Hi All, I'm looking to buy rental properties in New Jersey. Any advice on a good area to start? Preferably duplex or triplex with a purchase price under 200k? TIA
@Malka Fischman At that price point you will mostly be looking at heavy rehabs and in less desirable areas as far as north jersey is concerned. Can’t speak for the rest of the state. You may be able to find some of those in places like Newark, East Orange, Orange, Irvington, Patterson, and possibly Elizabeth. Again if your looking at north Jersey your gonna have to a lot of work to these houses and they aren’t likely to be in the best neighborhoods of those towns.
@Malka Fischman At that price point you will mostly be looking at heavy rehabs and in less desirable areas as far as north jersey is concerned. Can’t speak for the rest of the state. You may be able to find some of those in places like Newark, East Orange, Orange, Irvington, Patterson, and possibly Elizabeth. Again if your looking at north Jersey your gonna have to a lot of work to these houses and they aren’t likely to be in the best neighborhoods of those towns.
@Malka Fischman Hudson County like Jersey City, Bayonne, West New York. Union county has some decent areas as well at a higher price point like Elizabeth, some of Hillside, Union, and Linden.
For Central Jersey you could be looking in South Amboy, Freehold Boro, Keansburg, Asbury Park, and Neptune. If you go a little farther into Ocean there are some good beach towns too!
Malka, under $200k is a tough one in North Jersey. I agree with Allan with the areas he suggested. However, those are unfortunately distressed areas. I know folks who invest there but you need to be super familiar with all aspects. I focused on Bergen County and positioned them rather high(er) quality for folks with good income. Higher investment, and running expenses but minimal headache with tenants. Mahwah is full with condos and a great place but the town is red hot lately and the purchase prices are out of control. Ramsey is great but high end and pretty expensive. There is athe "Regency Park" section there that could fit your budget. Check out a current listing 109 Regency Park, Ramsey Boro, NJ 07446 for $192k. I looked at them these 1 bedroom condos. They are old but you can pick it up cheap. It is very close to the train station to NYC so could be great for commuters. I suggest get a local realtor involved to coach you on the local specifics.
@Malka Fischman It tough to find single family under 200k in Newark area, market is up, multiple offers on multifamily properties, we see lots of cash transactions, lots of time we put offers without seeing the property. if you are open to occupy the property you might consider getting 203k and build up the equity.
Trenton is probably the best market for those kind of numbers (and the ability to cashflow). With the recent Newark water problems, I would keep your powder dry for a bit. It's not that you can't do things to manage that risk, but if it is a big one, I imagine we'll see some price reductions.
@Trevor Ewen I've been looking at some properties on the edge of Trenton, in Hamilton Twp. What's your opinion of going into that area? And any idea what's the tenant turnover rate?
It's a rougher kind of market, but moving in the right direction. I am a syndication partner in a mixed-use project there (very passive). The tenant profile is wage workers, section 8, fixed-income types. On the edge of town, you actually have many properties with decent green space.
There is a lot to like about growth potential in the market. Beautiful buildings, transportation corridor, commutable to Philadelphia. Finally, the NJ state government gives the town a floor for employment, given that there will be a fixed number of service jobs always available for that case.
If you can be patient, wait for the pending recession and price correction. Everybody loves real estate now for diversification Etc . That makes it the wrong time to buy .
the only way around this is through a distressed off-market sale. It's extremely difficult if not impossible to find those now. You can definitely buy real estate with a projected yield higher than current Bond rates but a bond never has vacancy or needs a new roof. All the best!
I’m a wholesaler in NJ. Focusing on multi families in area like Newark, east orange, Irvington, orange, and close by surrounding areas. Those numbers are doable in these area listed above. The average repairs are usually cosmetic ranging from 30-50k on the low end. Rents are usually $900-1700+ depending on the area. Moving forward I plan to flip or hold some of these properties for myself.
I'm just wondering about these areas, most of the houses surrounding the neighborhood looks run down, not a ethnically diverse neighborhood which in my opinion is recipe for a successful neighborhood.
The people living there don't seem to be employed, and the government is the largest rent payer by way of section 8 am I wrong?
@Joel S. I’m confused on your question. Are you saying areas that are “not” diverse are areas suited for a successful neighborhood or do you mean these area will be more suited for a successful neighborhood? Just trying to get a better understanding so I can answer your question.
Buying in distressed areas are going to be more risky but with risk comes better rewards in some cases if brought right. These area typically vary block to block, so it all depends on the property location you’re interested in as it applies to your own comfort level.
I can say that there many investor flocking to these areas because the price point is suitable and the ROI are great both on a flip and as a rental.
In closing to combat against the risk of crime and possible tenants not paying I’ll say have a proper tenant screening in place and drive the area of the property your trying to invest in both in the day and in the night if you don’t really know the area. It’s no telling when these areas will see a change so buy right and at your own comfort level. Hope this answers your question.