Newbie wants to get start around Philly/KOP/NJ

27 Replies

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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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. 

@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.

@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. 

@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+

@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.

@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. 

@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.

@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.

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:

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

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

@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!