Refusal to Pay Rent Increase
If a tenant refuses to pay the rent increase and remains at the rental unit after the old lease
expires (establishing new tenancy), the landlord may file a legal action in Superior Court to have
the tenant evicted for failure to pay the rent increase. The landlord is not required to give the
tenant notice before filing an eviction action for non-payment of the rent increase.
Unconscionable Rent Increase
If the tenant refuses to pay the rent because the tenant believes the rent increase is
unconscionable or unreasonable, the tenant may withhold a portion of the rent. The tenant may
withhold the difference between the old rent rate and the new increased rate. However, the
landlord may take the tenant to court based on non-payment of rent increase, if this happens, the
tenant may argue to the judge that the increase is unconscionable. The landlord has the burden
of proving to the court that the rent increase is fair and not unconscionable.
Note: If the tenant chooses not to pay the rent increase he should continue to pay the regular
rent and be prepared to pay the full amount of the rent increase if the court rules in the
landlord’s favor.
Determining if a Rent Increase is Unconscionable
In Fromet Properties Inc. v. Dolores Buel, et al., the court found that in determining
unconscionability, the trial judge may consider: 1) the amount of the proposed rent increase; 2)
the landlord’s expenses and profitability; 3) how the existing and proposed rent compare to rents
charged at similar rental properties in the geographic area; 4) the relative bargaining position of
the parties; and 5) based on the judge’s general knowledge, whether the rent increase would
shock the conscience of a reasonable person.
Rent Control
The State of New Jersey does not have a law governing rent increases. However, municipalities
within the State may adopt ordinances regulating the amount and frequency of rent increases
within their specific municipality. A municipality’s ordinance may not cover all rental units. To
find out if a rent control ordinance exists, and if it applies to a specific rental unit, contact the
municipal clerk in the municipality where the rental premises is located. (See Attachment B,
Rent Control Survey.)
Exemption from Rent Control
Pursuant to N.J.S.A
. 2A:42-84.2 through 2A:42-84.6, certain newly constructed multiple
dwelling units may be exempt from rent control ordinances. Prior to entering into any lease for
tenancy, the landlord of an exempt property must notify the prospective tenant that the rental unit
is exempt from rent control. (See Attachment C, Newly Constructed Multiple Dwelling Law)
Public Financed and Subsidized Housing
Housing Developments owned or subsidized by the U.S. Department of Housing and Urban
Development (HUD), the New Jersey Housing and Mortgage Finance Agency (HMFA) or
regulated by the N.J. Public Housing and Development Authority are not subjected to municipal
rent control ordinances. For proper procedures for notice and comments on rent increase for
HUD buildings, call (973) 622-7900, ext. 3400 and (609) 278-7400 for HMFA buildings.