ANY ONE HAVE GOOD RETURNS IN INVESTING IN MULTI-FAMILY IN NJ?

Question

I am looking to invest in NJ buy and hold but the taxes kill the cash flow would wanna know if i should invest outside the state with good cash flow with property price ranging from 100k to 200k i am looking for value.

Josh Sharon · Answer

I have a duplex in Monmouth county. two 3/1 units. one @ 1600 one @ 1400 monthly. if you could pick up a property like that for close to 200k I think that would be a really good deal

Daniel Karbownik · Answer

Mario,

It is true that taxes are high in NJ, but everything else is high to compensate.  Look at what a 3 bed 1 bath home in Monmouth county rents for vs. a 3 bed 1 bath home in some southern state with low taxes like Georgia or Florida or something.  NJ rents are way other than other states, and there is money to be made.  Like any deal, you should analyze the numbers as they are and see if it makes sense.  Some will, some won't.  But to simply write off the entire state of NJ as not being good to invest in just because the taxes are high is foolish and lazy.  I have a few rentals in NJ and I do great.

If you have not done a deal yet, my advice for you would be to invest close to home to start out.  You know the market, you know the neighborhoods, you can drive to the property if there are ever any issues or repairs.  Definitely stay close to start

Amit Patel · Answer

Account Closed

For what you want to buy, it will be REALLY tough in NJ unless you want to go into areas such as Trenton (at least from my experience).  It's not only taxes but water/sewer are really high in NJ. When you have maintenance or repairs, the costs are generally higher as well due to higher labor rates. My suggestion would be to either pool your money with other folks and buy a higher unit multi-fam where the per unit taxes will end up being much lower. For me the sweet spot is a minimum of 4 units but it all depends on the location and price.  If you decide to buy out of state, just keep in mind to make sure you can get good management as you will not be able to go there if there are issues (unless you do PA or other places nearby).

All this being said, if you can find a rehab gem or something similar, you can certainly do well. Due to how competitive NJ is and how low the cap rates are this is what I have to do if I want to earn 9-10% returns in hot areas such as Jersey City. There are properties out there but you will need to buy cash and you will need to go through a ton of properties to find that one gem. PM me if you have any questions.

Account Closed · Answer

Hey thanks @Ralph C. where do i go to find or connect with the commercial brokers?

Account Closed · Answer

Hello,

thank you for your reply, i am not lazy or foolish. I'm not simply writing off NJ the state i just want some information from investors in the state to further help answer some questions. What kind of rentals do you have such as MF? im looking for a buy and hold long term rentals. I live in paterson and wouldn't want to invest here but i am open to other cities in NJ. What would you recommend for finding a good investment rentals such as sites to look for. Also, i have done some of the numbers and im not getting huge cash flows around 300 to 450 monthly on MF maybe im doing the numbers wrong but im very open to know what i can expect.

Joshua Nicholas · Answer

Yields in the entire tri-state area are really low right now. If you want serious yields you need to invest somewhere else.

Stephen Chatto · Answer

I am in the market every day.   So I analyze based on Condition, Repairs, Location, and CASH FLOW.  I do not bank on appreciation at all, but if it comes I will take it.  The rental market here is VERY Strong.   I am getting my units rented quickly.  I have also noticed that the prices have been ticking up.  I also like the fact that the eviction process is pretty fair and streamlined should you need to use it.

If you have any questions on the Trenton Market feel free to PM me or give me a buzz!

Thanks

Yonah Sturmwind · Answer

Stephen Chatto, how do you analyze a market like Trenton? Are you assuming just straight cashflow with 0 appreciation in rents? I am not very familiar with the market and I believe its on where rent growth is tough to achieve.

Stephen Chatto · Answer

I think that trenton is a great market for cash flow.   Definately a market to consider.   I have buy and hold in trenton myself.  Let me know if you have any questions.

Ralph C. · Answer

Loopnet is a good site to check the commercial players in those areas you are interested in....

Then you can go to their iindividual sites, check out those agents that have the listings and contact them.

ANY ONE HAVE GOOD RETURNS IN INVESTING IN MULTI-FAMILY IN NJ?

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