How's the current Union City, NJ Area market?

[Sebastian Garcia]

Hello everyone!

I'm looking at properties in the Union City area, including Jersey City Heights, West New York, and North Bergen, but focused on Union City mainly for the short commute to the city. I live in NYC and grew up in North Bergen so I'm familiar with the area but not necessarily the real estate market. I'm currently looking at multi-families (likely to house hack) but most modest duplexes are going for 499k+, which is right at the budget I set for myself. I'd go slightly higher for triplexes and whatnot, but those seem rare. 

Do any experts from the area have some advice on how the market is doing? Is it still worth it or should I look elsewhere? I'm going for rental income rather than appreciation. Should I also start looking at "as-is" homes? My dad's also been in construction for 30+ years and can easily work on fixer-uppers, but I'm generally risk-averse (and it's my first property) and don't want to encounter a host of unforeseen issues. But I do want to leverage his expertise.

Any and all advice is appreciated!

Thanks,

Seb

[David Flores]

@Sebastian Garcia, not sure if you are still looking but a little advice/experience for you and others who may end up here. So, I do not own a multi-family home in Union City, but I tried for the longest time to do exactly what you were trying to do. A house hack on a multi-family home. For those of you who do not know what this is, it is when you use your FHA loan to buy a multi-family property. Amazing strategy, truly, but it is nearly impossible to get this done in that section of New Jersey (mainly Hudson county). The main reason for it being nearly impossible is due to something you won't realize until you actually get involved. And believe me I was heavily trying. I went to see homes almost every other day with an amazing realtor who is a decent friend now. We must have put in 8 or 9 offers some above the asking price to be more competitive. But every single one fell through. And here is why.

Hudson county is so hot right now with real estate that you are literally competing against investors from all over the world. I am not kidding about this. If a place was even remotely decent you would have an all cash buyer come in within 10 days max. The turnarounds on these decent places was almost un-real, and probably still is as I do not see this market slowing down. That being said, if a place was put on the market today that seemed good and it hit my numbers I would see it the next day and put in an offer the day after that if it sufficed. That would be 2-3 days on market. But still an all cash buyer would come in a day or two after that to ruin my hopes of a deal. There were other instances where investors would get in a bid war and drive the price up 30k+ past the listing price. 

Now, all that being said. I am trying to tell you that house hacking is hard to do in Union City because 3.5% just isn't competitive enough against these all cash buyers. But, there are deff places available that you can grab. From what I noticed though, these places just don't produce the numbers you need to not just make money, but to even get the loan from the bank. This is because FHA requires that revenue is 25% higher than all costs (including mortgage, taxes, monthly costs, etc.) on a multi-family home. So, you basically need at minimum a 25% margin. Not impossible to find, but hard, and when they are available you can almost guarantee they will be sold within the week.

Bottom line, if you want to get involved in Hudson County (more specifically Union City as this is where i have studied the most) you deff can by either getting other investors involved for a multi-family to be competitive against all the sharks or just simply buy a single family apt/home. This is what I ended up doing. Just got an accepted offer on an 800 sq foot apt in Union City for 250k 10% conventional. I plan on living there for a little bit, maybe 1-2 years. Save up for another down payment during this time. Rent out the property I just bought and continue that process. Homes appreciate like crazy in Union City, so I really just wanted some of my money in Union City because like I said, this market won't slow down until prices match Weehawken and Hoboken. 

I know this is a long response but could be muchhh longer lol. If you have any questions about Union City/hudson county area message me. Would love meeting another investor in the area!