First Time Buyer Help!

[Ryan Champin]

Hey Guys,

Im in need of some advice. Im a first time buyer in a hot, hot market. Upper NJ to be exact. I have recently put in a bid for a 4-plex(a 3 unit with a detached huge 4th unit). Each unit has a laundry room and extra small "day rooms". There is even two finished rooms in the attic that isnt a legal 5th unit, but still could be of value. This property is located in Kearny. Its not a booming town, but its inbetween some great areas. The asking price is 550k for this place which is higher than 95% of all the other properties in the area. I would be using an FHA loan on this so my level of equity in the property, if I got it, would be next to nothing. It cash flows very nicely though. I put in an offer at 515 in hopes that I could do a value add to increase my equity in case of a market turn. But my realtor is telling me that theres no way the seller will take less than asking in such a hot market. Is it safe to purchase a property with such low equity? I can definitely improve the value of the property be renovating kitchens etc. but not enough to cash out refi, which is obviously the goal.

My mind is racing on this, any help would be greatly appreciated!