NJ Affordable Housing Incentives - Developers
New Jersey offers a range of incentives to encourage developers to build affordable housing:
1. Financial Assistance Programs:
Affordable Housing Trust Fund Program: Administered by the New Jersey Department of Community Affairs (DCA), this program provides financial assistance to municipalities, for-profit, and non-profit developers to spur the development of affordable housing across the state.
Affordable Housing Production Fund: Developers can receive up to $150,000 per unit, with a maximum of $8 million per project, through this fund. Financing options include construction loans and permanent financing with favorable interest rates.
2. Tax Incentives:
Accelerated Depreciation: Effective January 1, 2025, New Jersey offers accelerated depreciation for qualifying affordable housing projects, allowing developers to recover costs more quickly.
Historic Property Reinvestment Program (HPRP): This program provides tax credits covering 45-60% of eligible costs for developing historic properties, which can be combined with federal historic tax credits.
3. Development Incentives:
Density Bonuses and PILOT Agreements: Municipalities may offer increased density allowances and Payment In Lieu of Taxes (PILOT) agreements to make affordable housing projects more financially viable.
Aspire Program: Managed by the New Jersey Economic Development Authority (NJEDA), Aspire is a gap financing tool that supports mixed-use, transit-oriented development projects, including those with affordable housing components.
These incentives are designed to make the development of affordable housing in New Jersey more attractive and financially feasible for developers.
