Establishes "Forbidding the Algorithmic Inflation of Rent (FAIR) Act." *

A3497 1R ACS

[First Reprint]

ASSEMBLY COMMITTEE SUBSTITUTE FOR

ASSEMBLY, No. 3497

STATE OF NEW JERSEY

222nd LEGISLATURE

�
ADOPTED
JUNE 8, 2026

Sponsored by:

Assemblywoman� YVONNE LOPEZ

District 19 (Middlesex)

Assemblywoman� MARGIE DONLON, M.D.

District 11 (Monmouth)

Assemblyman� CHIGOZIE U. ONYEMA

District 28 (Essex and Union)

Assemblywoman� KATIE BRENNAN

District 32 (Hudson)

Senator� BRIAN P. STACK

District 33 (Hudson)

Senator� M. TERESA RUIZ

District 29 (Essex and Hudson)

Co-Sponsored by:

Assemblywoman Peterpaul, Assemblyman Sampson, Assemblywoman
Haider, Assemblymen Singh, Kearney, Assemblywoman Quijano, Assemblymen
Verrelli, Stanley, Assemblywomen Speight, Bagolie, Senators McKnight, Mukherji,
Wimberly, Cryan and McKeon

SYNOPSIS

���� Establishes �Forbidding the Algorithmic Inflation of
Rent (FAIR) Act.�

CURRENT VERSION OF TEXT

���� As reported by the Assembly State and Local
Government Committee on June 23, 2026, with amendments.

��

An Act
concerning residential rental property pricing
and supplementing P.L.1970, c.73 (C.56:9-1 et seq.).

����
Be It Enacted

by the Senate and General Assembly of the State of New Jersey:

���� 1.��� This act shall be known
and may be cited as the �Forbidding the Algorithmic Inflation of Rent (FAIR)
Act.�

���� 2.��� The Legislature finds
and declares that:

���� a.���� New Jersey is in the
midst of an affordable housing crisis, as demonstrated by rental housing
industry data showing median rent for a three-bedroom apartment increasing by
35 percent in the State from 2021 through 2024 and a studio in a more urban
environment such as Hoboken increasing by 61 percent in the same timeframe.

���� b.��� Data from the United
States Census Bureau indicates that over 50 percent of renters in New Jersey
are deemed �rent burdened,� which means an individual spends more than 30
percent of income on rent.

���� c.���� Recent national data
indicates that landlords of residential rental housing use property management
software to collude to restrain trade and raise residential rental housing
prices, which has contributed to recent increases in the State.

���� d.��� Landlords engaging with
the software supply real-time prices and additional lease information to
companies managing the software, who proceed to use algorithms to fix rental
prices. As a result, competition decreases and rental prices increase.

���� e.���� A leading property
management software company in the United States hinted at the outcome of using
its software by stating on its website that it enables landlords to �outperform
the market� by up to seven percent, with a company executive publicly stating
that the software could be responsible for rent increases of up to 14.5
percent.

���� f.����
Property management software companies and landlords who use algorithmic
systems that serve a coordinating function have been subject to public and
private litigation for alleged violation of existing State and federal
antitrust law.

���� g.���
Although
the form of restraint of trade has evolved, the vital role of antitrust law in
maintaining the competitive function of the free market remains.

���� h.��� New Jersey recognizes
housing as a basic human need and endeavors to expand access to affordable
housing.

���� 3.��� As used in this act:

���� �Affordability controls� means
a restriction on rent price established pursuant to a government program,
including but not limited to: the federal section 8 Housing Choice Voucher
Homeownership Program, authorized pursuant to Subpart M of Part 982 of Title 24
of the Code of Federal Regulations (24 CFR 982.601 et seq.); P.L.2004, c.140
(C.52:27D-287.1 et seq.); the �Fair Housing Act,� P.L.1985, c.222 (C.52:27D-301
et al.); any program administered by the New Jersey Housing and Mortgage
Finance Agency; a rent control or rent leveling ordinance; or other local,
State, or federal government housing program.

����
1
�
Algorithmic
device� means a device that uses one or more algorithms to process or otherwise
perform calculations of data, including, but not limited to, data concerning
rental prices, material lease terms, or occupancy levels.� An algorithmic
device does not include: (1) a spreadsheet that (a) operates without artificial
intelligence and (b) requires human analysis to process or otherwise perform
calculations of data; or (2) a database that only uses an algorithm to query
unprocessed data stored on or within that database
.
1

�����
�Competitively
sensitive information� means nonpublic information including, but not limited
to, prices, supply levels, security deposits, ideal occupancy levels, lease
contract termination, renewal dates of residential dwelling units, or any other
material lease terms.

���� �Coordinating function� means:

���� (1)�� collecting the
competitively sensitive information of two or more rental property owners for
the purpose of analyzing or processing information through the use of an
algorithm or other automated process, including by using the information to
train an algorithm, where the algorithm or other automated process is used to
set or recommend rental prices, material lease terms, or occupancy levels;

���� (2)�� setting rental prices,
material lease terms, or occupancy levels pursuant to an underlying algorithm
or other automated process that analyzes or processes competitively sensitive
information of any other rental property owner, including by using that competitively
sensitive information to train an algorithm; or

���� (3)�� setting for or
recommending to two or more rental property owners: rental prices, material
lease terms, or occupancy levels pursuant to the same or a substantially
similar underlying algorithm or other automated process, that facilitates
parallel pricing coordination.

���� �Coordinating function� shall
not include the following:

���� (1)��
providing, using, or collecting
competitively sensitive information solely for the purpose of conducting
research, statistical analysis, or testing, where the competitively
sensitive information is not used in setting or recommending rental prices,
material lease terms, fees, occupancy rates or levels, or other contract terms
for current or future leases;

���� (2)��
developing an estimated amount of rent that is
made available to the public at no cost;

���� (3)��
the use of a real estate brokerage
database that is available on equal terms to subscribers that lists properties
for rent or sale but does not:

���� (a) set or recommend rental
prices, material lease terms, or occupancy rates or levels; or

���� (b) collect competitively
sensitive information to set or recommend rental prices, material lease terms,
or occupancy rates or levels; or

����
(4)�� a government entity
setting or limiting rents or sale prices of residential property through
affordability controls in accordance with the law.

���� �Coordinator� means any person
who operates
1
[
a software or
data analytics service
]

algorithmic revenue management software or an algorithmic device
1
that
performs a coordinating function for any rental property owner, including a
rental property owner performing a coordinating function for their own benefit.
�Coordinator� shall not include a government entity that sets or limits rents
or sale prices of residential property through affordability controls in
accordance with law.

���� �Nonpublic information� means
information that is not available to the public at no cost. In instances where the
information is combined with public information, all combined information shall
be deemed nonpublic information.

���� �Person� means, unless the
context requires otherwise, any natural person or persons, or any corporation,
partnership, company, trust, or association of persons.

���� �Parallel pricing
coordination� means a tacit or express agreement between two or more rental
property owners to raise, change, maintain, or manipulate pricing for the
leasing of reasonably interchangeable residential dwelling units, unless
required to do so in accordance with affordability controls.� This includes
agreements between a coordinator and multiple property owners.

����
1
�Rental
property owner� means a person that owns, directly or indirectly, one or more
rental residential dwelling units.� Any person that holds a controlling
interest in an entity that owns a rental residential dwelling unit shall be
deemed to constitute a single rental property owner with that entity.
1
����

���� �Residential dwelling unit�
means any house, apartment, accessory unit, or other unit intended to be used
as a primary residence in the State. �Residential dwelling unit� shall not
include inpatient medical care, licensed long-term care, or detention or correctional
facilities.�

���� �Tacit agreement� means mutual
consent demonstrated without verbal or written communication.� Mutual consent
may, but need not, be demonstrated by a pattern of conduct.

�����
4.��� It shall be
unlawful and a violation of the �New Jersey Antitrust Act,� P.L.1970, c.73
(C.56:9-1 et seq.) for:

���� a.���� a rental property
owner, or any agent, representative, or subcontractor thereof, to receive,
subscribe to, contract for, or otherwise exchange any form of consideration in
return for the use of, the services of a coordinator;

���� b.��� a coordinator to
facilitate a tacit or express agreement among rental property owners that
restricts competition with respect to residential dwelling units, including by
performing a coordinating function;�

���� c.���� two or more persons to
engage in
1
or
otherwise facilitate
1

parallel pricing coordination;

���� d.��� any agent or
representative of a coordinator or subcontractor thereof to engage in parallel
pricing coordination; or

���� e.���� any person to perform a
coordinating function.

���� 5.��� The provisions of this
act shall not be construed in any manner that limits the application of
sections 6 through 17 of P.L.1970, c.73 (C.56:9-6 through 9-17) to a violation
of section 4 of this act.

���� 6.��� a. �This act shall not
authorize or permit any conduct already unlawful pursuant to the �New Jersey
Antitrust Act,� P.L.1970, c.73 (C.56:9-1 et seq.), or any other law, and shall
be construed as in addition to that act.

���� b.��� A municipality shall be
prohibited from enacting an ordinance that conflicts with this act.� This
subsection shall not be construed to prohibit the enactment of ordinances
explicitly authorized or required by any other law.

���� 7.��� The Attorney General
shall establish, on the official website of the Department of Law and Public
Safety, a location to receive complaints alleging any violation or suspected
violation of this act, which requirement may be satisfied by establishing or maintaining
such a location for complaints alleging violations or suspected violations of
the �New Jersey Antitrust Act� P.L.1970, c.73 (C.56:9-1 et seq.).

���� 8.��� The Attorney General
may, pursuant to the �Administrative Procedure Act,� P.L.1968, c.410
(C.52:14B-1 et seq.), adopt any rules and regulations to effectuate the
purposes of this act.

���� 9.��� This act shall take
effect on the first day of the twelfth month next following the date of
enactment.