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Rent prices for all unit classes are soaring across the country. A 15% to 20% increase in rent prices is not unheard of, and tension is growing between landlords and tenants because of this.
As a landlord, you might be tempted to raise the rent on your New Jersey rental; however, there are some things to think about to make sure you're doing this legally and sensibly.
Since 2019, rental rates have dramatically increased in numerous places across the United States, including New Jersey.
Since New Jersey doesn't have a rent increase limit, it still has a very competitive rental market, even though it is not at the top of the list of average rental increases by state.
Property owners should stay up to date with the local rates to optimize their earnings. In order to prevent losing valued tenants in your area, you need to be aware of a number of rules and local trends if you intend to raise your prices.
New Jersey Rent Control Laws
No, there are no statewide rent control laws in New Jersey. However, the state allows the various governments to impose local rent control laws.
Therefore, landlords are free to increase rent at whatever rate they deem appropriate unless the local government has imposed its own rent control laws.
It's important to note that Assembly Bill 2390 was introduced in New Jersey law in February 2022.
Therefore, if it's passed, there will be a 5% limitation in addition to 10% or the percentage change in the cost of living (whichever is lower) on rent increase rates.
Proper Notice
Unless the contract stipulates a longer duration, New Jersey state law requires landlords to give one month's notice before imposing a rent increase.
The notice needs to be delivered to the tenant by:
- Certified mail;
- Hand-delivery to the lessee or a family member (older than 14 years); or
- Regular mail.
Cities that have local rent control ordinances generally require landlords to issue a longer notice; for example, a 60 days notice period is required in Edison.
Rent Increases
Landlords in New Jersey are permitted to increase the rent on their rental units by any amount they see fit.
Although there is no statutory restriction or limit on rent increases, they need to be fair and reasonable.
There are restrictions on rent increases in place in more than 100 cities, including:
- Atlantic City: This depends on the Consumer Price Index (CPI)
- Elizabeth: 3% - but limited to $20.
- Edison: A maximum of 5%.
- Lakewood: 6.5% if the landlord pays for heating but 5% if the tenant pays for heating.
- Jersey City: Depends on the Consumer Price Index but is limited to 4%.
- Paterson: Limited to 5%, but if the tenant is disabled or a senior, it's limited to 3.5%.
- Newark: Depends on the Consumer Price Index but a maximum of 4%.
Final Verdict
New Jersey aims to protect tenant rights. Therefore, you should be sensitive to this cultural expectation as a landlord and increase rent in line with market trends, employee expectations, and the rates of similar apartments in the area.
The burden of proof shifts to you if your lessee complains that the rent increase is unjustified.
In New Jersey, you should price your rentals competitively and gradually raise the rent as the housing market strengthens in order to avoid conflict in an otherwise positive tenant relationship.
If you're experiencing a strain on your landlord-tenant relationship due to any other reasons, make sure to look at our comprehensive guides on New Jersey Landlord-Tenant laws, security deposit laws, and eviction laws.
Furthermore, if you need guidance drawing up any type of rental agreement, we have a range of free forms and resources you can use.
Webinar
DoorLoop hosted this webinar with attorney Craig Rothenberg from The Law Office of Craig Rothenberg to help answer many of your legal questions. Craig specializes in real estate law and evictions in New Jersey and we covered:
- Landlord-tenant issues and laws
- Grounds to evict a tenant
- Eviction process
- Preventing delays or fines
- Hiring an Attorney vs DIY
- Post COVID legal changes
Feel free to learn more and watch this webinar for free.
FAQs
How Often Can a Landlord Raise Rent in New Jersey?
According to state law in New Jersey, landlords are permitted to raise rent as often as they like as long as they give each tenant enough notice.
However, the frequency of rent increases is restricted in many cities via municipal rent control regulations (for example, in Elizabeth, it's limited to once a year).
If you have a month-to-month lease agreement with your tenants, you can increase the rent at any time as long as you give the lessee one month's notice.
Keep in mind that if Assemble Bill 2390 is passed, there will be a once-per-lease term limitation on how often rent can be raised.
When Can a New Jersey Landlord Raise Rent?
As long as the landlord isn't retaliating or discriminating against the lessee, they can increase the tenant's rent at the end of a lease term for any reason.
However, this cannot be done during the lease's fixed term, and the lessee needs to be given sufficient notice.
Can Cities in New Jersey Impose Rent Increase Limits?
Yes, there are over 100 cities in New Jersey that have imposed their own rent control laws.
When Can't New Jersey Landlords Increase Rent?
A landlord can't increase rent when it comes to discrimination and retaliation against a tenant.
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