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ATLANTIC CITY, N.J. – More than 150 government leaders and their counselors were urged to join homebuilders in seeking new ways of balancing the growing need for homes in New Jersey with the desire to preserve land.

With the League of Municipalities annual convention as a backdrop, executives of K. Hovnanian® Homes™, New Jersey’s largest homebuilder, along with an economist from Wachovia Securities, hosted a panel discussion about the state of homebuilding in New Jersey and its economic effect on towns and cities.

"We have a generational obligation to find new ways to balance the need for shelter and open space," said Joe Riggs, group president of K. Hovnanian Homes. "Old tools and old attitudes have to change. They don’t work any more."

Ara Hovnanian, president and chief executive officer of Hovnanian Enterprises Inc., Mark Vitner, director and senior economist at Wachovia Securities, and Riggs used economic models to point out the need for additional homes in the state.

"It’s Economics 101," Vitner declared, showing graphs that showed New Jersey’s population growth and home prices. Vitner pointed out that the housing shortage in New Jersey is forcing home prices up. If, he said, it’s easier to purchase a home in another state, workers will move to those states. Businesses that need workers will follow them out of New Jersey.

Riggs amplified the thought by showing graphs displaying the state’s population increases and homebuilding trends. The graphs clearly demonstrated that the state has not met the housing demand for a long time, leading to high prices and scarcity.

"We need a comprehensive answer to the problem of providing shelter for our growing population," he said. He said the State Development and Redevelopment Plan was a good start, but was never implemented properly. Actions such as large-lot zoning, taken in the name of conservation, have sparked a rapid consumption of land, infrastructure inefficiencies and fiscal challenges. He criticized the expenditure of public funds on land to stop development rather than to produce a park or other public space.

Answers, he acknowledged, weren’t easy. While redevelopment provides one answer, he pointed out that even if multiplied significantly, only a small percentage of the state’s homes could ever be built in the cities. He also said the state’s development and economic models have created a housing environment that is hostile to children because communities don’t want them.

"Growth patterns in New Jersey must change to reflect new realities and new demands," he said.

Riggs said K. Hovnanian favored applying a variety of tools, including well thought-out transfer of development rights programs, additional redevelopment opportunities in the cities and suburbs, property tax reform, impact fees and studies to determine how much growth can actually be accommodated and where it will fit best. Riggs said appropriate density was among the most important tools available.

Applying those tools, he continued, allows the creation of a variety of new development styles and patterns that can generate homes and public open space.

Company officials then showed redevelopment sites, transit villages, traditional neighborhood developments and other new-style communities.

"We need to work together with new ideas and new attitudes," concluded Riggs. "When we do, we can balance the need for shelter and land preservation while controlling the fiscal impact on your town, protecting our resources and assuring sustained economic growth. It’s our key to a healthy future."