NJHMFA Sells $40M Tax Credits for Affordable Housing

The New Jersey Housing and Mortgage Finance Agency (NJHMFA) has successfully sold $40 million in state tax credits to various corporations, initiating what the agency describes as the first program of its kind at this scale implemented by any U.S. state. This initiative is specifically designed to increase the availability of housing by drawing private investment into affordable and workforce housing projects throughout New Jersey. Governor Mikie Sherrill stated that these tax credits are instrumental in converting private investment into housing opportunities, enabling families, seniors, and essential workers to establish roots within their communities. She emphasized the program's role in addressing New Jersey's housing shortage and fostering stronger communities for future generations. Following the successful completion of its inaugural spring 2026 auction, NJHMFA has announced plans to offer approximately $60 million in additional state tax credits through a second auction scheduled to run from October 16 through November 30. The revenue generated from these auctions will continue to be directed towards the development of affordable and workforce housing. New Jersey Assembly Speaker Craig Coughlin highlighted the program's immediate impact, noting that it is already assisting developers in overcoming financing obstacles and accelerating the progress of their projects. He expressed satisfaction that his legislation, A3128, is effectively contributing to the expansion of New Jersey's supply of affordable and middle-income workforce housing. New Jersey Senate Majority Leader Teresa Ruiz commented that the initiative exemplifies the potential of public-private partnerships in tackling the challenges of housing affordability. Under the terms of the program, eligible businesses can bid on state tax credits, with a minimum bid requirement set at 80 cents on the dollar. The average winning bid during the spring auction reached 87 cents on the dollar. The tax credits awarded can be utilized against either the Corporate Business Tax or the Insurance Premium Tax. Any unused credits have the provision to be carried forward for a period of up to seven years. The program mandates that half of the awarded tax credits must be allocated to projects that serve low-income households, with a specific focus on those earning 60% or less of the state's median income. The remaining half is designated for workforce housing developments, targeting individuals and families earning between 60% and 100% of the state's median income. This dual allocation strategy aims to address a broad spectrum of housing needs within New Jersey. The NJHMFA anticipates that this program will stimulate significant private investment in the affordable housing sector, leading to the creation of thousands of new housing units across the state over the next decade. The agency is also exploring potential expansions of the program, including the possibility of offering federal tax credits in future iterations.