Landlords Will Now Have To Justify 10 Percent Rent Increases In Hoboken

HOBOKEN, NJ — The state of New Jersey says that landlords — whether subject to local rent control ordinances or not — shouldn't raise rents by an amount that's "unconscionable or unreasonable." However, the state also leaves it up to a tenant to plead their case in court if they want to fight.

The state has not defined what kind of increase is "unreasonable or unconscionable," making for a murky situation.

Last year, the city of Hoboken proposed an ordinance to restrict all increases to 10 percent at most, but the measure failed in a narrow vote.

On Wednesday night, the city took a different tack: they voted 8-0 to add language forcing landlords to justify an annual increase of 10 percent or more.

Councilman Joe Quintero said the aim of the ordinance is "increasing transparency and protecting tenants from excessive rent hikes."

The law was co-sponsored by council members Emily Jabbour and Phil Cohen.

The ordinance — Mandatory Disclosures for Certain Rent Increases — requires landlords to provide detailed disclosures when increasing rent by more than 10 percent for lease renewals.

The law, which takes effect in 20 days, says landlords seeking to impose rent hikes over 10 percent must furnish tenants with:

• An itemized breakdown of costs associated with the increase;
• A statement on whether a rent algorithm was used to determine the new rental rate;
• A notification of the tenant's right to legal action if they believe the increase is unconscionable or unlawful; and
• Contact information for the Hoboken Division of Housing and Tenant Advocate for further guidance.

A national debate has raged in the last several years over "rent algorithms" used by corporate landlords who base their increases not on the local market, but on software. (Read more about that here.)

The city has a tenant advocate to give free advice to renters with legal questions. (Make an appointment here.)

Hoboken also has a Rent Control Ordinance in place that limits rents in many older and some newer buildings, but doesn't apply to all.

Rents Among The Highest

In recent years, residents of some buildings have complained about increases of 15-30 percent, forcing them to potentially uproot their families.

Studies have put Hoboken rents and annual rent increases among the highest in the nation.

Quintero said Thursday, "As housing affordability continues to be a major concern for our residents, this ordinance ensures greater transparency and provides tenants with the information they need to make informed decisions about their homes. While we recognize that landlords may need to raise rents due to rising costs, tenants deserve to understand why their rent is increasing and what their rights are."

Landlords who fail to provide the required disclosures may face fines of up to $1,000 per incident.

While the amount may not be enough to dissuade a landlord who can raise the rent by more than $1,000 a month, Quintero noted that tenants can still fight their landlord in court. Now, they may have more information about the process, and a law

"The ordinance is part of the City of Hoboken’s broader efforts to support renters and promote housing stability," said a press release.

Quintero said that the city will make sure landlords and renters are aware of the law, letting them know via Nixle, social media, and mailing the information each year with tax notices.

Unaware of the state and city laws protecting renters from eviction or unconscionable rent hikes? Find out more here: Longtime Hoboken Renters Fear Demolition, Displacement