N.J. Rental Costs Among Highest in the Nation

Star Ledger / Sarah Portlock

A household in New Jersey must earn at least $51,044 annually - the fifth highest amount in the nation - to be able to afford rent and utilities for a "safe and modest" two-bedroom rental property, according to a study released yesterday.

Statewide, a typical renter earns about $32,905, according to the report, which was released by two housing advocacy groups. The fair market rent for a two-bedroom apartment in New Jersey is $1,276, according to the U.S. Department of Housing and Urban Development, and the report found New Jersey families are paying much more than the recommended 30 percent of income on housing and utilities.

The most expensive counties are Bergen and Passaic, where renters must earn $59,760 annually, a figure that is up 72 percent since 2000. The least expensive county was Cape May, where workers need to earn $37,960, up 47 percent, the report found.

"This data only emphasizes the need for more affordable home choices in our state," said Diane Sterner, executive director for the Trenton-based Housing and Community Development Network, which released the report with the Washington, D.C.-based National Low Income Housing Coalition. The data is from various federal agencies, including the U.S. Census Bureau and the Bureau of Labor Statistics.

Factors like high unemployment, falling wages, and low rental vacancies have contributed to the affordable housing crisis, the report said. Housing stock has shrunk as more people look to rent instead of buy and because many units were upgraded or converted to condos during the boom years.

"How can we expect New Jersey's economy to bounce back when its workforce can't afford to live here?," Sterner asked. "In order to move our economy forward, we need to create homes and jobs in environmentally appropriate places with access to transit."

The increasing costs also affect landlords who face financial and regulatory burdens to manage apartment buildings.

"This report re-emphasizes the need for comprehensive, statewide housing policy reform," said Conor Fennessy, vice president of governmental affairs for the New Jersey Apartment Association. "Because of the extreme regulatory burdens in New Jersey, our state has become an expensive place not just to live and work, but also own and professionally manage multi-family rental housing."

Justin Alvarez knows the renters' burden well. Each month, he pays $620 more than the recommended amount for his $50,000 salary to live in a small studio in Jersey City that he shares with his girlfriend, who is in medical school, plus their dog and cat. The couple considered looking at more affordable units, but the apartment is in the best possible location for their work.

"It's a tight fit, but we get by," he said. "It's always nicer (to have more space), especially when you have guests, but we are trying to save money as opposed to living paycheck to paycheck."