Renting Out a Property in Northern New Jersey

Most owners who call me about renting have not actually decided to rent yet. They are weighing it against selling, and what they want is someone to lay out both honestly rather than talk them into whichever one pays more.

So that is where this starts.

Should you rent it out or sell it?

There is no general answer. There is a specific one for your property, and it usually turns on four things:

What the property would rent for against what it costs to hold. Mortgage, taxes, insurance, maintenance and the months it sits empty between tenants.
What it would sell for today, and what you would do with the proceeds. Money released is money you can use elsewhere, including on another property.
Your tax position. Renting and selling are treated very differently, and the timing of a sale can matter. That is a conversation for your accountant, and it is worth having before you decide, not after.
Whether you want to be a landlord. Some people find it straightforward. Others find that one difficult tenancy changes their mind permanently.

I will put the rental side and the sale side in front of you with real numbers for your property, and I will tell you which way I lean and why. You decide.

What renting it out actually involves

Pricing it. Same method as a sale, different data. I look at what comparable properties have actually rented for recently, not at asking prices, and adjust for condition, layout and location.
Getting it ready. Rentals are judged quickly and on different things than a sale. Clean, functional and well presented matters more than renovated.
Municipal requirements. Many New Jersey towns require landlord registration and a certificate of occupancy inspection before a new tenant moves in. Requirements differ town by town and I will tell you what yours involves.
Marketing it. The listing goes to NJMLS and GSMLS and to the portals renters actually use, which is how you reach tenants represented by other agents rather than only the ones who find you.
Showings and enquiries. This is the time-consuming part and it is the part I take off you.
Applications and screening. Applications are collected and verified through a consistent process applied to every applicant, within what the law permits.
The lease. Terms, deposit, dates and conditions. A lease is a legal document and an attorney should review it.
Move-in. Condition documented, deposit handled correctly, keys handed over.

What I do, and what I do not do

I find and place tenants. Pricing, preparation, marketing, showings, applications, and getting to a signed lease and a move-in.

I am not a property manager. I do not collect rent, handle maintenance calls or manage the tenancy after move-in. If you want that, I will tell you honestly that you need a management company and I can point you toward ones I know of.

I am not an attorney. Leases, evictions, deposit disputes and anything else legal go to a New Jersey real estate attorney. I will tell you when you need one, which is earlier than most owners expect.

What it costs

Compensation for a rental is negotiable and is not set by law, by any association, or by any standard rate. We agree it in writing before the property goes on the market, so there is nothing to work out later.

There are also municipal costs to expect, such as registration and inspection fees, which vary by town.

If you own more than one property

Owners with several rentals usually have a different problem from owners with one. The question stops being whether to rent this property and becomes which properties to keep, which to sell, and whether the next one is worth buying.

I can work across all of that: renting the ones you keep, listing the ones you sell, and helping you look at what you would buy next. What a property will earn or be worth later is not something I will predict for you. What I will do is get you accurate current numbers on each one so the decisions are made on facts.

What New Jersey requires of a landlord

More than most owners realise, and it varies by municipality. In broad terms you should expect requirements around:

Landlord registration with the municipality or the state, depending on the property.
A certificate of occupancy or continued occupancy inspection before a new tenant moves in, in many towns.
Security deposits, which are limited by statute and must be held and accounted for in a specific way.
Habitability and safety, including smoke and carbon monoxide certification.
Fair housing. New Jersey protects more categories than federal law does, including lawful source of income, which means a housing voucher cannot be a reason to refuse an applicant.

I will tell you what applies in your town. The legal detail belongs with your attorney, and I will say so rather than guess.

Who I am

I am Reshmee Jugmohun, a licensed New Jersey real estate agent with Prominent Properties Sotheby's International Realty in Saddle River. My New Jersey Real Estate License number is 1909890. I am a REALTOR®, a member of NJMLS and GSMLS, and a licensed New Jersey Notary Public.

I work across Bergen, Passaic, Essex, Morris, Hudson and Union counties, 171 municipalities in total.

Where to start

Not sure whether to rent or sell. Tell me about the property and I will put both sides in front of you with real numbers. Get in touch.
Want the sale figure first. Start with a valuation to get a range, then we can compare it against what it would rent for. Get a property valuation, or read how I price a house for sale.
Thinking about adding another property. Two-to-four family homes are financed as residential rather than commercial, which is why they are the usual place people start. How buying works, or search what is available.
Ready to rent it out. Tell me the address and when it is available and I will tell you what I think it rents for and what your town requires. Get in touch.

Common questions from owners

How much rent can I charge?

The way to answer it is the same as pricing a sale: look at what comparable properties nearby have actually rented for recently, then adjust for condition, layout, parking and how quickly you need it filled. Asking prices tell you what other owners hope for. Closed rentals tell you what tenants agreed to pay.

Do I have to register my rental property in New Jersey?

In most cases yes, and where you register depends on the property and the municipality. Many towns also require a certificate of occupancy or continued occupancy inspection before each new tenancy. Requirements differ town by town, so it has to be checked for your specific address, and I will tell you what yours involves.

How much can I ask for a security deposit?

New Jersey limits security deposits by statute and also sets rules for how the money must be held and how the tenant must be told where it is. Getting this wrong is one of the more common and more expensive landlord mistakes, so confirm the current limit and the handling rules with your attorney before you collect anything.

Can I refuse a tenant who has a housing voucher?

No. New Jersey protects lawful source of income, which includes housing vouchers and other rental assistance, so a voucher cannot be a reason to refuse an applicant or to advertise that you will not consider one. This is broader than federal fair housing law and it applies to small landlords too.

Can I refuse pets?

A no-pets policy is generally a business decision you are allowed to make. Assistance animals are a separate matter and are not treated as pets under fair housing law, so a blanket refusal that sweeps them in creates a problem. If you plan to restrict pets, have your attorney check how the policy is worded.

How long does it usually take to rent a property?

It depends far more on price and condition than on the calendar, and it moves with how much comparable inventory is available in your town at that moment. A property priced against real closed rentals and presented well tends to move; one priced against hope tends to sit and then get reduced anyway.

Do you manage the property once the tenant moves in?

No. I find and place the tenant and take it through to a signed lease and move-in. I do not collect rent, arrange repairs or handle the tenancy afterwards. If you want that handled for you, what you need is a property management company, and I would rather say so than pretend otherwise.

What happens if my tenant stops paying?

Removing a tenant in New Jersey is a court process with specific requirements, and it is not something a landlord should attempt informally. This is squarely a matter for a New Jersey attorney, and how the lease was written will matter a great deal when you get there.

What is the difference between renting it out myself and using an agent?

Doing it yourself saves the compensation and costs you time and reach. You handle the pricing, the enquiries, the showings, the applications and the paperwork, and you are visible only to tenants who find you directly rather than to those working with an agent. Some owners are well suited to it. If you are weighing it up, I am happy to tell you honestly what it would involve for your property.

Can I rent it out now and sell it later?

Yes, and plenty of owners do. Two things to think through first: a tenancy in place affects who will buy it and when you can sell, and the tax treatment of a property that has been rented differs from one you have lived in. Your accountant should look at the second point before you decide, not after.