NJ Realtors® Journey with Lead Paint

NJ Realtors® has been dealing with the issues stemming from the use of lead paint for nearly 20 years. New Jersey has continued to face the consequences of lead paint due to having one of the oldest housing stocks in the country—there are over 1.1 million homes still in use that were built prior to the United States banning the use of lead paint. Many of these older homes are concentrated in urban communities which are often home to the state’s poorer, minority citizens.

Homes with lead paint hazards can be extremely dangerous to the children that live in them. Children exposed to these issues often develop learning, behavioral, and several health issues. While New Jersey Realtors® has always agreed with the goal of ridding lead paint hazards for the health and safety of New Jersey residents, the association has been hesitant on some lead paint measures because they could create some inefficiencies and unaddressed costs.

Leading up to this year, many of the proposed bills addressing lead paint would have required remediation of lead paint before buyers or renters could move into their new home. This required remediation would not only prolong the transaction process, but it would also come with high financial costs. An average inspection costs $1,000, and if remediation is required, it would cost on average $15 per square foot to address the issue. In a city with lead paint issues like Newark, where the average home sold for $315,000 in June 2021 and is about 2,500 square feet, the cost of remediation can be $38,500 or about 12 percent of the cost of the home. There is also a severe lack of lead paint inspectors which would lead to each inspector inspecting hundreds of homes a year and delay countless home transactions. These compounding issues not only cause a prolonged sale, but also a severe drop in home values.

NJ Realtors® has been working with legislators and governors to ensure legislation addressing lead paint hazards would not have a detrimental impact on the housing market. While the current legislation that came up, S1147, was introduced by Sen. Teresa Ruiz in February 2020, NJ Realtors® has been working on this bill since Sen. Ron Rice originally introduced it in 2003. When the S1147 was initially introduced, it would have required lead paint inspections before time-of-sale or tenant turnover. The NJ Realtors® Government Affairs Department had apprehensions about the negative effect this bill could have on time-of-sale and the high additional costs. This led them to reach out to the legislature and come up with a compromise that would progress the state towards the goal of remediation in a more real estate friendly way.

Eventually, the bill was substituted with new language that changed the requirement. Now, once there is tenant turnover at a rental residence, or within two years of the bill’s effect date, an inspection is needed. An additional $3.9 million was also put aside for grants that property owners can apply for to address the lead-based hazards in the home. The need for more inspectors was also addressed, and towns who have dedicated inspections agencies will be obligated to provide the necessary inspections to the property owners. Before the bill goes into effect, the Department of Community Affairs will develop a seminar and other materials for relevant stakeholders, like Realtors® , to help them understand what will be needed from them. The DCA is also required to seek input from relevant stakeholders on the mandates, meaning NJ Realtors® will be in contact with them in the development process.

The bill was signed into law by Gov. Murphy on July 22 and it will go into effect one year from the signing date, July 22, 2022. This bill will help New Jersey move towards having healthier places to live in, without having property owners incur thousands of dollars in remediation costs. Be sure to keep an eye out for more information on these requirements from NJ Realtors® and the Department of Community Affairs.