NJ’s Housing-Affordability Problem Needs Urgent Attention From Nonprofits, Lawmakers

Housing costs in the Garden State continue to rise. So does the general cost of living.

New construction in Newark
New construction in Newark, where the cost of living is 7 percent higher than the state average. Photo: Shutterstock/Alysson M

It’s no secret that New Jersey is an expensive state in which to work, live and raise a family. The cost of living here is 15 percent higher than the national average, according to a March 2023 report published by the Council for Community and Economic Research. That’s not a number we should be proud of.

In terms of individual cities and towns, the cost of living in Newark is 7 percent higher than the state average and 23 percent higher than the national average, according to the report. On the other end of the spectrum, Vineland, in Cumberland County, has a cost of living 15 percent below the state average and 2 percent lower than the national average.

In addition to the rising cost of living in New Jersey, ever-increasing housing costs are an ongoing issue. Demand for housing persists, but higher mortgage interest rates make housing less affordable, with total home sales down 17.8 percent in 2022 from the previous year, according to a January 2023 report published by New Jersey Realtors. One silver lining, according to the report, is that mortgage rates declined steadily through January, falling to their lowest level since September 2022, which should boost affordability. But we still have a long way to go.

Regardless of mortgage rates, the cost of housing continues to rise, with the median sales price of a single-family home rising from $400,000 in January 2021 to $450,000 in January 2023, an increase of 12.5 percent. Townhouse and condo prices increased almost 15 percent, and adult communities saw a rise of almost 17 percent. Meanwhile, supply chain shortages and the rising costs of goods, including lumber needed to build and repair our homes, exacerbate already high housing costs.

Research has shown that affordable housing plays a critical role in building and sustaining strong and stable communities, that—along with the families that call them home—are essential to our state’s economy. 

[RELATED: Are Tiny Houses a Solution to the Housing Crisis in NJ?]

Covid-19 has had a tremendous social and economic impact on families in New Jersey. “One in six households spend 50 percent or more of their income on housing,” says Melissa Flynn, executive director of Raritan Valley Habitat for Humanity. 

Habitat for Humanity is a nonprofit organization helping families build and improve places to call home. Habitat homeowners help build their own homes alongside volunteers and pay an affordable mortgage, which helps them achieve the strength, stability and self-reliance they need to build a better life for themselves and their families. For families who may not qualify for a mortgage just yet, Flynn says, “we are kicking off a program called Almost Home, where families get help to prepare for their finances, improve their credit and gain the tools necessary to one day become homeowners.”

In addition to services provided by nonprofits such as Habitat for Humanity, there are numerous bills in the state Legislature tied to expanding affordable housing assistance, eviction protections and energy-efficiency programs. 

While housing affordability is a nagging and persistent challenge in the Garden State, and no one action or magic bullet will solve this problem, for many of us living here, with all of its challenges, it’s kind of a Jersey thing. 

Steve Adubato, PhD, is the author of five books including his latest, Lessons in Leadership. He is also an Emmy® Award–winning anchor on Thirteen/WNET (PBS) and NJ PBS. Check out steveadubato.org. Steve has appeared on CNN, FOX5 in NY and NBC’s Today Show, and his “Lessons in Leadership” video podcast with co-host Mary Gamba airs Sundays at 10 am on News 12+. Steve also provides executive leadership coaching and seminars for a variety of corporations and organizations both regionally and nationally. For more information, visit stand-deliver.com.

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