During the economic downturn, home building nationwide and in New Jersey slowed, but New Jersey Builders Association CEO Timothy Touhey told NJ Today Managing Editor Mike Schneider that the newest numbers for home building are encouraging after the industry faced its “most dramatic recession and depression.”
Expediting the foreclosure process will help construction projects, according to Touhey. He said members of the legislature passed a bill that if Gov. Chris Christie signs would expedite foreclosures on abandoned properties, meaning no one is living in them. “By getting that product out quicker to the marketplace, it gets rid of that shadow inventory, allows for new construction because you don’t have pent up demand,” he said.
Touhey said central and northern New Jersey have had a major resurgence in home building. “I think it has to do with the infrastructure, transportation. The New York job market has spilled into the New Jersey job market, makes it more attractive. We still have strong incomes,” he said. “Those make Central/North Jersey functional.”
The conditions in Manhattan are an indicator for the New Jersey market, according to Touhey, because the Garden State has been tied to New York as it relates to jobs and the financial industry. Since the financial industry has done well in the past couple years, more capital has made its way into New Jersey.
There has been a 9 percent increase in for sale properties in New Jersey. Touhey estimates that permits will be between 15,000 and 16,000, up from last year’s 12,000. He said multi-family rental housing is healthy and competitive and makes up about 65 percent of the total permits.
Home builders adapt to the changing times, according to Touhey. “I think the home building industry’s always creative as it relates to where the market is and depending on what the market wants, we build to it,” he said. “And I think that the home builders have been very creative as it relates to whether it’s detached housing, looking at people moving back at home, generational type housing.”
Financing new home building projects is a challenge, Touhey said. “What’s really happened is that it’s very difficult to get financing for home ownership and that has changed because of the meltdown of the financial industry,” he said. “It’s a challenge we need to face and get over.”