New Young Investor, what cities should I be looking at? Strategy?

[David Czech]

So I'm 26 and looking to buy my first investment property. My parents recently purchased a duplex of their own and I've been looking for a multifamily house primarily in towns in Central NJ (Union County). I am looking for something with generally little maintenance or work required that would provide $300-500 positive cash flow a month. Currently, I am looking at using the first time homebuyers benefit that would warrant a low fixed interest rate with around 10% down. 
 

However, I've lost out on three deals already. From what I can gather, I was beat out by investors that paid asking price or higher, even when the property wasn't even worth that much based on certain factors (year built, additions, presence of Central Air or not, etc.) .

So I guess my first question here is what am I doing wrong? When looking at such close proximity to NY, does it make sense to only offer asking price? I haven't been having any luck otherwise. Also, if there are some areas to look at or other strategies I should consider, I would love that information. Thanks!