Op-Ed: How New Jersey can break free of its housing shortage
The Consumer Choice Center's Policy Director critiques New Jersey's housing market and what its future could look like.
Submitted by David Clement, Policy Director of the Consumer Choice Center in Washington, D.C. Opinions expressed in the submission are the author’s alone.
New Jersey’s housing market is broken in the most obvious way: there aren’t enough homes. Everything else—the eye-watering rents, the cost-burdened families, the young professionals fleeing to cheaper states—follows from that fact alone. And yet, Trenton’s preferred policy solutions have almost nothing to do with building more units.
The numbers are worth sitting with for a moment. Half of New Jersey renters are spending over 30% of their income on housing, a major red flag for household budgets. Among the state’s lowest-income renters, that figure climbs to 74%. Average rents hover around $2,500 a month statewide, even higher in the North Jersey counties bleeding into the New York metro area. The rental vacancy rate sits at a very low 3.6%.
There is no slack in this system, meaning prices can only go up.
The root cause is a chronic undersupply. Housing production has simply not kept pace with demand, throttled for decades by restrictive zoning, permitting delays, and construction costs that make many projects financially unviable before a single shovel hits the ground. Whatever policymakers do next has to address that undersupply directly. Anything else is political theater.
Case in point: the current legislative energy in New Jersey to implement restrictions on pricing algorithms—software tools some landlords use to set rents based on market data. Jersey City and Hoboken have already enacted restrictions on such platforms because the words “algorithm” and “AI” poll quite poorly, serving as effective scapegoats for the lack of housing supply. Governor Sherrill has pledged to sign statewide legislation if it reaches her desk.
The case against algorithmic pricing rests on the assumption that these tools artificially inflate rents. But rent is high in New Jersey because housing is scarce—not because of the software a landlord uses to price it. Jersey City enacted its restrictions and remains one of the most expensive rental markets in the country. The ban has no effect.
There’s a more overlooked argument in favor of these platforms, too. When pricing is driven by market data rather than the whims or biases of individual landlords, you get a more equitable, less arbitrary system. That matters for the small landlord, the immigrant property owner managing a handful of units, the retiree renting out a second home, who doesn’t have a property management team and relies on digital tools to stay competitive.
Genuine reforms are less politically satisfying but actually work. Housing gets cheaper when you allow more of it to be built, and cutting down on exclusionary zoning rules, mandatory parking minimums, low-density ceilings, and permitting wait times is the quickest way to do this. Doing the opposite has made New Jersey one of the most supply-constrained states in the country.
Development approvals in many municipalities drag on for years, with costs that compound and eventually land on tenants. Clearer timelines, modernized permitting systems, and fewer duplicative reviews would change that calculus.
The evidence from other jurisdictions is hard to argue with. Auckland rewrote its land-use rules in 2016 to allow mid- and higher-density homes across most residential neighborhoods, sparking a wave of new construction and noticeably slower rent growth than the rest of New Zealand. Minneapolis ended single-family-only zoning citywide in 2018 and has since seen lower rents relative to comparable American cities.
Austin added roughly 50,000 rental units in 2023 and 2024 alone—one of the largest supply expansions among major American cities—and has watched rents fall more than 20% from their peak. The pattern is pretty predictable—build more, pay less.
New Jersey also has one advantage it hasn’t fully pressed. With a robust NJ Transit commuter rail network connecting communities across the state to New York and Philadelphia, the Garden State is uniquely positioned to embrace transit-oriented development—allowing greater housing density near train stations to reduce transportation costs for families, support local businesses, and maximize existing infrastructure. Research from the Regional Plan Association found that less than 22% of New Jersey’s housing stock is located in areas with the density needed to sustain viable transit services, leaving enormous room to grow. Mixed-income housing near transit can expand supply while ensuring workforce affordability.
With the playbook already mapped out by other jurisdictions, there is no need to reinvent the wheel. Employers depend on attainable housing to attract and retain workers, and overregulation that discourages housing investment risks pushing development—and jobs—to neighboring states. The only way out of New Jersey’s housing crisis is to build, not search for new things to ban.
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David Clement is policy director of the Consumer Choice Center and is based out of Oakville, Ontario.
David holds a BA in Political Science and an MA in International Relations from Wilfrid Laurier University. Previously, David was the Research Assistant to the Canada Research Chair in International Human Rights.
David has been regularly featured on the CBC, Global News, The Toronto Star and various other major Canadian news outlets.