Newbie wants to get start around Philly/KOP/NJ

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Newbie wants to get start around Philly/KOP/NJ

Tina Gao
Member since 2019 · 5 posts · 1 vote

Hi everyone, I am a newbie for BP and I want to start investing on multi-family properties since desk job is so boring and does not pay well. I live around NYC area and have been looking for NJ property around NYC (union city, jersey city, etc.) for couple months but the price is so high and tax literally kills the deal. My goal is positive cash flows collected from rent (with decent appreciation of course would be ideal) but I can barely find a deal to break even now around here. 

Considering future I may move to PA nearby places I am considering to start looking at properties in PA or around KOP. Since a newbie I am not looking for super crappy houses to fix up, ideally in good condition just need a bit cosmetics. Any suggestions where would be potential good areas to look into would be highly appreciated. Any area with decent cash flow, or can break even now but with potential of appreciation a decent amount of new constructions going, town re-development plan etc. not necessary to be duplex. open to townhouse, single family, 3-units etc.

Thank you!

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David Vitarelli
Inspector · Voorhees, NJ · Member since 2015 · 104 posts · 47 votes
7y

@Stephen Kappre there are many areas that are often overlooked because of the general misconception that “taxes are too high in NJ”. I personally manage a portfolio of 25 properties in Gloucester City, for one of my clients. The average purchase price of a 3/1 in Gloucester City is $60k-$70k. Average property tax on a property like this is about $3k annually. This client has zero vacancies, zero evictions and collects an average rent of $1,250 per month. Depending on how the property is financed, the returns can be very attractive. Additionally, there are many other towns in this area that yield similar returns. DM me if you want to discuss further. 

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  • Ethel Weaver
    Investor · Harrisburg, PA · Member since 2015 · 63 posts · 6 votes
    7y

    Welcome!  There are a lot of useful tools and knowledge 

    0Reply
  • David Michael
    Developer · Closter, NJ · Member since 2016 · 392 posts · 109 votes
    7y

    Welcome @Tina Gao, My opinion is that if your going to be moving to PA and the prices here in Bergen County and surrounding areas are high. It best to start in PA. I have a friend that lives in Stroudsburg and the number there are good. 

    0Reply
  • Tina Gao
    OP
    Member since 2019 · 5 posts · 1 vote
    7y

    Thank you @David Michael!

    0Reply
  • Tina Gao
    OP
    Member since 2019 · 5 posts · 1 vote
    7y

    thanks @Ethel Weaver!!

    0Reply
  • David Smith
    Rental Property Investor · NJ/PA · Member since 2016 · 555 posts · 149 votes
    7y

    Deals in NJ is not too bad, with High appreciation. Union city is a good place. 

    Surely , PA cap rate is better but less potentials than NJ NY. 

    0Reply
  • David Vitarelli
    Inspector · Voorhees, NJ · Member since 2015 · 104 posts · 47 votes
    7y

    @Tina Gao there are many areas in south Jersey that are yielding very attractive returns, with relatively low risk. DM if you are interested in discussing further.

    0Reply
  • Stephen Kappre
    Real Estate Agent · South Jersey · Member since 2017 · 252 posts · 143 votes
    7y

    @David Vitarelli I'd be interested in hearing what areas you are talking about. 

    0Reply
  • David Vitarelli
    Inspector · Voorhees, NJ · Member since 2015 · 104 posts · 47 votes
    7y

    @Stephen Kappre there are many areas that are often overlooked because of the general misconception that “taxes are too high in NJ”. I personally manage a portfolio of 25 properties in Gloucester City, for one of my clients. The average purchase price of a 3/1 in Gloucester City is $60k-$70k. Average property tax on a property like this is about $3k annually. This client has zero vacancies, zero evictions and collects an average rent of $1,250 per month. Depending on how the property is financed, the returns can be very attractive. Additionally, there are many other towns in this area that yield similar returns. DM me if you want to discuss further. 

    2Reply
  • Stephen Kappre
    Real Estate Agent · South Jersey · Member since 2017 · 252 posts · 143 votes
    7y

    @David Vitarelli I don't disagree regarding the taxes in Jersey. Lower tax areas may cash flow more and appreciate less, but are easier to get into with lower prices. Higher tax areas may appreciate more and pull much higher rental figures, better schools, etc but cost more upfront. Maybe for some vacancy is the scary part, since other state's taxes overall are so much lower so vacancy doesn't hit as hard if you have a place empty for a bit when your taxes are $90/mth versus $500+

    0Reply
  • David King
    New to Real Estate · San Diego, CA · Member since 2015 · 13 posts · 1 vote
    7y
    Good evening Everyone! I'd like to link up with you @Stephen Kappre and @ David Vitarelli? Please forgive my newbie-ness but how do I DM you guys?
    0Reply
  • Luke Bonus
    Rental Property Investor · South Jersey · Member since 2019 · 9 posts · 4 votes
    7y

    @David Vitarelli I just noticed Gloucester City appears to have some real potential. I was driving around there yesterday trying to get a feel for the area. Seems like an area that makes a lot of sense when you break down the numbers.

    0Reply
  • David Vitarelli
    Inspector · Voorhees, NJ · Member since 2015 · 104 posts · 47 votes
    7y

    @David King

    @David King drop me a line anytime. My email address is in my profile signature, I’d be glad to chat with you.

    @Luke Bonus it does indeed have potential. In fact, a deal came across my desk today that was very appealing. It’s a $55k 3/1 assignment deal. It needs about $5k to be rent ready, then it will rent for $1,350. There are lots of deals like these right now. It’s a good time to be in Gloucester City. Let me know if I can be of any help. 

    2Reply
  • Luke Bonus
    Rental Property Investor · South Jersey · Member since 2019 · 9 posts · 4 votes
    7y

    @David Vitarelli that would be amazing! I will definitely be in touch. I am really trying to dive into this process head first. There’s a lot to take in.

    1Reply
  • Taylor Whylings
    Rental Property Investor · Audubon, NJ · Member since 2018 · 9 posts · 5 votes
    7y

    @Tina Gao. Look into Gloucester city... can get into something fairly cheap and I’ve heard things about it turning for the better if you’re looking for appreciation.

    0Reply
  • Tina Gao
    OP
    Member since 2019 · 5 posts · 1 vote
    7y

    @David Smith Thanks! Ya I still have my eyes on Union City I just dont wanna involve into the bidding war right now.

    0Reply
  • David Smith
    Rental Property Investor · NJ/PA · Member since 2016 · 555 posts · 149 votes
    7y
    Bidding war ?

    i saw many properties in union city stay on market forever. No one buys. And the price is right. 


    Originally posted by @Tina Gao:

    @David Smith Thanks! Ya I still have my eyes on Union City I just dont wanna involve into the bidding war right now.

    0Reply
  • Tina Gao
    OP
    Member since 2019 · 5 posts · 1 vote
    7y

    Thanks @David Vitarelli  @Taylor Whylings. Any specific things going on with Gloucester City? like city redevelopment plan? new constructions going on? new shops or restaurants? It seems like the number of population is kind of stable but going down a bit year by year in the past ten years. 

    0Reply
  • Kyle Z.
    King Of Prussia, PA · Member since 2017 · 23 posts · 2 votes
    7y

    @Tina Gao

    Hey Tina, I live in KOP and grew up here. If you have any questions specific to the area feel free to DM me.

    0Reply
  • Ronald Cooperman
    Member since 2019 · 117 posts · 45 votes
    7y

    We invest in Gloucester city. I met with Mayor a week ago.  He is VERY anti rentals. The city nickels and dimes you to death on CO’s.  They check warrants on renters. As for new development- 150 higher end townhouses were just approved. 

    An investor I know just went down with 100 properties talking 8 banks with him.  My bank cancelled a loan after appraisals on 8 properties, and I have a relationship with the bank president. 

    All in all the numbers are good, tenants are blue collar pay their bills do not bother us. Our average tenant is a family and stay an ace of 3-5 years. 

    We are not see any appreciation yet, hopefully in time. Cash flow is fine with 75% financing. 

    In the end we are looking to grow our portfolio there

    0Reply
  • Andrew T.
    New York City, NY · Member since 2017 · 24 posts · 6 votes
    7y

    @Tina Gao

    I live in North Jersey and work in NYC, but grew up in Philly. Also looking for a property over there, let's connect!

    0Reply
  • Eli Schwartz
    Rental Property Investor · NY NJ · Member since 2019 · 65 posts · 36 votes
    7y

    @David Vitarelli the numbers looks really good, just 1 concern isn't Gloucester City in the flood zone?

    0Reply
  • Jonathan DempseyBusiness Member
    Rental Property Investor · Pocono Pines, PA · Member since 2018 · 153 posts · 117 votes
    7y

    @Andrew T. @Tina Gao

    I work in Jersey City but decided to start my Portfolio in Philadelphia. The market in some neighborhoods has been appreciating well and the numbers work as Philly has relatively low taxes to NJ.

    It also feels better purchasing a home for $200K-$300K instead of a shoebox. Feel free to reach out to me if you’d like to chat!

    0Reply
  • Joseph ScoreseBusiness Member
    Banker · Philadelphia · Member since 2009 · 2k+ posts · 631 votes
    7y
    @Tina Gao How are you. Would suggest joining Diversified Investors Group which is a REIA in that area where you can network,, etc. Regards Joe Scorese
    1Reply
  • Paul Jagielski
    Real Estate Agent · Oreland, PA · Member since 2018 · 4 posts · 1 vote
    7y

    @Tina Gao  Philadelphia itself has some great areas that are growing right now. (Strawberry Mansion, Cobbs Creek) where the area is a little rough now but developers are in there and really turning the areas (like they did with Fishtown and Brewerytown).  KOP is a little harder of a multi-family rental area bc it is established already and growing. So it will be more expensive out there IF you can find anything. I am a real estate agent in the city of Philadelphia and the surrounding suburbs. If you need any further help feel free to reach out.  

    0Reply
  • Louis Haase
    Member since 2018 · 7 posts · 1 vote
    7y

    Welcome @Tina Gao! I have not begun investing myself but I have seen some people get great returns in the Port Richmond and Cobbs Creek (as mentioned by @Paul Jagielski above) areas of Philadelphia. The investors I have been in contact with found properties that required little rehab work but yielded great ROI since prices in these areas have been steadily increasing and seem to be hot spots for investors. I recommend neighborhoods like these in the city due to the continuing influx into the city and rapid gentrification seen in many neighborhoods like these. Feel free to reach out if you have any more questions.

    0Reply
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