Nearly 180,00 new units have been built in Garden State since 2020
Key takeaways
- New Jersey is poised for a banner year in housing production, a Rutgers University study suggests.
- The state has permitted 179,650 new units since 2020 and could end 2029 at 359,300.
- A Rutgers professor told Homes.com News that the coronavirus pandemic helped spur today’s explosion in condo and rental unit construction.
New Jersey is on pace to build more housing than it has seen in decades, thanks to a recent surge in new condominium and multifamily high-rises, a Rutgers University study suggests.
The study, published Wednesday, tallied how many housing units New Jersey governments have permitted, by decade, since the 1940s. In the 2010s, New Jersey OK’d 247,067 permits, according to the study. So far in the 2020s, the state has approved 179,650.
At the current rate, New Jersey will likely build 45% more housing in the 2020s than it did in the 2010s, said James Hughes, a planning and public policy professor at Rutgers who co-authored the study. Hughes’ research predicts New Jersey will finish 2020s with 359,300 permits — a figure the state hasn’t experienced since the 1980s.
The roughly 179,000 units approved so far this decade is partially due to the coronavirus outbreak, Hughes told Homes.com News. The pandemic quickly altered the U.S. economy, allowing real estate developers to secure construction loans quicker and at lower interest rates. Armed with more favorable rates, developers then built thousands of new condo and apartment units across New Jersey, he said.
State saw housing construction boom in the 1950s
To be sure, this decade wouldn’t be the state’s first housing production boom.
Hughes said New Jersey saw enormous production growth in the 1950s — when middle-class families left Philadelphia and New York City looking for more space to raise children in a single-family home. These days, New Jerseyans regularly commute to work in Philadelphia or New York and desire affordable housing close to public transportation.
The preference suggests “it’s going to be very hard to go back to what we were doing in the 1950s and 1960s,” Hughes said.
“New Jersey’s housing production roller coaster has been defined by long-term crests and falls since the 1940s — from the postwar golden age of homebuilding in the 1950s and 1960s to the prolonged slowdown that followed,” he said. “The increase in construction during the 2020s so far suggests a potential turning point that adds important context to ongoing policy discussions about housing supply in New Jersey.”
A prediction of increased housing bodes well for Gov. Mikie Sherrill and state lawmakers who say they’re working hard to address New Jersey’s severe housing shortage.
In February, Sherrill’s office released a report containing roughly 20 recommendations on how to ease the state’s housing woes. Earlier this month, Sherrill signed an executive order aimed at increasing housing production. Last year, state lawmakers debated passing a measure that would make it easier for developers to convert empty office towers into residential in an effort to increase housing.
“There’s a desire by the powers in Trenton that we at least maintain or stimulate more housing production,” Hughes said. “One of the sources of new housing has been obsolete office buildings. They have the land and utilities in place. It’s higher density housing, but policies like that can be very effective.”