How Much Can You Raise Rent in New Jersey in 2025?

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Determining how much landlords can raise rent in New Jersey involves navigating a decentralized system of rent control regulations. No statewide law limits residential rent increases, allowing municipalities to enact their own rent control ordinances.

As a result, the specifics of rent increase limits vary widely across New Jersey’s many towns and cities. Some have instituted strict caps, while others tie increases to inflation indexes or operating cost factors. Still, other localities have no rent control at all.

Landlords must carefully review their applicable local laws before deciding how much they can raise rent in New Jersey.

How much can you raise rent in New Jersey?

New Jersey does not have a statewide law governing rent increases. Rather, the state has a decentralized system that empowers municipalities to take control of this important issue at the local level. This has resulted in around 117 different sets of regulations as of 2022.

This decentralized system allows localities to tailor rent control measures as they see fit – with some adopting strict caps on increases, others tying changes to inflation indexes, and some opting for no rent regulations at all.

The lack of a uniform state law puts the power in municipal hands to decide how much flexibility landlords have in adjusting rents for their properties. On average, allowable annual rent increases range from 2% to 6% for municipalities in New Jersey with local rent control ordinances.

Let’s take a look at how diverse local ordinances can get regarding rent increase caps in New Jersey’s 5 most populous cities as provided by the Department of Community Affairs:

• Newark City – Percentage increase in Consumer Price Index (CPI) for the New York-Northern New Jersey-Long Island area 15 months and 3 months before the month of the proposed increase, not to exceed 4%.
• Jersey City – Lesser of 4% and percentage difference between CPI 3 months before expiration and 3 months before commencement of lease.
• Paterson – 5% (or 3.5% for 65+-year-old heads of households or those found to be disabled by the SS Administration)
• Elizabeth – 3% ( a larger hardship or capital improvement increase may be approved by the Board)
• Lakewood – 6.5% if landlord pays for heat / 5% if tenant pays for heat. (Optional 2-year rental increase of 9.75% if landlord pays for heat and 7.5% if tenant pays for heat)

What is the rent cap in New Jersey?

There is no statewide rent cap in New Jersey. Local rent control ordinances are enforced in 117 out of 564 municipalities, which means landlords in more than 400 municipalities may raise rent as they wish.

Don’t let the numbers shake you, however. Rent control measures tend to be more prevalent in New Jersey’s denser, more populated municipalities compared to suburban or rural areas. 

Specifically, data indicates that approximately two-thirds (66%) of New Jersey’s residential rentals equating to around 806,000 households, live in municipalities that have enacted rent control ordinances. This means a sizeable majority of renters in the state reside in towns or cities where there are local laws limiting rent increases to some degree.

As of 2022, rent caps in various rent-controlled municipalities in New Jersey ranged from 4% to 5.9%, with nearly a quarter of these municipalities setting rent increases relative to CPI.

New Jersey rent increase laws for 2025

N.J.S.A. 2A:42-84.5

Though New Jersey lacks a statewide law regulating rent increases or rent levelling, the state empowers its municipalities to adopt their own ordinances controlling rent hikes within their jurisdictions. 

However, a state statute, N.J.S.A. 2A:42-84.5, places specific limits on municipal rent control authority. This law exempts housing units constructed after June 25, 1987 from rent control measures for the first 30 years following their completion. Only once a residential property has passed this 30-year exemption period does it become potentially eligible for rent controls under the applicable local municipal ordinance. 

In essence, while New Jersey affords its towns flexibility in regulating rents, the state has carved out a significant exception shielding newer construction from such measures during the initial three decades of a building’s existence.

Transparent Disclosure of Exempt Properties

For rental properties that are exempt from rent control regulations, landlords are legally required by the New Jersey Department of Community Affairs to provide explicit notification to prospective tenants about this exemption status before entering into any lease agreement. 

Specifically, prior to a new tenant signing a lease for an exempt property, the landlord must clearly inform them that the unit is not subject to municipal rent control measures that would limit rent increases. 

This notification ensures tenants are fully aware of the lack of rent control protections before contractually committing to the lease.

How often can a landlord raise rent in New Jersey?

Landlords may only increase rent in New Jersey once during the lease term, specifically when a current lease ends and a new one commences. It doesn’t matter whether it’s a one-year lease, a two-year lease, or a month-to-month lease – the same rules apply.

No rent increase may be done once the lease is already in force. So if a landlord decides not to raise the rent at the beginning of a one-year lease, he cannot impose an increase six months later.

Rent increase notice in New Jersey by government 

Before a landlord can raise the rent in New Jersey, they must provide the tenant with a written Notice to Quit and Notice of Rent Increase.

1. Notice to Quit: This does not mean the tenant has to move out immediately. It simply ends the current rental agreement terms and allows the tenant to renew the lease.
2. Notice of Rent Increase: A notice informing the tenant about the upcoming rent increase.

The landlord has to give these notices within the timeframe specified in the lease agreement (at least 30 days in advance) or according to the local rent control ordinances (60-90 days) if any apply.

If the tenant is renting month-to-month, the landlord must give a 30-day “Notice to Quit.” This notice needs to be given on the first day of the month when rent is due.

So in summary, the landlord can’t just raise the rent without proper advance written notification ending the current rental terms and informing about the new increased rent amount. The timeframes stated in the lease or local laws must also be followed.

Landlords renting out to tenants under a Housing Assistance Payments (HAP) Contract must also seek approval from the Department of Consumer Affairs before raising rent on their property.

Single family home rent increase New Jersey

Most municipalities in New Jersey with rent control ordinances typically exempt properties with fewer than three units in a parcel of land. A single-family home is the only residential structure on a property. Hence,  it follows that these, too, are exempt from rent control provisions regarding rent increases.

Does New Jersey have rent control?

No, New Jersey has no rent control on the state level. Rather, 177 municipalities have promulgated rent caps and other rent control ordinances locally while the rest of the state’s 564 towns have no rent control at all.

Can a landlord raise rent more than 10% in New Jersey?

Yes, landlords can raise rent by more than 10% in some New Jersey municipalities with no rent control ordinances. However, landlords in municipalities with local rent control ordinances may only raise rent at an average of 2% to 6% per lease term.

What are the new rental laws in New Jersey 2023? 

Amendments to N.J.S.A. 2A:42-84.5

The New Jersey legislature enacted this law in 1987 to promote new rental housing construction by exempting newly built multi-unit dwellings from municipal rent control ordinances. This exemption was initially temporary for 5 years, then extended for another 5 years, and finally made permanent in 1997.

When first enacted, newly constructed apartments were typically financed through traditional project-based mortgages. However, more recently there has been an increase in alternative financing methods like Real Estate Investment Trusts (REITs) that do not utilize individual property mortgages.

There was confusion over whether the rent control exemption applied to new construction financed through these non-mortgage methods. To clarify the matter, an amendment specified that the 30-year rent control exemption applies to all newly constructed rental units, regardless of whether they had an initial mortgage or were financed through other means like REITs.

The intent is to facilitate new rental housing construction in New Jersey by providing a 30-year exemption from municipal rent control restrictions for any newly built multi-unit rental properties using any financing method.

How to manage your rental property and rent collection

Landlords often face challenges when collecting rent from tenants. Common issues include:

• Administrative burden of manual rent collection
• Having to manually track and record each payment received
• Late rent payments
• Missed rent payments
• Having to alert/remind tenants about late or missed payments
• Processing cash or check payments is inconvenient
• Having to make trips to the bank to deposit rent payments
• Errors in manual bookkeeping and payment tracking
• Disruptions to cash flow from late/missed payments
• Wasted time and resources on rent collection instead of other priorities

Technology and automation have revolutionized rent collection for landlords through revolutionary, all-in-one property management software like RentPost. Let’s take a look at how RentPost makes rent collection as easy as 1-2-3:

1. RentPost sends out automated payment reminders to reduce late payments. 
2. RentPost provides an online rent payment platform that allows tenants to pay rent electronically.
3. RentPost automatically calculates late fees according to pre-determined schedules.
4. Payments are automatically recorded in RentPost’s manager platform to eliminate manual tracking.
5. Payments are directly deposited into the landlord’s registered account on the RentPost platform, saving trips to the bank. 
6. RentPost generates comprehensive digital reports to minimize errors and provide real-time information on rent collection status for individual units/owners. 

Overall, RentPost property management software centralizes and automates the entire rent collection operation to boost efficiency and improve cash flow for landlords.

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