Proposed legislation would ban landlords from using software that coordinates rental pricing across competing properties.
Trenton, NJ – New Jersey lawmakers have introduced legislation aimed at stopping landlords from using algorithm-driven software that critics say allows property owners to coordinate rent increases and reduce competition in the housing market.
Assembly Bill A3497, sponsored by Assemblywoman Yvonne Lopez along with Assemblywoman Margie Donlon and Assemblyman Chigozie Onyema, would make it illegal for landlords to use certain property management software that recommends rental pricing based on shared data from multiple property owners.
Key Points
• NJ bill would prohibit landlords from using rent-setting algorithms that coordinate pricing
• Software companies that analyze landlord data to recommend rent increases would also be banned
• Violations would be prosecuted under New Jersey’s antitrust law
The legislation targets companies that provide rental price recommendation software to property owners. Lawmakers argue the systems collect private market data from multiple landlords and use algorithms to suggest rental prices, potentially allowing property owners to raise rents in coordination.
Under the bill, landlords would be prohibited from subscribing to or contracting with a company that performs what the legislation calls a “coordinating function.”
That function includes collecting nonpublic rental data, analyzing the information through automated systems or algorithms, and recommending rent prices, lease renewal terms, or occupancy levels.
Law would classify coordinated pricing as antitrust violation
The legislation would also prohibit what it calls “consciously parallel pricing coordination,” defined as an agreement—either explicit or informal—between property owners to manipulate rental prices for residential units.
Any violation would be treated as a violation of the New Jersey Antitrust Act, exposing landlords or software companies to enforcement actions by state authorities.
The bill clarifies that the restrictions would not apply to landlords managing multiple properties they own themselves or to real estate multiple listing services.
Lawmakers cite rising rents and housing affordability crisis
Supporters of the legislation say the measure is needed as New Jersey faces increasing housing costs and affordability challenges.
According to findings included in the bill, median rent for a three-bedroom apartment in New Jersey increased 35 percent between 2021 and 2024, while studio apartment rents in cities like Hoboken rose 61 percent during the same period.
Data cited in the legislation also indicates that more than half of renters in New Jersey are considered “rent burdened,” meaning they spend more than 30 percent of their income on housing.
If enacted, the law would take effect four months after passage, and the state Department of Law and Public Safety and the Department of Community Affairs would launch a public education campaign to inform residents about the new rules.
Tags: new jersey legislature, new jersey housing, rent prices