New Jersey Allows Local Rent Control (No Statewide Preemption)

New Jersey sets no statewide limit on residential rent increases. Instead, rent control is governed locally: in Inganamort v. Borough of Fort Lee, 62 N.J. 521 (1973), the New Jersey Supreme Court held that rent control is a legitimate exercise of municipal police power and is not preempted by state law. Roughly 117 of New Jersey's 564 municipalities now have rent-control ordinances, concentrated in Hudson, Essex, Bergen, and Middlesex counties. Newark and Jersey City cap most annual increases at CPI up to about 4%; Hoboken ties increases to CPI; Paterson generally limits increases to 5% (3.5% for seniors/disabled tenants); East Orange and Fort Lee use roughly 5% caps. The only statewide limit is narrow: state law exempts newly constructed multifamily housing from local rent control. Outside covered municipalities, rent is set by lease and market.

Penalties are set by each municipal ordinance, not by state statute. A landlord who charges above a town's allowable increase typically must roll the rent back, refund the overcharge, and may face local fines or be barred from collecting the excess. Where no local rent-control ordinance applies, there is no penalty tied to the size of an increase.