Updated over 6 years ago on . Most recent reply
Starting out with a duplex in NJ
I recently found a duplex in a desirable area of Bergen County. Upstairs units is 1 bdrm/1 bath and the current tenant has been living there for 10+ years. The unit rents $1100 a month, which seems to be under the fair market value. The downstairs unit is a 2 bdrm/1 bath and rents for $1800 a month. The unit is also tenant occupied. I think the duplex is in a good area, easily accessible to trains, grocery stores, restaurants, etc. The seller is currently asking for ~$520k. I would appreciate any input regarding the price, things to consider when looking at a property, etc. My wife and I are currently looking for our first property!
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If you buy it for $520k, you'll be losing money every month. Like a lot of money.
For those rents, I'd pay somewhere between the 1% and 2% rule, which for this house means I'd pay between $145k and $290k.
This is a really, seriously, resoundingly bad deal.
Go to a cheaper market, especially if you want cashflow. I can find 2% deals all day in my market (which is a 2 hour drive from Bergen County) and I'm sure you can find something closer to you that'll cashflow.
I don't know NJ markets really, but feel free to send me a message if you'd consider a PA market. I'd be happy to talk with you.