New Jersey Homeowners Enjoy Some of the Nation’s Lowest Insurance Costs Now, But Hidden Flood Risks Loom

New Jersey homeowners continue to pay relatively low insurance costs compared with national averages, despite being a coastal state exposed to storms and flooding.

While premiums are rising across the U.S., particularly in Gulf Coast states, new data from the U.S. Census Bureau and the Realtor.com® 2025 Climate Risk Report show that New Jersey remains one of the more affordable insurance markets in the Northeast.

New Jersey’s Insurance Costs Stay Affordable

According to the American Community Survey (ACS) data from the U.S. Census Bureau , New Jersey homeowners with a mortgage typically pay $1,000–$1,499 annually for homeowners insurance, while those without a mortgage average the same $1,000–$1,499. Overall statewide costs also fall into the $1,000–$1,499 range.

New Jersey has 2,625,718 insured homeowner households in total—1,739,320 with a mortgage and 886,398 without. Among mortgaged owners, 139,567 pay less than $100 annually and 97,786 pay $4,000 or more. Among those without a mortgage, 148,054 pay less than $100 and 37,247 pay $4,000 or more.

Compared with nearby states, New Jersey remains affordable. New York homeowners with a mortgage average $1,000–$1,499, matching New Jersey. Pennsylvania homeowners also fall into the $1,000–$1,499 range for mortgage holders, while non-mortgaged households average slightly less at $800–$999. Delaware is even more affordable, with non-mortgaged homeowners typically paying $800–$999. By contrast, Connecticut and Massachusetts homeowners with a mortgage pay $1,500–$1,999, making New Jersey cheaper than its northern New England neighbors.

Climate Risks Across the Region

While New Jersey’s premiums may look modest, climate risk remains a looming challenge. The Realtor.com Climate Risk Report found that the New York–Newark–Jersey City metro, which includes northern New Jersey, ranks among the top U.S. markets for hidden flood exposure. The region shows a $95.3B gap in home values at severe or extreme flood risk that fall outside FEMA flood zones. That means many homeowners may underestimate their true exposure, leaving them without flood insurance.

Wind threats are another concern. The same report estimates more than $545.6B in New York–Newark–Jersey City home value faces severe or extreme hurricane wind risk. Unlike wildfire-heavy states such as California, New Jersey’s biggest insurance challenge is water-related—storm surge, hurricanes, and extreme rainfall events.

As Realtor.com economist Jiayi Xu notes in the analysis, “Insurance costs weigh most heavily on lower-value, high-risk markets—particularly in states like Louisiana and Florida”.

While New Jersey is not at the top of that list, its metro areas are undeniably tied to flood and wind patterns that could reshape future premiums.

A National Affordability Challenge

New Jersey’s relative affordability stands in contrast to the broader national picture. The Realtor.com 2025 Insurance Affordability Report found that 75% of Americans believe homeowners insurance could soon become unaffordable, while nearly half said they had already faced difficulties renewing or obtaining coverage.

Rising costs are already shaping buyer decisions. Nearly 30% of homebuyers said they had completely changed their search areas because of insurance challenges, while another quarter reported overhauling their strategies altogether. Even more concerning, 58% of homeowners nationwide said they would consider dropping insurance if costs became too high, with younger buyers the most likely to take that risk.

For now, New Jersey homeowners benefit from relatively affordable premiums compared with national hot spots. But as coastal climate risks intensify, affordability pressures could eventually catch up with the state’s housing market.

This article was produced with editorial input from Dina Sartore-Bodo, Gabriella Iannetta, and Allaire Conte.