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Gov. Mikie Sherrill signed a law on July 20 that starting next summer will restrict landlords from using algorithms to set rents, a practice state officials said helped drive up costs through unlawful coordination.
Taking effect on July 1, 2027 the FAIR — Forbidding the Algorithmic Inflation of Rent — Act will prohibit landlords from using software the recommends rents by assessing private data shared by competing landlords. This includes things like rental prices, housing supply, occupancy levels and lease termination dates.
"The problem is that these tools put competing landlords on the same team against renters," Sherrill said at the bill signing. "Landlords can use these algorithms to coordinate prices, move in lockstep and push rents higher and higher. It's collusion by algorithm, and it's illegal."
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The law follows growing concern of property management software like RealPage, an AI-powered operating system for multifamily property management. New Jersey filed a lawsuit against the company in April 2025 for allegedly "conspiring" to drive up residential rent prices in violation of federal and state laws. Other states and the U.S. Department of Justice have also sued the company.
In one of the lawsuits, RealPage and several landlords agreed to a nearly $360 million settlement, but denied wrongdoing. And under that settlement, the company agreed to stop using certain private information to generate rent recommendations and to eliminate features that aligned rents among competing landlords.
"Rents in New Jersey are already far too high. But when landlords and tech companies conspire to artificially inflate rents, they make it even more difficult for hardworking New Jerseyans to find housing they can afford. That’s why I’m grateful to Governor Sherrill and the Legislature for their leadership in protecting New Jersey renters from rising housing costs through the FAIR Act,” New Jersey Attorney General Jennifer Davenport said in a statement.
Maddie McGay is the real estate reporter for NorthJersey.com and The Record, covering all things worth celebrating about living in North Jersey. Find her on Instagram @maddiemcgay, on X @maddiemcgayy, and sign up for her North Jersey Living newsletter. Do you have a tip, trend or terrific house she should know about? Email her at [email protected].
This article originally appeared on NorthJersey.com: Sherrill signs FAIR Act to ban use of AI rent-setting software
