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Taking the long view on New Jersey’s housing affordability

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By Stephen Malpezzi, April 29, 2017

Two weeks ago we took a broad look at housing “affordability” at Rutgers’ BlogˑRE.  It surely surprised very few readers that we found that residents of New Jersey – and our Connecticut and New York neighbors – spend a lot on housing, especially on rents.  Exhibit 2 from that previous post showed that New Jersey ranked number 5 in median monthly gross rents ($1190).  Our tri-state neighbors, New York ( $1120, ranked #7) and Connecticut ($1070,(ranked #10) were also high.

In that previous post we promised to dig deeper, and produce a series of blog entries that explored the potential effectiveness of some proposed solutions to the high cost of housing in New Jersey and other states. Today we will examine rent controls, government regulation of rents in the private rental market. When rents are high and/or rising, simply legislating lower rents and/or slower increases has an obvious superficial appeal.  It’s a simple and direct approach, at least in theory. Unfortunately, as we will see, rent control turns out to be far from simple or direct and practice.

One reason we chose rent control as our first candidate housing policy for study is that about 120 New Jersey jurisdictions already regulate rents in some manner. Given recent reports of rapidly rising rents, a number of jurisdictions in New Jersey and elsewhere are actively discussing strengthening existing rent controls, or instituting them where they don’t yet exist. A few places that have recently relaxed some rent regulations, including my home state of Massachusetts as well as Newark, are debating the pros and cons of re-regulating. An overview articles by Teresa Wiltz, several articles on Newark by Karen Yi and Naomi Nix, reportage on the Boston debate by Pamela Ferdinand, debates in Glassboro covered by Carly Romalino, are examples any Internet search will quickly turn up; the debates in California alone are too numerous to catalog here.

(for more of the article click on the following link)

www.rutgersrealestate.com