The New Jersey Assembly Housing Committee voted 5-2 to advance a bill to ban rent-setting algorithms such as Real Page at yesterday’s hearing, as well as voting unanimously (7-0) to move a bill to determine unconscionable rent increases.
By John Heinis/Hudson County View
“If we want to make New Jersey more affordable, we need to ensure renters aren’t getting priced out of their homes. When rent increases dramatically without clear justification, it can destabilize families and entire communities,” Assemblywoman Yvonne Lopez (D-19), a primary sponsor of both bills, said in a statement.
“The bills advanced [yesterday] would help to make sure renters have protections in place and that the market operates in a way that works for everyone, not just those looking to make money.”
Bill A-3497 is intended to address the use of rental pricing algorithms, like RealPage, and the impact these algorithms have on the overall rental market.
Also sponsored by Assemblywoman Margie Donlon (D-11) and Assemblyman Chigozie Onyema (D-28), the legislation would prohibit certain coordination among residential rental property owners that restricts competition in the rental housing market.
The legislation targets the use of third-party software platforms that collect nonpublic rental information from multiple landlords and use algorithms to recommend rent increases, thus artificially driving up costs for renters.
The state measure is similar to ordinances approved by the Jersey City and Hoboken City Councils last year, both as HCV first reported.
Additionally, Bill A-3507, sponsored by Lopez and Assemblyman Cody Miller (D-4), would create standards for determining unconscionable rent increases.
Among the strong tenant protections that New Jersey has on the books is a statutory limitation on “unconscionable rent increases.”
Although in theory this protection should put a check on substantial rent increases, the standard for what qualifies as an unconscionable rent increase is largely undefined. This bill would codify the test for determining whether a rent increase is unconscionable.
In addition to evaluating rent increases, the bill also includes provisions to protect tenants’ privacy by limiting public access to outdated eviction records, particularly in cases where no judgment for possession was ever entered or where judgments are more than seven years old.
Bill A-3497 cleared the committee 5-2, with Assemblywoman Vicky Flynn (R-13) and Assemblyman Robert Clifton (R-12) voting no, while Bill A-3497 was approved unanimously (7-0).
Jersey City Apartment Owners Association Executive Director Wendy Paul said state officials efforts may be well-intentioned, but are still misguided.
“New Jersey legislators want to ban data algorithms. Instead, they should make sure New Jersey’s tough consumer protection laws — which already prohibit illegal collusion practices — are strictly enforced,” she said in a statement
“That’s exactly why Colorado Democratic Governor Jared Polis vetoed similar legislation last year, saying: ‘We should not inadvertently take a tool off the table that could identify vacancies and provide consumers with meaningful data to help efficiently manage residential real estate to ensure people can access housing.’ Gov. Polis is right and New Jersey lawmakers should pay attention to him and support policies which encourage the use of data driven productive resources for housing.”
