New Jersey Tech, Business, & Creative Resources
New Jersey has officially made it illegal for landlords and property management companies to use artificial intelligence and algorithmic software to coordinate rent prices.
Governor Mikie Sherrill signed the Forbidding the Algorithmic Inflation of Rent (FAIR) Act into law on July 20, 2026, making New Jersey the fourth state in the nation to explicitly regulate algorithmic price-fixing in the residential housing market.
How Algorithmic Rent Coordination Works
The legislation directly targets software programs—most notably RealPage—that gather nonpublic, competitively sensitive data from surrounding landlords to recommend dynamic rental prices and occupancy targets. State officials and housing advocates contend that while property owners once competed to offer fair prices, these shared digital systems allow them to act as a cartel, raising rents simultaneously across entire cities and neighborhoods.
Data highlighted by the White House Council of Economic Advisers indicates that rent-setting software increased monthly rents by an average of $70 per unit in buildings using the tools, adding billions in artificial costs to American households.
“Landlords, who should be competing to provide the best price to renters, are instead colluding to drive prices up through so-called ‘algorithmic pricing,'” Governor Sherrill said during the bill signing in Newark. “That stops now.”
Key Provisions of the FAIR Act
- Prohibits Coordinated Data Pooling: Landlords may not subscribe to or use software that relies on nonpublic competitive data from competing property owners to set rents or manage unit availability.
- Tied to State Antitrust Laws: Violations are classified as illegal restraints of trade under the New Jersey Antitrust Act, opening up non-compliant landlords and software providers to major legal enforcement.
- Consumer Complaint Portal: Directs the New Jersey Attorney General’s Office to establish an online reporting system where tenants can report suspected algorithmic price coordination.
- Targeted Scope: Ordinary spreadsheets, publicly available research, government affordable housing formulas, and independent pricing software that does not share private competitor data remain completely legal.
Impact on Tenants and the Housing Market
The bill received strong backing from tenant advocacy groups and primary sponsors, including Assemblywoman Katie Brennan (D-Jersey City), Senate Majority Leader M. Teresa Ruiz (D-Essex/Hudson), Senator Brian Stack, and Assemblywoman Yvonne Lopez (D-Middlesex).
“No one should have to bid against a machine designed to squeeze every last dollar out of them,” said Assemblywoman Brennan, who made banning algorithmic rent gouging a focal point of her housing platform.
While housing experts emphasize that New Jersey’s broader housing shortage remains a root driver of elevated costs, the FAIR Act prevents tech-driven collusion from further exacerbating the state’s affordability crisis.
The law takes effect on July 1, 2027, giving landlords and property management firms a 12-month grace period to transition away from prohibited revenue-management software.
Sources and References
- Governor Sherrill Official Press Release — FAIR Act Signing
- The Jersey Vindicator — New Jersey Bans AI-Powered Rent-Setting Software Used by Landlords
- Insider NJ — Forbidding the Algorithmic Inflation of Rent (FAIR) Act Signed into Law
- Homes.com Real Estate News — New Jersey Governor Signs Law Banning Rent-Setting Algorithms
- Morristown Minute — New Jersey Bans Algorithmic Rent Coordination
