Top 10 Things to Know as a New Jersey Landlord

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By Larry M. Centanni, Esq.

When it comes to landlord-tenant law in New Jersey, the rules are spelled out pretty clearly. There are certain rules that landlords must abide by and the same is also true for tenants. The purpose of the law is to protect all parties involved in rental situations.

One of the best things landlords can do to best protect themselves is to become familiar with New Jersey Landlord-Tenant law. The State of New Jersey Department of Community Affairs website is a great resource for getting started in familiarizing yourself with landlord-tenant law in the garden state.

By learning about your responsibilities and rights as a landlord in New Jersey, you can best protect yourself from experiencing conflict and running into issues with your tenants. Here’s a look at the top 10 things you should know as a New Jersey landlord to get you started on the right path.

  1. Truth In Renting

One of the main publications in New Jersey regarding landlord-tenant law is entitled Truth in Renting. According to New Jersey Law, landlords are required to provide a copy of Truth in Renting to their tenants.

The aforementioned website for the State of New Jersey Department of Community Affairs offers copies of the document in both English and Spanish to make it easy for landlords to comply with this part of the law. This is an easy part of the law to follow. Simply provide your tenants with a copy of this guide prior to move-in when they sign their lease agreement.

  1. Adhere to Anti-Discrimination Laws

Fair housing laws outline what you can say and do when you select tenants to reside in your rental property. These laws also outline how you advertise a rental and even the questions you are allowed to ask on an application to rent.

In addition to the New Jersey Law Against Discrimination (LAD), there is also the federal Fair Housing Act. Both are meant to protect renters or potential renters from discrimination by landlords. Read both of these laws so you understand what your rights and responsibilities are as a landlord.

These laws prohibit housing discrimination based on actual or perceived instances of the following:

  • Race or color;
  • Religion or creed;
  • National origin, nationality, or ancestry;
  • Sex, pregnancy, or breastfeeding;
  • Sexual orientation;
  • Gender identity or expression;
  • Disability;
  • Marital status or domestic partnership/civil union status;
  • Liability for military service;
  • Familial status;
  • Source of lawful income used for rental payments.

Know that landlords are legally able to reject a potential renter’s application for several reasons including bad credit history, negative references from previous landlords, and past rental behavior such as paying rent late. These are all factors that could make them a risk when it comes to renting to them.

  1. Follow Rules for Security Deposits and Returns

Disputes regarding security deposits are common between landlords and their tenants. Per New Jersey law, landlords may charge a security deposit equivalent to one and one-half month’s rent for the security deposit. Additionally, an additional security deposit may be required annually but it can be no more than 10 percent of the current security deposit.

For example, if the monthly rent is $1,200, then the original security deposit can be up to $2,000. If the landlord requires an additional security deposit upon lease renewal, then they can ask for up to 10 percent, or $200, each year.

How the security deposit is held by the landlord is also outlined in New Jersey law. The funds can be invested in shares of an insured money market fund establishes by an investment company based in New Jersey or may be deposited into a state or federally-chartered bank or savings and loan.

Security deposits must be returned within 30 days of the termination of a tenant’s lease by personal delivery or by registered or certified mail. All of the deposit should be returned “less any charges expended in accordance with the terms” of the lease agreement.

To avoid disputes over security deposits, we also recommend sending the tenant a written security deposit itemization when the tenant leaves. This will help them understand why a portion or all of the security deposit funds were withheld if that is the case. Remember, landlords cannot withhold funds for the security deposit for things that would be considered “normal wear and tear” such as worn carpets resulting from average traffic.

  1. Ensuring Habitable Housing

New Jersey law requires landlords to keep rental properties livable. This falls under a legal doctrine known as an “implied warranty of habitability.” This includes ensuring reliable heat, sturdy floors and walls, reasonable security measures, sufficient hot water, a roof that keeps out rain and snow, and more.

A landlord’s responsibility to maintain a livable rental cannot be waived. Landlords are not legally able to reduce their habitability responsibilities in any part of the lease agreement such as in a “disclaimer.” When a landlord’s inattention or negligence leads to a problem that would cause a reasonable tenant to fear for their health or safety, the landlord is in breach of the “implied warranty of habitability” law.

  1. Stick to State Rental Laws

While it may seem reasonable to expect that all of your tenants will pay their rent on time without a hitch, it’s also unlikely. At some point, you may find a tenant is not paying their rent on time. This may lead you to increase the rental fee or evict them.

Before you can do those things, you will want to ensure that you are fully compliant with New Jersey law. New Jersey landlord-tenant law regulates several rent-related and eviction issues. Both require a process that must be adhered to and require timely notification of changes being made by the landlord.

For example, a landlord must give written notice within the timeframe outlined in the rental agreement of at least 30 days or the timeframe designated by local rent control ordinances if they intend to raise the rent. Even if a tenant is on a month-to-month lease, they, too, must be given a 30-day notice.

Additionally, increases in rent may not be so much so that a court may deem them “unconscionable or unreasonable.” A tenant may withhold a portion of the rent at which time the landlord may file a complaint with the court regarding the amount being withheld. If the landlord does this, they bear the burden of proving that the rent increase is fair and not unconscionable.

Whatever the issue may be, it’s imperative that landlords adhere to local, state, and federal landlord-tenant laws. Not doing so puts them at great risk of ending up on the wrong side of the law.

  1. Written Lease Agreements

The rental agreement you bring to the table is a legally binding contract between you, the landlord, and your tenant(s). It contractually outlines the rules and regulations of your relationship as landlord and tenant. This includes business details such as the length of the lease, how much rent is and when it is due, as well as the security deposit and more.

Illegal clauses included in leases by landlords can create serious issues. This includes a waiver of responsibility by the landlord for maintaining a habitable rental or failing to disclose legally required information such as potential environmental hazards such as lead-based paint.

It is imperative that landlords, especially those new to the role, need to seek legal assistance to draft a law-abiding, legally binding, airtight lease agreement. The right lease agreement will outline the rights and responsibilities of both the tenant and the landlord while adhering to local, state, and federal law. This is where the assistance of an experienced real estate attorney such as those at the Law Office of Lawrence M. Centanni is really worth their weight in gold.

  1. Required Disclosures

Just as mentioned above, state law must be followed and there are several disclosures that landlords must make. New Jersey state law requires that landlords make certain disclosures as does federal law.

New Jersey state law requires the following disclosures by landlords, in addition to several others:

  • Details about security deposits such as how long it will be held, whether it will earn interest, and how long the landlord has to return it once the tenancy ends.
  • Whether the landlord will charge nonrefundable fees such as a cleaning fee once the tenancy ends.
  • Any existing damages to the rental property along with a move-in checklist.
  • The tenant’s right to be present at the move-out inspection.
  • Shared utility arrangements.

There are also federal disclosures that must be made including a required disclosure regarding lead-based paint. If a landlord does not disclose this information, they could face serious financial penalties. There are some exceptions to some of these disclosures, but it is highly recommended to seek legal counsel before eliminating any disclosures from your rental agreement.

  1. Remain Calm and Carry On

When it comes to tenants who exercise their legal rights, retaliation is illegal in New Jersey. For example, raising the rent or evicting a tenant who has complained about an unsafe living condition is illegal.

As a landlord, it’s imperative to keep a good paper trail and make a good-faith attempt to make necessary repairs or improvements as part of the implied warranty of habitability mentioned above. Documenting how repairs have been handled, who made them, and the cost and date will help support you should there be any legal disagreement.

Remember to remain calm and carry on while maintaining a good paper trail. A ledger of repair requests and when they were made by whom will also be quite helpful. These facts will make a huge difference if problems arise or escalate to a courtroom battle. Such documentation will also be helpful in documenting damages should you have to withhold a portion or all of the security deposit.

  1. Follow the Law for Evictions

No one enjoys having to go through an eviction with a tenant. Not only will the tenant be left unhappy, but it also requires a great deal of paperwork and patience on the part of the landlord.

New Jersey landlord-tenant law strictly outlines when and how a landlord may terminate a tenancy. Should a landlord fail to follow the legal rules outlined by the law regarding evictions could result in delays in ending a tenancy. For more information about termination notices, see State Laws on Unconditional Quit Terminations and State Laws on Termination for Violation of a Lease. For more specific questions regarding an eviction, we recommend that you seek legal counsel from an experienced real estate attorney.

  1. Landlord Resources

There are many resources available to landlords and tenants alike. We recommend that you do your homework by checking books for landlords and visiting government agencies online such as the U.S. Department of Housing and Urban Development (HUD), and the State of New Jersey Department of Community Affairs. The New Jersey Courts also offer quick access to all Landlord-Tenant forms online as well.

Landlords can often find such resources for free or at low cost such as a landlord checklist can help make becoming a landlord and maintaining the law much simpler. Such forms are available online or you can reach out to the Law Office of Lawrence M. Centanni.

For more information about your rights and responsibilities as a landlord in New Jersey or for assistance with forms such as rental agreements, eviction issues, or other tenancy problems, contact the real estate attorneys at the Law Office of Lawrence M. Centanni at (908) 351-0028 to schedule an initial consultation.

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