In response to inflation, rising interest rates, and other factors that increase the cost of living, many property owners and landlords have increased rent prices. You may find it’s time to follow suit, but before doing so, it’s important to review the rent control laws in your state. These stipulations vary by state, and navigating rent control can be particularly challenging in New Jersey.
Cervelli Real Estate & Property Management serves property owners throughout the Gold Coast of New Jersey, including in Hudson, Bergen, Essex, Union, and Passaic counties. We offer apartment building management services to help property owners adhere to codes and better meet the needs of their renters. Here, we explore New Jersey rent control and how you can determine which rules apply to you.
State Rent Control Laws in NJ
The New Jersey state government doesn’t impose statewide rent control laws. Instead, it gives municipalities the ability to issue local rent control laws. In other words, property owners can increase rent at whichever rate they find necessary, provided the local government hasn’t instituted limits for the area.
In February 2022, the state assembly introduced a bill that, if passed, can affect statewide regulation of rent increases. Assembly Bill 2390 cites the financial challenges that rental housing places on residents throughout New Jersey, advocating for the state legislature to put forth a reasonable, statewide limit on annual rent increases. It suggests that once a landlord increases rent for the year, they ought to be prohibited from increasing the rate by more than 5% (plus inflation) or 10%, whichever is lower, of the lowest rental rate for that apartment unit within the previous 12 months before the initial increase.
Assembly Bill 2390 hasn’t yet become law, but if passed, it will mean a once-per-lease term limitation on how often property owners can raise rent in New Jersey.
Local Rent Control Laws in NJ
Despite the lack of regulation from the state government, there’s still a demand from residents for landlords to act responsibly and be fair in their rent increases. For these reasons, over 100 New Jersey cities have implemented local restrictions on rent increases. Below is a sample of municipal rent control laws:
Elizabeth, NJ (Union)
This law states that a landlord can’t increase rent rates by more than 3% of the base rent. When 3% over the base rent for the 12 months prior is greater than $20, the maximum increase allowed is $20. It also states no landlord may request or accept more than one increase in base rent during 12 months.
Paterson, NJ (Passaic)
Landlords can request to increase the rent of rent-controlled apartments by 5% annually. For units where the head of household tenant is a senior citizen (65 or older) or has disabilities under SSI disability programs of the Social Security Administration, the limit is 3.5%.
Jersey City, NJ (Hudson)
Landlords can increase rent rates no more than 4% or the percentage difference between the Consumer Price Index three months before the lease expires or terminates – whichever amount is lower. For periodic tenants whose lease is for less than a year, no more than one rent increase is permitted within 12 months.
Newark, NJ (Essex)
Like the ordinance in Jersey City, Newark law says no landlord can increase rent by a percentage greater than what’s found in the Consumer Price Index. Regardless of this percentage, no rent increase can exceed 4%. Property owners should also note that annual rent increases will not be allowed if the unit doesn’t meet compliance standards or registration requirements.
These are just a handful of local ordinances regarding rent control in New Jersey. Property owners and landlords are encouraged to visit the official websites of the cities and towns in which they own apartment buildings to find out the specific guidelines in those areas.
Learn More About New Jersey Rent Control
Property owners can find themselves in a bit of a predicament as they want to raise rent prices while adhering to local ordinances and maintaining their reputation as landlords who look out for their tenants. When the challenges of managing an apartment building become overwhelming, property owners can seek assistance from Cervelli Real Estate & Property Management.
A family-owned and operated business, Cervelli Real Estate & Property Management has years of experience providing personalized property management services to apartment building owners like you throughout New Jersey, including Hudson, Bergen, Essex, Union, and Passaic counties. Our team helps tenants understand their responsibilities and the duties of the property manager, and we offer services like property inspections and financial reporting. Contact us today to find out more about how we assist apartment building owners.