Published May 10, 2022
By Ashley Balcerzak

New Jersey severely lacks affordable housing, especially for those who need it most: For every 100 families earning extremely low incomes, the Garden State has only 31 affordable and available rentals — less than the national average and among the worst ratios in the Northeast, tied only with Delaware.

But no state in the country has an adequate supply of homes for those families making below the poverty line or up to 30% of their county’s median income. The U.S. needs another 7 million affordable units — and currently offers an average of 36 available homes for every 100 such families, according to the 2022 report "The Gap: A Shortage of Affordable Homes."

“There’s not a county in the U.S. today where a family earning minimum wage can afford to rent a two-bedroom at fair market rent,” said Staci Berger, president and CEO of the Housing and Community Development Network of New Jersey, a statewide association of community development corporations that released the report with the National Low Income Housing Coalition.

“It’s really hard to find a basic human right like shelter that is so otherwise unregulated, other than some guardrails that are hard to enforce,” Berger said. “It’s so market driven. Because there are not enough places for people to rent or purchase, the costs go up.”

Many factors have contributed to the crisis, which disproportionately affects people of color: historic underfunding of public assistance, lack of construction, skyrocketing housing costs paired with stagnating wages, and historically racist policies with effects lasting to this day, such as restrictive covenants, redlining and predatory lending.

Bianca Haynes-Barrett, a 41-year-old mother of four living in Elmwood Park, is experiencing the shortage firsthand as she scours Bergen County for a new home for her family — with no luck so far — as a deadline approaches for them to move out in roughly two months. Their landlord is selling the home, so the family agreed to move out June 30.

And she's finding the search challenging even though she has an advantage designed to expand the number of homes her family can afford: a housing choice voucher, also known as Section 8, that she can use in most Bergen County towns.

Because of inadequate funding, only one in four families that are eligible for housing vouchers actually receive the assistance, according to the Center on Budget and Policy Priorities, a Washington-based research group.

As vouchers became one of the major housing assistance programs — allowing families to move where they wanted as long as the landlord met certain criteria and passed inspections — in the 1980s, the government started to disinvest in or demolish subsidized complexes run by public agencies and didn’t replace affordable units that were lost.

Mismanagement and a lack of funding had created substandard living conditions in public housing complexes, and lawsuits at the time alleged that housing agencies failed to desegregate their public housing complexes, writes Eva Rosen in her book "The Voucher Promise."

A 1992 congressional report found that 86,000 units out of 1.3 million, or about 6% of public housing, were "severely distressed." Henry Cisneros, secretary of the Department of Housing and Urban Development in the Clinton administration, called for "the end of public housing as we know it" and said "the concentration of very low-income families in dense, high rise housing" was a central problem, Rosen wrote.

In addition, over the last decade New Jersey governors drained or diverted more than $300 million from the Affordable Housing Trust Fund, a pot of money intended to fund the construction of housing for low-income families, according to an analysis by NJ Spotlight.

If all families eligible for vouchers actually received them, 9 million people nationwide could be lifted out of poverty, according to a study from the Center on Poverty and Social Policy at Columbia University.

Hurdles abound
The voucher, a golden ticket that covers a portion of Haynes-Barrett's rent, essentially creates affordable housing in a market where rents would not otherwise be affordable for her on her $40,000 salary at Bio-Reference Laboratories, where she tracks COVID-19 PCR tests.

But simply possessing the voucher isn’t the same as finding affordable housing, and hurdles abound.

Landlords tell her they don’t take Section 8 — discrimination that is illegal under New Jersey state law, but a rule that state officials are lax in enforcing. Haynes-Barrett said she hasn’t reported these landlords to the state Attorney General’s Office because the clock is ticking — finding a new apartment is more urgently important to her than filling out complaint forms.

Her voucher can be used for a five-bedroom house, but larger apartments are difficult to find. The voucher also comes with lots of paperwork and restrictions — like those capping how much landlords can increase the rent each year— that many landlords don’t want to deal with.

“The amount of bureaucratic rigmarole people have to go through to secure housing help is mind-blowing,” Berger said. “Years ago it took four people who know the system well to cut through the red tape to help place a homeless person into a vacant house, and it still took us a week.”

Other landlords have questions about the program that are difficult for Haynes-Barrett to get answered. Her case agent is swamped with assignments, and it can take her two to three days to reach a person at the county housing authority.

That waiting period is “reasonable,” said Lynn Bartlett, executive director of the Housing Authority of Bergen County. The agency’s voucher division helps nearly 4,000 families with rental assistance, and specialists handle between 40 and 66 clients a month, she estimated.

But Haynes-Barrett's most frequent problem is the high cost of rent in New Jersey, especially at a time of rising inflation in a competitive market fueled by the end of the state's pandemic eviction moratorium.

During the pandemic, families who lost jobs or who lost the income of family members who died from COVID could no longer pay rent. A statewide eviction moratorium kept families housed temporarily, but the protection has since expired, even though many families are still not back on their feet and there's not enough public rental assistance to go around.

Landlords, many of whom went up to two years without receiving rent payments and were unable to evict their tenants, chose to sell their homes and get out of the business. Others decided to be more selective about future renters they accept. Those decisions, along with rising rental prices, have limited the available rental options for those with low incomes or poor credit scores.

New Jersey doesn’t have a statewide rent control ordinance, though about 100 towns have their own rules limiting how much a landlord can raise the rent, usually a percentage increase or a number tied to inflation. According to QuoteWizard, an online insurance brokerage, New Jersey one-bedroom rents on average increased 17% between 2021 and 2022 statewide.

“Bergen County is one of the most expensive areas in the state, and when you tack on broker fees and security deposits, I would be draining my entire savings just to move in,” Haynes-Barrett said.

For instance, Haynes-Barrett found a house in Paramus for $4,000 a month. Adding on the $6,000 security deposit and $4,000 broker fee, she would have to pay $10,000 up front, in addition to what she owes for the first month's rent upon moving in.

Bartlett, at the Housing Authority of Bergen County, said she is not aware of programs in the area that cover broker fees, and the few programs that help with security deposits run out of funding quickly.

Many available Bergen County homes are charging rents that are too high for someone with a voucher to use, as there are rent limits in the program, Bartlett said.

The U.S. Department of Housing and Urban Development, the federal agency that administers the program, “is working on ways to address [this issue], but most solutions require policy changes," she said.

“We have watched our leasing success rates plummet — first because there were no available units due to lockdown and limited turnover, then rent inflation post-eviction moratorium,” Bartlett said.

There are other factors increasing competition in a post-COVID-restrictions world, said Diane Yentel, president and CEO of the National Low Income Housing Coalition. Pent-up demand is being released, as young people who may have moved in with parents or doubled up during the pandemic are now looking for their own apartments. On top of that, since availability of single-family homes is at a historic low, higher-income renters are staying in the rental market because they can’t find homes to buy.

Haynes-Barrett said her family would love to buy a house, but inflated prices make it a “scary time to buy,” especially after she gave birth a few weeks ago. Their plan is to rent for another year, save up and try to secure an affordable loan.

“We just want an affordable place to live,” Haynes-Barrett said.

Racial housing gap
New Jersey is the home of historic affordable housing and civil rights cases that established the Mount Laurel doctrine, which declared that municipalities had an obligation to provide their “fair share” of housing for low- and moderate-income families.

But the road to produce that affordable housing has been rocky.

The state’s top court declared in 2015 that the statewide agency meant to oversee this process was “nonfunctioning.” As a result, municipalities would need to negotiate in Superior Court the numbers of affordable units they would be required to offer within a specific time period with the nonprofit Fair Share Housing Center, including proposed housing sites or developments that would contain the discounted apartments.

If they didn’t come to an agreement, towns would risk builder’s remedy lawsuits, which could leave developers, rather than the towns, to decide where affordable housing is placed.

“The vast majority of towns in New Jersey, absent of there being a legal requirement, will block affordable housing, and we know that because [former Gov. Chris] Christie largely suspended the enforcement of requirements, and guess what, towns blocked housing from being built,” said Adam Gordon, executive director of the Fair Share Housing Center.

Even under the best-case scenario, the process can take two to four years between reaching a settlement and actually building new units, he estimated. From the mid-1980s to 2014, New Jersey constructed 65,000 new affordable units. Adding up all municipality settlements should result in another 50,000 units being built, Gordon said, but calculating exactly how many have been completed is difficult because there isn’t one agency tracking all towns' progress.

“We’re so far behind where we need to be … we’re just starting to scratch the surface of the backlog from years ago, and meanwhile New Jersey is growing much more rapidly than anyone realized,” Gordon said.

Affordable housing typically means that a family is not spending more than a third of its household income on rent. Developers turn to tax credits and other financial incentives to keep rents at a level families can bear, constructing buildings that include income and rent thresholds.

Even if towns come to a deal with the Fair Share Housing Center and identify where affordable housing can be built, funds may not be available. To help address the problem, Gov. Phil Murphy proposed using $305 million in federal funds to help complete close to 50 fully affordable projects, or about 3,300 units, that haven’t yet been built due to financial constraints. The Legislature has not yet publicly released its appropriations bill, which needs to be signed by Murphy before July 1.

The lack of affordable housing is particularly stark for people of color, who have faced centuries of racist policies restricting their ability to own property.

The Institute for Social Justice, a Newark-based nonprofit working to end structural inequality, released a 2020 report, Erasing New Jersey’s Red Lines, that describes the history, starting with the legacy of slavery and its reverberations.

“With the possible exception of New York, New Jersey had the most severe slave code of the northern colonies,” according to a history of slavery published by the New Jersey Historical Commission. After New Jersey abolished slavery — the last northern state to do so — Black people were denied equal access to land ownership.

From the 1930s until the 1968 Fair Housing Act, the federal government used a process known as “redlining,” drawing red lines around communities of color labeling them too risky for federally insured mortgage loans.

In addition, Black veterans were denied homeownership opportunities under the GI Bill; fewer than 100 non-white veterans in New York and North Jersey received one of the 67,000 mortgages offered under the GI Bill.

Racially restrictive covenants were inserted into deeds, banning homes from being occupied by, sold to or leased to people of a certain race.

During the Great Recession, banks targeted Black neighborhoods with predatory lending schemes with exorbitant interest rates.

“These are structural issues — it’s not an issue of individual behavior,” said Nichole Nelson, a policy analyst at the Institute for Social Justice. “It’s about policies that have unfortunately disadvantaged Black and Latina New Jerseyans over time that created the results we see today.”

These historic and current barriers to homeownership are a major reason why New Jersey’s racial wealth gap is so stark — the median white family holds $322,500 in financial assets, compared with $17,700 for Black families, according to an analysis by the Institute for Social Justice.

In New Jersey, 75.9% of white families own homes, compared with 38.4% of Black families.

And for those in the rental market, 62% of low-income renters nationally who spend more than half their wages on rent are people of color, according to a CBPP analysis of census data.

Many factors still stand in the way of Black families building wealth through homeownership, and homeownership is generally more affordable in the long term than renting, according to the recent Institute for Social Justice report, "Black Homeownership Matters."

Black homeowners on average still face higher mortgage rates, fewer refinancing opportunities and less access to credit, as well as higher insurance premiums and higher property tax rates. Black families are more likely to have lenders deny home loan applications, and more likely to get predatory subprime loans, according to the study.

Available housing programs could be better targeted to help communities of color, and developers need more subsidies and land to build affordable units, Nelson said. Corporations prioritizing profits dominating the market make it more difficult for families or community nonprofits or developers to rehabilitate or build housing for lower-income families.

For instance, the rise of corporate investors purchasing residential homes is also leading to rapidly rising rents and barriers to affordable housing production in Newark, according to a May 2022 study by the Rutgers Law School Center on Law, Inequality and Metropolitan Equity.

In the Brick City — which is short some 16,000 affordable apartments for those who need them — close to half of residential sales between 2017 and 2021 were to institutional investors, particularly in majority Black neighborhoods.

“These largely anonymous outside companies now set neighborhood housing markets on terms that primarily benefit their investors,” wrote report authors David Troutt and Katherine Nelson. “There is very little incentive for a corporate landlord to do anything but maximize rents as high as they can go.”

Are you a Bergen County landlord in need of a tenant, or do you know of openings in the area for Haynes-Barrett and her family? Email [email protected].

Where should I start when looking for affordable housing?

• New Jersey Housing Resource Center is a searchable registry of affordable units from the state agency, the Housing and Mortgage Finance Agency.
• HousingHelpNJ.org has a resource library where users can find lists of nonprofits and agencies in their county to call for assistance.
• Find out whether your town, city or county has a housing authority, and call to ask about available public assistance or if affordable housing developments are taking applications.
• Bergen County is opening its Section 8 waiting list from May 16 to May 20, 2022. Apply at habcnj.org.