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Low-Income Families May Wait Decades for Affordable Housing
April 12, 2021

Low-Income Families May Wait Decades for Affordable Housing

by The CE Shop Team

Newark’s Affordable Housing Crisis Isn’t Getting Better

Newark has a serious problem on its hands, and it doesn’t look like it will be fixed anytime soon. The state’s lack of affordable housing has created a pile up of struggling low-income families. If Newark was to start meeting the resident’s current needs, which would require finding around 16,000 affordable housing units, the process would take over 20 years. However, throughout this time, the number of low-income families would continue to rise and the signs of deep economic scarring will become impossible to hide.

Newark’s Severe Lack of Housing Affordability

Newark’s Affordable Housing Crisis Isn’t Getting Better

Newark, like many cities across the country, is undergoing a severe housing affordability crisis that the state can no longer ignore. The Rutgers Center on Law, Inequality and Metropolitan Equity (CLiME) has released an enlightening report regarding this issue. Found in the report, 60% of Newark's residents, about 104,000 people, spend one-third of their income on housing, and one-third of residents spend half of their incomes on rent. Newark’s median renter household income is only $30,000, making it one of the poorest cities in the country.

To add to that, four out of five residents are renters. Using the benchmark that households should pay only a third of their incomes in rent, affordable rent in Newark is $763. Unfortunately, the median market rent is closer to $1,100 a month.

The affordability gap is largest for units with at least two bedrooms. CLiME found that 37% of studios and one-bedrooms are affordable to typical renter households compared to just 25% of two-bedroom units and 22% of larger units. The city’s smaller units are more affordable because of the extra support they receive from rental subsidy programs that have largely ignored families' need for more space.

What Issues Does Newark Face in Solving Affordable Housing?

Two factors inflate competition among the Garden State’s low-income residents:

  1. Very little affordable housing is being developed. As developer interest returns post-pandemic, most of the new housing projects in New Jersey’s cities are higher-end units. Developers argue that construction costs are too high to build affordable units, so they would lose money on these projects. Without generous subsidies from the state, developers don’t have an incentive to break ground on affordable developments. This issue sounds easy enough to fix, but subsidies for housing are scarce at the moment.
  2. Affordability is often mismeasured by federal subsidy programs, especially for very low-income households, and overcounts the amount of affordable housing. There are a variety of variables that can influence a household’s income. Federal programs often don’t account for cost of living inequality as well as understanding affordable housing units that can actually meet family needs. The current standards used often create scenarios of affordable housing that is already out of reach for low-income Newarkers.

When the eviction moratorium eventually ends, this housing crisis will truly come to light, forcing many struggling families to risk displacement.

Is Newark Working on Solutions for This Crisis?

Newark is working with building developers on new projects to fulfill this affordable housing need, but that comes with some flexibility on the city’s end. A new development plan is in the works that would bring additional residential and medical uses to Newark’s Fairmount neighborhood. The city council is set to vote on whether or not they’ll approve a tax abatement for this project that would exempt the building from taxes for the next three decades. The new building is expected to include 78 residential units and an 8,000-square-foot medical center. All of the residential units would be affordable units, with 16 of the units being reserved for tenants with special needs as they would have easy access to the building’s medical center.

How You Can Help Your Fellow Newarkers

If you witness housing discrimination or know a victim of housing discrimination, contact the Housing Authority for the city of Newark. Stay vigilant in your community, and be a helping hand for those that need it. You can offer your support by supplying struggling renters or homeowners with information on aid that they can receive from both state and federal programs.

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