New Jersey HOA Assessment Limits

Section 1: Overview — How assessment authority and limits work in New Jersey

New Jersey does not cap assessment increases by statute and requires no budget-ratification vote. The declaration and bylaws set the limits on what a board can levy. When assessments go unpaid, the association records a lien that carries a six-month limited priority over a prior first mortgage.¹ Condominiums operate under the New Jersey Condominium Act (N.J. Stat. § 46:8B-1 et seq., P.L. 1969, c.257). Planned developments and other common-interest communities operate under the Planned Real Estate Development Full Disclosure Act (PREDFDA, N.J. Stat. § 45:22A-21 et seq.), which the New Jersey Department of Community Affairs administers.^2,3 Regular assessment increases run through the board's budget process under the bylaws. The statute sets no percentage ceiling and requires no owner ratification or veto step.⁴ The association's main collection tool is the lien under N.J. Stat. § 46:8B-21. That lien is generally subordinate to a first mortgage, but it carries limited priority for up to six months of customary assessments ahead of a prior recorded first mortgage.¹ On the national spectrum, New Jersey belongs to the declaration-driven states, distinct from statutory-cap states like California and from the owner-ratification states in the UCIOA family. What sets New Jersey apart within that group is its six-month limited-priority lien.⁵ The sections below set out the framework, the procedures in practice, and recent legislative and judicial activity.

Section 2: The assessment framework

2A. Authority to levy and allocate assessments

For condominiums, the New Jersey Condominium Act vests administration and management in the association. The Act charges the association with carrying out all activities of common interest to unit owners.⁶ Acting through its officers or governing board, the association assesses and collects funds for common expenses. It may levy and collect assessments for common expenses or other purposes, along with interest, late fees, and reasonable attorneys' fees when the master deed or bylaws authorize them.^7,4 Common expenses are allocated according to each owner's percentage interest in the common elements as the master deed, declaration, or governing documents specify, or in proportions those documents otherwise establish.⁸ A unit owner who accepts title is conclusively presumed to have agreed to pay a proportionate share of common expenses. Liability is limited to amounts the association duly assesses under the Act, the master deed, and the bylaws.⁸ For planned developments, the declaration and bylaws supply the assessment authority, with PREDFDA providing the surrounding framework. The executive board acts on behalf of the association within the limits the declaration and bylaws set.³ In both types of community, the board sets the assessment through the budget process the bylaws govern. The declaration, master deed, or bylaws control the allocation formula — not a statutory ratio.⁸

2B. Limits on regular assessment increases

New Jersey imposes no statutory percentage cap on regular assessment increases and provides no owner-ratification step. The bylaws govern the budget adoption. Any operative limit comes from the declaration and bylaws themselves, not from the Condominium Act or PREDFDA.⁴ Where the governing documents impose a member-approval threshold or a ceiling on annual increases, that threshold controls. Without such a provision, the board sets the budget and the resulting assessment.⁹ The bylaws — which the Condominium Act requires to be recorded with the master deed — govern the form of administration, the board's powers and duties, and the method for adopting and enforcing rules, fines, and late fees.⁹ The Radburn amendments (P.L. 2017, c.106) reformed governance, elections, and bylaw-amendment procedures for community associations under PREDFDA. Their connection to budget adoption is indirect: they establish how boards are elected and how board meetings are conducted.¹⁰ An assessment increase adopted without following the bylaws and applicable meeting procedures is open to challenge. A board that fails to follow its own documents risks having the increase — or its collection — contested.⁹

2C. Special assessments, the lien, and the six-month priority

The declaration and bylaws authorize and limit special assessments. The statutes set no percentage cap, and any member-approval threshold is the one the governing documents establish.⁴ When assessments go unpaid, the association may record a lien under N.J. Stat. § 46:8B-21. That lien is generally subordinate to a property-tax lien, any mortgage on the unit, and any lien recorded earlier.¹ The statute grants a limited priority over a prior recorded first mortgage for "customary condominium assessments," in an amount up to the aggregate customary assessment for the six months before the lien is recorded, "cumulatively renewed on an annual basis as necessary."¹ The priority comes with conditions. The association must record the lien before it receives a foreclosure summons and complaint or before a lis pendens is filed — the foreclosure-timing rule. Where the association files more than one lien, total priority cannot exceed the six-month figure — the multiple-lien cap. Priority over the same mortgage expires on the first day of the 60th month after recording, subject to cumulative annual renewal — the 60-month limit.¹ The association must also notify any first-mortgage holder in writing when it records a lien that may receive priority — the notice-to-mortgagee requirement.¹ On any voluntary conveyance, the grantor and grantee are jointly and severally liable for unpaid assessments accrued through the date of conveyance under § 46:8B-21(c).¹¹ An association can secure up to six months of customary assessments ahead of a foreclosing first mortgagee if it records before the lender's foreclosure summons or lis pendens, notifies the mortgagee, and observes the multiple-lien and 60-month limits.¹

Section 3: Assessment limits and procedures in practice

A. Regular assessment increase procedure

The board adopts the annual budget under the bylaws, and the resulting assessment takes effect as the bylaws provide. This framework applies to both condominiums and planned developments — no statutory percentage cap, no ratification step.^4,9 For condominiums, the Condominium Act requires that board meetings where binding votes occur be open to unit owners. That requirement governs how the association notices and conducts a budget vote.⁹

B. Special assessment procedure

The declaration and bylaws govern authority to impose a special assessment, including any member-approval threshold. There is no statutory percentage cap. This applies to both condominiums and planned developments.⁴ For planned developments, reserve underfunding is a common trigger for a special assessment. The Structural Integrity and Reserve Funding Law (P.L. 2023, c.214), as amended in 2025, ties reserve adequacy to a 30-year funding plan and requires associations that fund below the recommended level to disclose any anticipated special assessment or loan.^12,13

C. Caps, ceilings, and override mechanisms

New Jersey supplies no statutory percentage cap on regular or special assessments. It provides no owner-ratification or owner-veto mechanism. The only operative limit comes from the declaration and bylaws. This applies to both condominiums and planned developments.⁴

D. Notice, documentation, and disclosure tied to assessments

Assessment notices and meeting notices follow the bylaws. For condominiums, the open-meeting requirement of the Condominium Act also applies.⁹ The six-month limited-priority lien and the notice-to-mortgagee requirement are both statutory. A condominium lien arises under § 46:8B-21; a planned-development lien arises under § 45:22A-44.1.^1,14 On resale, a unit owner or purchaser may request a certificate from the association stating the amount of unpaid assessments, and a relying purchaser may depend on that certificate, under § 46:8B-21(d). The lien and certificate provisions apply to both condominiums (§ 46:8B-21) and planned developments (§ 45:22A-44.1).^11,14

Section 4: Recent legislative and judicial activity

A. Recent bills

New Jersey's most significant recent activity in assessment law covers two areas: reserve-fund requirements that shape when boards must levy special assessments, and the 2019 lien extension that gave planned-development associations the same limited-priority lien that condominium associations hold.

B. Recent appellate rulings

New Jersey appellate courts have reinforced the statutory principles for assessment collection, particularly the fee-shifting provisions of the Condominium Act.

C. Active legislative debates

Legislative attention in the 2024–2025 sessions focused on refining the Structural Integrity and Reserve Funding Law, not on the lien priority itself. Proposals targeted reserve-funding timeframes and disclosure requirements — the rules that shape when associations turn to special assessments.¹³

Section 5: National positioning

On the assessment-limit spectrum, New Jersey belongs to the declaration-driven group. The first group is the statutory-cap states, led by California, where Cal. Civ. Code § 5605(b) bars the board from imposing a regular assessment more than 20 percent above the prior year's assessment, or special assessments exceeding 5 percent of budgeted gross expenses, without majority approval of a quorum of members.⁵ The second group is the owner-ratification states in the UCIOA family — Alaska, Colorado, Connecticut, Delaware, Maine, Minnesota, Nebraska, Vermont, and Washington — which control increases through an owner veto on the board-adopted budget. The third group, which includes New Jersey, sets the limit by declaration and bylaws, with the statute supplying no cap. New Jersey's six-month limited-priority lien over a prior first mortgage distinguishes it within that group.¹ For a multi-state operator entering New Jersey, the limit comes from the declaration and bylaws — not the statute. The association holds a six-month limited-priority lien if it meets the statutory conditions.¹ New Jersey extended that limited-priority lien to planned developments in 2019.¹⁵ Federal frameworks also apply to New Jersey assessment practice, including the Fair Debt Collection Practices Act, the Servicemembers Civil Relief Act, and the bankruptcy treatment of assessments.

1. New Jersey Department of Community Affairs, N.J. Stat. § 46:8B-21, Liens in favor of association; priority ↩
2. New Jersey Department of Community Affairs, N.J. Stat. § 46:8B-1 et seq. (P.L. 1969, c.257), New Jersey Condominium Act ↩
3. New Jersey Department of Community Affairs, N.J. Stat. § 45:22A-21 et seq., Planned Real Estate Development Full Disclosure Act (PREDFDA) ↩
4. New Jersey Department of Community Affairs, N.J. Stat. § 46:8B-15, Powers of association ↩
5. California Legislative Information, Cal. Civ. Code § 5605, Regular and special assessment limitations ↩
6. New Jersey Department of Community Affairs, N.J. Stat. § 46:8B-12, The association ↩
7. New Jersey Department of Community Affairs, N.J. Stat. § 46:8B-14, Responsibilities of association ↩
8. New Jersey Department of Community Affairs, N.J. Stat. § 46:8B-17, Common expenses; proportionate share ↩
9. New Jersey Department of Community Affairs, N.J. Stat. § 46:8B-13, Bylaws ↩
10. New Jersey Legislature, P.L. 2017, c.106, Act concerning community associations (Radburn amendments) ↩
11. New Jersey Department of Community Affairs, N.J. Stat. § 46:8B-21(c)–(d), Joint and several liability; certificate of unpaid assessments ↩
12. New Jersey Legislature, P.L. 2023, c.214 (S2760), Structural Integrity and Reserve Funding Law ↩
13. New Jersey Legislature, P.L. 2025, c.132 (S3992), Act concerning capital reserve funding requirements for certain planned real estate developments ↩
14. New Jersey Department of Community Affairs, N.J. Stat. § 45:22A-44.1, Lien on each unit for certain unpaid assessments ↩
15. New Jersey Legislature, A5002, P.L. 2019, c.68, Act concerning liens filed for unpaid assessments in certain common interest communities ↩
16. New Jersey Department of Community Affairs, N.J. Stat. § 46:8B-21(g), Provisions not applicable to cooperatives ↩
17. New Jersey Courts, George Haffert v. Bell Tower Condo. Ass'n, No. A-3853-23 (App. Div. Mar. 11, 2026) (unpublished) ↩