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The tourism economy in Cape May County thrived in 2021, producing a rebound from the pandemic that was stronger and broader than anyone expected.  

The latest county numbers show tourism spending was likely higher in 2021 than in the record-setting pre-pandemic year of 2019. 

Real estate values increased significantly with low-interest rates, a pandemic-induced desire for space, and a revolution in workplace use of the internet to facilitate remote work options. The county became a desirable place to relocate despite a seasonal economy that offers a limited number of year-round jobs. 

Amid these positives is a longer-term trend that does not bode well for the county’s future. We are not holding our young families. The gradual trending down of county population hides a steeper decline in young working-class families. With each passing year the county ages, its population is consistently the oldest in the state. 

With each passing year, as well, the percentage of young families facing housing burdens increases. The median household income in the county is only 80% of the state average. One of the places where that matters most is in housing. 

Housing values in the county have steadily increased faster than the average household income. That puts many of the young families in the county at a serious disadvantage. 

The rise in property values, especially in the county’s island communities, leads to increases in valuations everywhere with higher rents and higher mortgage payments for county families. If we fail to address the problem, as unintended as it may be, we run the risk that those young families who can leave will increasingly do so. 

Federal Reserve Economic Data (FRED) shows Cape May County in the top third of New Jersey counties in terms of the housing burden experienced by its residents. The definition of a burdened household is one in which more than 30% of household income must go to the cost of housing. With census data showing us that nearly 40% of county households earn less than $50,000, it does not take much math to see that housing can be a very expensive proposition for working-class families. 

County municipalities have been engaged in dialogue over what can best be termed official affordable housing plans, those plans that spell out how the towns will meet state-imposed affordable housing obligations. 

Recently, Stone Harbor approved a subdivision of 14 new homes on the site of the old Villa Maria by the Sea. To meet its official affordable housing set aside requirements, the borough invested in property close to its business district to establish three affordable housing units. Those actions, well-intended and in line with court-approved plans, will not resolve our housing problems. 

We need to lower the barriers for productive workers to reside in the county. We need to retain those who can contribute to economic growth and general vitality. To do that, we need more than fair share housing plans. 

The county’s political leaders need to play a role in increasing the amount of rental housing stock aimed at and affordable by working-class families. We need that plan to remove barriers to profitability in the development of that housing stock.  

Such plans may include tax advantages, density allowances, zoning flexibility, and other factors. If we can develop ways in which housing stock for working-class families can be profitably developed, the market will lead the way to a solution to the housing problem. 

We are now in an environment in which an additional regulatory burden will be placed on housing construction costs as federal and state agencies seek to “incorporate” climate change into their regulations. This complicates the problem of working-class housing, but it does not remove the burden of finding realistic ways to address it. 

Inaction on our housing problem will surely lead to driving many of our potentially most productive workers away. 

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