The Entry-Level Home Production Incentive Act of 2026 aims to address the housing affordability crisis for low- to middle-income individuals in New Jersey by establishing a program within the New Jersey Housing and Mortgage Finance Agency. The bill allocates $300 million to create the EntryLevel Home Development Fund, which will provide project gap financing for housing developments that meet specific income criteria. The program will offer financial assistance in the form of gap grants of up to $40,000 or $70,000 per unit, depending on the income level of the occupants, and infrastructure loans through the New Jersey Economic Development Authority. Developers must commit to occupancy requirements, ensuring that units remain affordable for a minimum of five to ten years.

Additionally, the bill prioritizes funding for projects located in municipalities that adopt overlay zoning for small-lot housing, as well as those led by minority or women-owned businesses and those meeting energy efficiency standards. The New Jersey Housing and Mortgage Finance Agency is tasked with reporting annually on the program's outcomes, including the number of housing units produced and the funding distributed. The legislation emphasizes the need for dedicated financing to support the development of affordable housing, thereby increasing the availability of homes for those struggling to enter the housing market.