Before 1967, New Jersey took a laissez-faire attitude toward housing. With each locality free to fashion its own zoning ordinances, large tracts of rural land succumbed to "suburban sprawl"—single-family housing developments spread out in two huge arcs from New York City and Philadelphia. Meanwhile, the tenement housing of New Jersey's central cities was left to deteriorate. Because poor housing was at least one of the causes of the Newark riot in 1967, the state established the Department of Community Affairs to coordinate existing housing aid programs and establish new ones. The state legislature also created the Mortgage Finance Agency and Housing Finance Agency to stimulate home buying and residential construction. In an effort to halt suburban sprawl, local and county planning boards were encouraged during the 1970s to adopt master plans for controlled growth. Court decisions in the late 1970s and early 1980s challenged the constitutionality of zoning laws that precluded the development of low-income housing in suburban areas.
In 2002, the state had an estimated 3,372,572 housing units, of which 3,081,928 were occupied; 65.9% were owner-occupied. About 54.2% of all units were single-family, detached homes. Nearly 46% of the entire housing stock was built before 1969. Utility gas is the most common heating energy source, followed by fuel oil and kerosene. It was estimated that 69,464 units lacked telephone service, 12,764 lacked complete plumbing facilities, and 14,958 lacked complete kitchen facilities. The average household size was 2.72 people.
In 2002, 30,441 new privately owned units were authorized for construction. The median home value was $210,483, the 5th-highest in the country. The median monthly cost for mortgage owners was $1,672. Renters paid a median of $808. During 2002, New Jersey received over $177.5 million in community planning and development aid from the US Department of Housing and Urban Development.