New Jersey's 500-plus municipalities making it difficult for some developers to get going on new projects.

"There is truly a housing shortage," he said. "If we can put more resources towards housing and eliminate some of the barriers at the local level, I think you'll see more development going forward."

Gershenson also mentioned how municipal regulations can hamper the construction of affordable housing.

"While we must absolutely focus on supporting low-income renters with targeted programs, it's just as imperative that we don't step on our own feet by blocking the construction of market-rate development through overly restrictive zoning laws and building codes," he said.

Gershenson also suggested expanding incentives to build new homes near bus and train stations, allowing renters to have reliable transportation to and from their jobs.

Matthew Hersh, director of policy and advocacy at the Housing and Community Development Network of New Jersey, also suggested that an extra 4 percent tax on the sale of more expensive homes could bring revenue in to the state's Affordable Housing Trust Fund.