Housing providers must consider the impact of rent hikes on tenants, comply with local and statewide laws, and manage their cash flow effectively. It’s essential to assess your investment property goals, ensuring worthwhile profits.
In this guide, we’ll dive into where to look for local rent increase rules, how much notice is sufficient, and steps you can take to determine a new rental rate and gracefully raise the rent to retain quality tenants.
2024 updates to New Jersey’s rent increase guidelines
New Jersey currently has no statewide rent control laws. However, cities can enforce their rent control ordinance.
To help determine if the city you’re in has rent control rules or if rent control laws apply to a specific rental unit, reach out to the municipal clerk in the area of the rental property.
In case the tenant resides in an approved rental unit under the Housing Choice Voucher Program (HCV), the landlord must submit a rent increase request to the Department of Community Affairs (DCA).
How to raise rental rates in New Jersey
The ideal approach to rental increases is to collect a solid foundation of data, making the process less daunting and ensuring your real estate investment is profitable. Follow these steps to avoid sticky or awkward situations and streamline the process.
Step one: Determine your new rental rate
Research the rental market trends and market-rate prices, and write down your rental income goals. Once you’ve budgeted your cash flow from the lease term and your projected maintenance and repair expenses, you can set a new rental rate.
Step two: Prepare the notice of rent increase
Be thorough about documentation. Prepare an email notifying your tenants of the rent adjustment to your rental properties. If you draft a new rental agreement, adjust the new rent amount. Hyperlink the rent increase notice in an email to the tenant and include all necessary forms.
Step three: Notify your tenant of the rent hike
Landlords must give tenants a 30-day rent increase notice, so plan ahead before the lease period ends.
Resolving issues about rent control
Property owners should handle rent increase notifications with finesse when informing their tenants about an uptick in rent. Soften the impact by attentively listening to your tenants’ concerns and communicating the reasoning behind the adjustment. Whether it’s because the current rent is below the market rates or your property taxes and cost of living have increased, transparency will foster understanding.
The following New Jersey rental sources will guide you through proper landlord-tenant legal procedures, allowable rent increases on specific residential properties, and HCV-approved rental units:
FAQ: New Jersey rent increase guidelines for landlords
There are no statewide limitations on rent increases in New Jersey. However, each city has the authority to implement its own rent control limits. Every landlord should research their local rent increase limit to see if the laws apply to their property or housing unit. Additionally, landlords should stay informed about new rental bills passed following legislative sessions.
New Jersey’s rent increase laws state that a landlord cannot increase the rent during the existing lease. If the fixed-term lease has ended and you entered a month-to-month lease, you must give the tenant 30 days’ notice before raising the rent.
When the 12-month lease term expires, if the tenant continues to pay rent and the landlord collects the rent, the lease can enter into a month-to-month agreement. The landlord must provide proper notice if they wish to raise the rent. In New Jersey, 30 days’ notice is required.
Our final thoughts
New Jersey rent control laws are relatively straightforward. Ensure you check with your city’s municipal rent control ordinance to learn about local laws and be transparent with your tenants to maintain a good relationship.
While landlords aren’t obligated to explain rent hikes, addressing tenant concerns or clarifying the necessity fosters understanding and builds a solid tenant-landlord relationship.
Follow the link for New Jersey’s rental documents and get access to all the documents a landlord needs, from rental applications, tenant screening information, rental agreements, inspection forms, and sufficient notice of intent to enter premises when you need to inspect or schedule repairs.
