Justin Auciello: The New Wave Planner

On gentrification and digital

Look around your hamlet, village, town, city.

Unless you live in an Utopian world (and sorry, I seek authenticity, not a sterile, perfect environment), odds are that there’s a section of your community that is struggling and rough around the edges, yet is still probably populated by a hearty bunch of people that cherish their neighborhood and are weary of any outside influence. Perhaps they’re longtime residents or recent migrants who relish the low rents, realness of the surroundings, and the beauty of distress.

To them, “progress” is a dirty world.

They’ll say, “How is it progress if you’re destroying my neighborhood and displacing me for the sake of shiny new buildings, young families with expensive strollers, and a cafes serving three dollar cups of coffee?”

They have a point, but…

For a municipality seeking reinvention, progress is defined as a new image, an influx of tax money into the coffers, and the possibility of becoming a local destination. Politically, it’s a winner, as it’s an ongoing story for the media, and revitalization is generally viewed by the community as a wise process.

If you haven’t seen it in your town or experienced it in your immediate neighborhood, you’ve certainly heard of it. It’s called gentrification, defined as just as I’ve explained it: a multitude of forces meshing together to transform a neighborhood.

Transforming old to new. Decay to vibrancy. Poor to rich. Again, who’s to say that “old” and “decay” are not aesthetics that some people love. They’re clearly subjective, but to the establishment, they both stand in the way of progress.

Without going into a detailed lecture about post World War II American life (cheap land, early suburbs, the construction of the interstate highway system, jobs and shopping centers chasing the population, and the gradual, sad decline of urban centers—once the engines of life), the stage for urban reclamation was set even before the first families started fleeing for the suburbs over fifty years ago.

However, people have been moving back to cities in droves in recent years, and per capita income has been expanding. Artists, bohemians, and the rest of the alternative culture have been back for decades (just look at Soho in the 1960s)—or perhaps never left—but in the past 10 to 15 years, cities have been morphing, shedding off the “depressed” skin of the past, and embracing hopes of a grand future. They’ve become entrepreneurial, competing with each other—and in larger cities like New York, competing internally—and attempting to re-brand themselves as meccas, where people can live, work, and play in peace and harmony.

Although the last paragraph was written with a bit of my tongue in my cheek (“peace and harmony,” for example, is a highly subjective term), Joe Q. Public will rarely view a urban revitalization as a bad thing.  The denizens of the previously “depressed” neighborhood, who have been summarily displaced from their homes, may not share the same sentiments, of course, and as fighters, will extol the evils of gentrification.

Alas, I’m not writing a post to distill the upsides/downsides of gentrification. (You be the judge.) The overall theme of this blog is innovation, change, and emerging technologies in the planning process—although I don’t necessarily think change is always the best route to achieve a goal—so the next post will review how a few communities are leveraging new media to achieve their progress goals.

Quite exciting.

Related posts on The New Wave Planner:

A Win For Urban Planning: Supermarkets Potentially On Their Way To New Jersey Cities

Innovation Is Now King, And It’s Perfectly Parallel With Obama’s Urban Policy Goals

A Vote For The New Jersey Economic Stimulus Act Of 2009 Is A Vote For Smart Growth And Economic Development

Backyard Chicken Coops? Urban Farming? There’s A Silver Lining To The Recession

NYC Planners: Zoning Bonuses Will Spur Healthy Eating And Economic Development

Once Again, The Baby Boomers Are Changing Housing

Save “Jersey Fresh” As We Know It

Save Our Sprawl? Evidence Suggests A Smart Growth Future

Low density housing, complete reliance on the automobile, isolation from goods and services, lack of recreational choices, and dull culture—all sprawl traits.

High density housing, multimodal transit choices, immersion in goods and services, overflowing recreational choices, and vibrancy—all urban traits.

Put the two traits side-by-side, show to one of my peers (highly educated, late 20s/early 30s, Northeast born-and-raised), and what will s/he probably pick as more desirable?

Without hesitation, the urban lifestyle.

It’s not just anecdotal evidence.

In a recently released report, Emerging Trends in Real Estate 2010, prepared by the Urban Land Institute and PriceWaterhouseCoopers, insight gleaned from almost 1,000 real estate industry professionals suggests that the future is bright for smart growth, while “sprawl investment” is on the decline. (Even though the overall tone of the report is gloomy for real estate as a whole.) This finding is consistent with recent data.

In an April 2009 NRDC post, Kaid Benfield cites a 2007 National Association of Realtors survey of registered voters that found:

• 57% agree that “business and homes should be built closer together” so stores and shops are within walking distance;

• 61% agree that new home construction should be limited in outlying areas and encouraged in very urban areas;

• 81% want to redevelop older areas rather than building new;

• 83% support “building communities where people can walk places and use their cars less”; and,

• 88% support more public transportation.

In the same post, Benfield continues:

Arthur C. (Chris) Nelson, now at the University of Utah, and a scholar who knows more about these things than anyone else I know, has examined homebuyer preference surveys.  Nelson reports that fully three-fourths of Americans now prefer either attached housing (apartments, condos, townhouses) or homes on small lots of approximately one sixth of an acre or smaller.  25 percent express a preference for homes on larger lots above one sixth of an acre in size.

If the anti-sprawl sentiment continues (evidence does not suggest otherwise), expect a surge of density in our future, as the post World War II suburban boom—lasting over 60 years—may see a quick death, thanks to the economic downturn, shifting demographics, and new expectations.

From Emerging Trends in Real Estate 2010:

Next-generation projects will orient to infill, urbanizing suburbs, and transit-oriented development. Smaller housing units-close to mass transit, work, and 24-hour amenities-gain favor over large houses on big lots at the suburban edge. People will continue to seek greater convenience and want to reduce energy expenses. Shorter commutes and smaller heating bills make up for higher infill real estate costs.

In New Jersey, sprawl is still alive, yet planners have been promoting urbanizing suburbs for years, and real estate developers, pushed by recent economic prosperity and market demands, have acquiesced. While sprawl is still alive, it is under constant assault.

Why?

Excessive traffic, unconscionable property taxes, overflowing school systems, lack of mass transit, high energy costs, shifting demographics, and way too many unshared municipal services (too many local governmental bodies). Moreover, judging from my peers, many are eschewing the suburban lifestyle—even though they had enjoyed a comfortable suburban upbringing—and flocking to urban areas.

It’s not just NYC, Hoboken, and Jersey City, of course. To name a few, New Brunswick, Westfield, Asbury Park, Red Bank, and Collingswood—all struggling communities just a few decades ago—are booming with yuppies and DINKs (double income, no kids). These locales have benefited from state funding and market driven redevelopment, both of which flowed like water during the 1990s and most of this decade.

Even though some of New Jersey’s downtown districts are struggling during the ongoing recession, thanks to recent redevelopment, cultural shifts, and legislative action, expect them to rebound well. The real protector, however, is a vibrant housing stock.

The theory is quite fundamental; sufficient housing engenders a critical mass of people within a finite area, creating synergy. In a downtown, as logic dictates, the residents can therefore support the local businesses, whose owners not only see an influx of revenue, but also have an incentive to maintain and improve their uses, as competition becomes fiercer. Housing generates people, people spend money, and businesses benefit, resulting in a safer and aesthetically pleasing environment and an influx of monies into the municipal coffers.

The housing has been built, and the residents are there, propelling a symbiotic relationship between the residents and shop owners, which is currently helping to sustain newly revitalized downtown cores.

There is now an established urban culture in New Jersey, and the state is doing everything possible to protect this core.

In a July post about the New Jersey Economic Stimulus Act of 2009, I wrote that the bill “seeks to spur economic development, while also artfully promoting smart growth practices.” In essence, although the urban core has already been established, more urban development is necessary to ensure prosperity during economic recovery:

It’s clear: with rising costs of materials, the burgeoning green movement, and statewide and federal policy anti-sprawl policy, the new waves of development will take the shape of redevelopment in our urban areas, where the infrastructure exists and where people can live, work, and play without a heavy reliance on the automobile.

Provide the incentives now in the lean times to develop, and once the economy rebounds, the foundation will have already been established, thus lessening the cost and hurdle of future development projects. This is smart growth in action.

My peers want smart growth; protecting the urban core is sprawl kryptonite.

They want to establish roots in vibrant, dense urban environments, rather than  isolated suburban subdivisions devoid of soul. Anecdotal evidence suggests that most of my friends (and not just my urban planning buddies) are interested in planting roots in urban communities, even suggesting that they would like to raise children there. Of course, as highlighted above, empirical evidence backs my findings, too.

Quite simply, the suburbs will never “fail,” but they’re in trouble, especially since the ongoing economic downturn is radically change our culture. The urban foundation has already been set for Generation X/Y. When the economy does rebound, look for continued urban support from the government (smart growth will become even more salient), which will in turn spur market activity in areas slated for growth.

Urban planning practices will become even more sustainable, just like the rest of our economy. This sustainable outlook will therefore propel a fundamental urban lifestyle.

Count on it.

So yes, the suburbs are really in trouble. Growth is not only least needed there, but  our shifting culture will simply not stand for the continued destructiveness of sprawl.

Perhaps this is just one silver lining of the recession.

Related posts on The New Wave Planner:

A Win For Urban Planning: Supermarkets Potentially On Their Way To New Jersey Cities

Innovation Is Now King, And It’s Perfectly Parallel With Obama’s Urban Policy Goals

A Vote For The New Jersey Economic Stimulus Act Of 2009 Is A Vote For Smart Growth And Economic Development

Backyard Chicken Coops? Urban Farming? There’s A Silver Lining To The Recession

NYC Planners: Zoning Bonuses Will Spur Healthy Eating And Economic Development

Once Again, The Baby Boomers Are Changing Housing

Save “Jersey Fresh” As We Know It

A vote for The New Jersey Economic Stimulus Act of 2009 is a vote for smart growth and economic development

New Jersey is not coping with the current global recession too well, and according to a July 9, 2009 article in the Newark Star-Ledger, it is among the states with the most critical budget shortfalls:

The state had to dig itself out of a projected shortfall of nearly 30 percent, or $8.8 billion, before passing the 2010 budget last month. That was the seventh-biggest gap in the nation, after California, Arizona, Nevada, Illinois, New York and Alaska, according to the Center on Budget and Policy Priorities.

It’s easy to blame the politicians, but in this current economic environment, that argument does not carry much weight, considering the budgetary conditions across the county.

Certainly, both Democrats and Republicans carry a share of the blame, but it’s well beyond statewide politics.

If blame is to be pinned on politicians, it should fall on those who supported bank deregulation practices, as ultimately the near collapse of the banking system is what almost brought our county to the brink of an economic apocalypse.

Beyond the appropriations issues, there is a garden variety of other economic concerns in New Jersey, most of which are tied to disappearing jobs, with a current unemployment rate of 8.8% (compared to 9.4% nationally). Due to the widening recession, businesses will continue to economize, meaning that weekly jobless claims should continue to rise at record rates.

Moreover, due to fears of looming pay cuts or job cuts, people are now beginning to save money, something many have not done since the boom times—flush with easy money—began.

Lastly, with the commercial real estate industry on the verge of collapse nationwide due to, according to Jon Greenlee of the Federal Reserve, an accumulation of $3.5 trillion worth of debt, the fears are real in New Jersey, with “for rent” signs popping up within sprawling office parks located just off many of the interstates. Take a ride through any office park in suburban Central and Northern New Jersey to see for yourself.

What does all of this mean?

People cannot spend money in our communities if the income faucet is not flowing. Without sales, this puts our retailers in jeopardy, which begins another domino effect of job losses and suffering.

An easy solution?

None exist.

A workable solution?

Yes.

The New Jersey Economic Stimulus Act of 2009, aka A-4048/S-2299, passed both the Assembly and Senate on June 25, 2009 and is now awaiting action from Governor Jon Corzine.

An omnibus bill, it is an important piece of legislation that, according to the preamble, concerns:

[E]conomic development, job creation, economic growth, affordable housing, urban transit hub tax credits, expanding capacity and facilities at our institutions of higher education, bonding in certain planning areas, and exempting certain taxes and energy charges of certain manufacturing facilities; authorizing certain taxes and fees to fund redevelopment; amending and supplementing various section of the statutory law; and making an appropriation [$15 million to the “New Jersey Affordable Housing Trust Fund.]

The New Wave Planner wholeheartedly supports this legislation.

Recognizing the severity of the current economic crisis and its trickle down effect, businesses need a significant stimulation—not just window dressing—in order to both retain and hire new employees.

We need economic development to spur job retention and creation, and with a deepening crisis that is expected to continue and a state unemployment insurance fund that is running on fumes, the legislature acted quickly and appropriately in passing this bill.

Let’s dig into the state stimulus package, specifically how it seeks to spur economic development, while also artfully promoting smart growth practices.

The over-arching intent is to spark developer activity in urban areas, or those areas in the Metropolitan (PA-1) and Suburban (PA-2) Planning Areas, as identified within the State Development and Redevelopment Plan (SDRP), though a cocktail of tax credits, an expansion of the Urban Transit Hub Tax Credit, and a temporary relief from non-residential affordable housing fees.

Clearly, this stimulus has deep roots in smart growth policy, as dictated by the SDRP, the visionary document that is intended to shape the future development of the state by identifying where development should and should not occur.

Designated by “Planning Areas,” with 1 being the area in which the most development should occur and 5, of course, where the least should occur, the paramount goal is to balance development with the protection of open space and rural areas.

Therefore, the document encourages development in areas with existing infrastructure (urban and some suburban areas), so as to lessen the overall cost to municipalities, where access to public transportation is available and people have access to goods and services within walking distance of their homes—therefore, not having to rely on personal automobiles, thus reducing traffic and air pollution.

The problem, however, is actually stoking the development in portions of our urban communities (such as Newark, Paterson, Camden, and Trenton, to name a few), and without an inducement, especially in this economic climate with bank funding scarce, positive change is unlikely.

Luckily, this legislation contains the requisite inducement.

The most generous and innovative aspects of the stimulus legislation is the creation of the Economic Redevelopment and Growth Grant (ERGG) program for areas within the PA-1 and PA-2, with the purpose of, according to the bill, “encouraging redevelopment projects in [a municipality] through the provision of incentive grants to reimburse developers for all or a portion of the project financing gap for such programs.”

Coupled with the expansion of the Urban Transit Hub Tax Credit program, which encourages economic development in nine urban communities within 1/2 mile of the train station, including Camden, East Orange, Elizabeth, Hoboken, Jersey City, Newark, New Brunswick, Paterson, and Trenton, through tax credits up to, in some instances, 100% of capital improvements within a eight year period (subject to minimum employment thresholds), the state stimulus package is mindful of where the jobs are needed and should be located.

How will these grants be funded? Directly from the taxes generated from the new developments that will follow as a result of the stimulus. Inducement for redevelopment projects in the state’s urban areas, especially in this economic climate, must be derived from an innovative program, and ERGG helps to fulfill this mission.

Ironically, the properties that developers avoided during the boom times of the past decade or so may be the same ones that help turnaround the current statewide economic ills.

It’s clear: with rising costs of materials, the burgeoning green movement, and statewide and federal policy anti-sprawl policy, the new waves of development will take the shape of redevelopment in our urban areas, where the infrastructure exists and where people can live, work, and play without a heavy reliance on the automobile.

Provide the incentives now in the lean times to develop, and once the economy rebounds, the foundation will have already been established, thus lessening the cost and hurdle of future development projects. This is smart growth in action.

Critics have emerged, with contention ranging from environmental to funding to affordable housing concerns. With most of the attention geared toward development in urban areas, the environmental issues are minimal, as the SDRP dictates that most of the future development should occur within PA-1 and PA-2.

Affordable housing, always a hot button issue in New Jersey, will be protected, as the legislation appropriates $15 million into the Affordable Housing Trust Fund in order to recoup a portion of payments that will be lost to the temporary relief from non-residential affordable housing fee provision of the bill. Nevertheless, the office and commercial construction will invariably stoke residential construction, which will require 20% affordable housing set-asides or a payment into the municipal Affordable Housing Trust Fund per each new development.

While funding is an immediate concern, since grant money is to be paid through individual ERGG programs within municipalities, in the long-term, once the taxes are generated from new development, money will flow back into municipal coffers.

Naysayers have suggested that the ERGG will siphon money away from municipal services; however, by granting money to development projects within urban areas, consistent with the intention of the SDRP, this will stimulate growth throughout New Jersey’s municipalities, from the high-rise office building to the mom-and-pop shops dotting the business districts, thereby helping to pull the state out of the current economic mess

The New Jersey Economic Stimulus Act of 2009 will help us get through these tough times, ultimately stimulating job creation, new construction in our urban areas that are well served by infrastructure and transit, and fulfilling smart growth goals.

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Related Posts:

Once again, the baby boomers are changing housing

So what is age-targted housing?

SO WHAT IS AGE-TARGETED HOUSING?

In my March 20, 2009 piece, I opined as to why, due to the economic downturn, a  shift in housing preferences, and various other reasons, municipalities should lift age restrictions on previously approved developments in an effort to stimulate development and improve communities.

If the bill in support of lifting the age restrictions meanders its way through the New Jersey Legislature successfully and is signed into law by Governor Corzine, then this will become reality.

The New Wave Planner supports this measure wholeheartedly.

But, wait a second.

Shouldn’t all of the 565 municipalities within the Great State of New Jersey be fearful of such a bill that could result in more children within the 616 school districts (yes, this is not a typo; New Jersey has 565 municipalities and 616 school districts), increased demands on municipal services, and therefore spikes to already burdensome property tax bills—all in the midst of the worst economic downturn since the Great Depression?

This just doesn’t sound right.

Some politicians are against lifting these restrictions, and I cannot blame them for one reason: for better or worse, it’s what they have to do.

I understand the political intricacies in New Jersey—which is a “home rule” state, meaning that a lot of power is vested in local government—and like anything else, it boils down to being “all part of the game.” In order to save face with their constituencies, Mayors have to sometimes vocalize their disagreements relating to certain initiatives, especially on such an issue that is so volatile in New Jersey.

The public perception is that “property taxes” and “school age children” are both dirty words, and as such, understanding local politics, speaking out against this is just a method through which one can ultimately win the game.

However, as I will now argue, not supporting a lift on restrictions could actually be detrimental to communities, given that, even though there are public perceptions to the contrary, “age-targeted” communities do not place excessive demands on municipal services and school systems.

So, what is an age-targeted community?

Understandably, there is much confusion with respect to the difference between age-restricted—developments that are restricted to those 55+ and have specific amenities catering to that cohort—and age-targeted communities.

In an October 2, 2008 Asbury Park Press article, “Age restriction becoming a drag,” Linda Bernaski, president of the Shore Builders Association of Central New Jersey, noted that wholly age-restricted communities have been well known among municipal elected officials as being the most attractive residential land use, mainly due to a lack of children burdening school districts, which is one of the reasons for New Jersey’s high property taxes.

While certainly a valid concern, a designation change to age-targeted does not open the proverbial flood gates of families with school-age children rushing into these types of developments. In the current marketplace, the emphasis is not primarily on age, but rather on the quality of the living experience.

Age-targeted communities are designed and positioned to attract mature households, but they are not marketed as 55+ communities. Tracy Cross, a housing consultant and president of Tracy Cross & Associates, Inc., noted, in a September 18, 2005 Chicago Tribune article, “Do you want age-restricted or age-targeted?,”  that “almost any condo is, by nature, age-targeted,” since the “newer condo buildings have the features that an older person would be looking for, such as an elevator and outdoor maintenance.” Other characteristic amenities include, but are not limited to, indoor or structured parking, master bedroom suites located on the same floor as the living room, dining room and kitchen to minimize the requirement of stair usage, modest bedroom capacities consisting primarily of one and two-bedroom floor plans; en-suite bathrooms that are captive to the bedroom areas to which they are attached, and the lack of exterior recreational facilities designed for the use by children.

Even though age-targeted communities do not prohibit those age 55 or under, the use of affirmative marketing techniques, such as using buzzwords like “care-free living” and “maintenance-free living,” appears to attract a market share that does not include couples with school-age children.

A potential explanation for the predominant market share of couples without children is the psychological impact of the types of words associated with aging. Bill Feinberg, whose Philadelphia-based consulting firm Feinberg & Associates works with several builders, stated that half of the people whom his firm interviewed in four focus groups in 2004 said they were not interested in any community labeled “age-restricted,” as discussed in a January 2004 article in Builder. Age-targeted communities also attract younger couples without children for similar reasons.

Doris Pearlman, a real estate and design industry veteran, in January 30, 1998 article in RealtyTimes, “Emerging Buyer Profiles: Who Will Dominate Tomorrow’s Market?,” opined that the demographics of housing changed during the late 1990s, when “buyer profiles started combining and recombining.” Up until the late 1990s, according to Pearlman, the industry had been generally traditional, consisting mostly of “first-time buyers, move-up buyers, third-time buyers, or middle-age high-achievers.” The late 1990s and early 2000s, which coincided with the oldest baby boomers becoming empty nesters, saw a shift in the dynamic, with “full-circle buyers” (older couples that are not ready to purchase a unit in a retirement community) vying for homes not just with first-time buyers (reflecting the commonly known desire to downsize homes to minimize unneeded space and costs associated with larger homes), but with “free-spirit buyers,” “who may be divorcees with children, same-sex couples, unmarried but related roommates, or the so-called “dinks” (double income, no kids).

Although this example of shifting housing tastes is broad and not necessarily applicable to any specific housing type, it demonstrates the dynamic nature of demographic changes over the past decade, and the blending of cohorts that are seeking similar housing experiences.

While there are no widely available demographic multipliers for the relatively new age-targeted market, the fact that apartment/condominium living imparts a slight impact on a school district, compared to that of single-family homes, is a substantive argument in favor of a change to age-targeted housing.

The Center for Urban Policy Research at Rutgers University publishes demographic multipliers that are widely considered the de facto source for housing demographic profiling information in New Jersey. According to page 6 of the November 2006 release,  Who Lives in New Jersey Housing, “in general, detached housing currently produces the highest number of residents and pupils compared to attached homes. Detached homes with more (4-5) bedrooms have the relatively largest household size and pupil generation.” However, it continues, “common types and configurations of attached housing, such as 2-to-3 bedroom townhouses and 1-to-2 bedroom multifamily units, have a relatively low demographic impact.” Parenthetically, it should be noted that the study notes that “demographic multipliers need to be continuously updated, refined and tested” (page 7) and “for best results, the state-level data presented here should be supplemented by local analysis” (page 8).

Nevertheless, the amenities prototypical of age-targeted communities simply do not attract households with school-age children.

Based on all of the quantitative and qualitative evidence presented herein, age-targeted communities do not present the commonly perceived deleterious impacts on communities. Especially in NJ, a state that has been losing residents for years and is now being hit with residential and non-residential development projects alike that are not moving through the market, it is imperative to work with the development community to devise an equitable and feasible solution for all parties, and the current bill in the New Jersey Legislature would do just that.

Once again, the baby boomers are changing housing

The post World War II American story is well known. With the GIs returning home en mass immediately following the end of World War II and fueled by a sense of optimism for a bright future, marriage rates increased steadily, city population declined, and the baby boom generation exploded onto the scene.

As a result, quality housing for the influx of new families became the salient issue, as demand exceeded supply tremendously. Iconic developers, such as Levitt & Sons, Inc., seized the opportunity to fulfill a market void by constructing mass-produced suburbs, produced under the tenets of speed, efficiency, and cost-effectiveness. Other developers quickly followed and continued to meet the demand, thus creating the archetypal suburbs, which still live on in the 21^st century.

The story of the baby boomer generation is similarly well known. With their sheer numbers, their middle class suburban upbringing, the innumerable social movements that characterized that 1960s and 1970s, and their education and affluence, the baby boomers changed everything in their path. Just like their parents—and even more so—the housing market adapted to their desires, beginning with the garden apartment movement in the 1970s when most were just starting out, peaking in the 1990s with the McMansion craze at the peak of their earning power, and now, for some, transitioning to a desire to down-scale and live in communities that were built specifically for them. In a 1990 New York Times article, James W. Hughes, then chairman of the Department of Urban Planning and Policy Development in the Edward J. Bloustein School of Planning and Public Policy at Rutgers University, noted that, by the year 2000, “the broad maturing middle-age population is going to do to the upper end of the housing market what they did to the school systems in the 1960s – push it to the limits.” His 1990 analysis was certainly prophetic, with a housing bubble forming in the late 1990s and early 2000s, and an accelerating age-restricted marketplace.

However, with the recent over-arching economic troubles, the housing industry has been hit hard, with developers seeking creative measures to retain as much solvency as possible in their ventures, especially in the age-restricted housing market. Since 2005, when the deterioration of the housing market began, it has been widely reported that sales have declined, inventory has risen, and as a result, home prices have declined. Once again, baby boomers and those slightly older are entrenched in this latest housing phenomenon, as some older people have begun to leave New Jersey for cheaper and warmer locales at a steadily increasing rate, while others have had an increasing preference to age in-place. With the influx of housing inventory, some baby boomers have also been unable to sell their present homes, forcing them to re-think housing changes.

As such, with baby boomers again reshaping the housing market and the affinity towards age-restricted communities beginning to wane in this economic downturn, developers are beginning to wonder how to tackle this issue, with some seeking to remove the age-restriction on their communities and replace with either an open market or an age-targeted designation.

According to Jeffery Otteau, a leading market analyst and proprietor of Otteau Valuation Group, Inc., in New Jersey, there are numerous projects for which age-restrictions have been lifted or lowered, including those in Maplewood, Fort Lee, Hackettstown, Mountain Lakes, Bound Brook, Princeton Township, Morris Township, Pine Hill Township, and Riverdale Borough. With the impacts of the recession hitting New Jersey relatively hard, municipalities cannot afford to let some newly built communities to amble on with low occupancies.

With economic feasibility becoming an issue for age-restricted housing, due to a lack of interest in bank financing due to higher construction costs, discounted market pricing, and an oversupply of projects, age-targeted housing is becoming an attractive option.

New Jersey lawmakers are now starting to realize that vacant, unfinished, or minimally populated developments present a complex trifecta—physical, psychological, and political—of problems. The experts agree that there is an abundant supply of age-restricted housing, and in my opinion, to just let projects remain in a static state is an untenable position.

So, what’s the solution? Lift the age-restriction on housing reserved for those 55 and older, lawmakers say, and in doing so, require that the developer set-aside 20% for affordable housing. All in all, if executed property, it’s a perfect carrot-and-stick approach. Not only would this serve as an inducement for bank lending and smelling salts for dormant developers, but it would also create more construction jobs and, perhaps most importantly, inspire some confidence in the people. Never discount the psychological impact of seeing active construction sites in a down economy.

Naturally, the opponents have emerged, and the paramount point of contention is that lifting the age-restrictions would result in an influx of school-age children into local school systems, thus potentially spiking already onerous property taxes. Certainly a way to strike fear into the millions of NJ residents paying exorbitant property taxes, but it’s a misinformed statement.

As I will demonstrate in an upcoming post, couples with school-age children are not generally drawn to developments originally designed for the 55+ cohort, as the living arrangments and amenities are simply not tailored to a family lifestyle.

Welcome, age-targeted housing.