ATLANTIC CITY — Plenty of existing homes on the market have created challenges for New Jersey homebuilders, an economist said at an annual builder’s convention Wednesday.
Many millennials — those in their 20s and early 30s — cannot afford to buy a new home, said Kevin Gillen, chief economist for Meyer Research of Philadelphia.
Other people want to sell their homes, but owe more than what the home is worth, he said.
“New home prices in New Jersey are above the national average, and obviously above existing homes’ prices. That has led to higher material and labor prices. And house prices going up means house unaffordability,” Gillen said, speaking at the New Jersey Builders Association’s Annual Economic Forecast at the Atlantic Builders Convention.
The convention takes place at the Atlantic City Convention Center each year.
Gillen said home ownership is below the national average, with only 63 percent of homes owned by those who occupy them.
Builders at the convention turn to networking to tackle projects together — contractors finding builders and landscapers.
The Atlantic Builders Convention lasts for three days and expects more than 6,500 participants. The convention, which also includes seminars and workshops, ends today.
Gillen said the purpose of the show, for many owners, is to find cheaper materials and to create a network among builders.
“Construction costs are up not just in New Jersey but nationally — partially due to labor shortages and material costs being high,” Gillen said. “So a lot of owners here are looking for low-cost building materials. They want to know where they can get cheaper Sheetrock, cheaper timber or cheaper plumbing.”
For Andrew Shaw, director of business development for FGM Fullerton Landscape Design in Kenvil, Morris County, exchanging business cards is a huge part of the process.
“Either here or afterwards, you want to meet a good leader or connect with someone,” Shaw said. “You look for those relationships to work hand in hand. And then when a builder works on a new building, then we can put in landscaping, and that’s how a relationship starts.”
For many businesses, such as F&C Professionals of Plainfield, it’s about word of mouth.
“Someone will recommend you to other people who can use you and your product. You never know what one contact can lead to,” said Carmen Melendez, office assistant for the railing company.
Richard Gallo, lighting manager for Ferguson Bath, Kitchen and Lighting, a Lakewood business with a shop in Egg Harbor City, said that business has finally begun to see steady growth in recent years.
“It’s been a steady climb since the housing market came apart,” Gallo said.
Gallo was showing off LED lights at his exhibit and said people are now willing to spend more on their homes.
“People are willing to put their feet in the water and get their toes wet. People who have put things off are now doing more renovations and unique themes,” Gallo said.