Househacking in East Rutherford/Carlstadt Advice

[Chow Ahmed]

Hi All,

I am a first time poster and first time buyer. I have been listening to BP podcasts, Googling acronyms, reading forums, and searching Zillow/Redfin/Realtor/etc for about a month now. I am searching the Northern Jersey area - so far I've specifically been looking from West New York down to south Weehawken/Union City, then out west from Carlstadt down to northern Lyndhurst.

My criteria is as follows -

1. <$600k - min 2 units at least 1 bed/1 bath
2. Turnkey or close to it
3. Low crime
4. Commute to port authority 1 hour MAX
5. Able to walk everywhere - I will not have a car. Open to biking around.
6. Some semblance of a downtown area within a couple miles
7. We are a couple - enjoy nature, going out to eat/drink maybe once or twice a month.

As of now, I plan to do a 30 year FHA owner occupied - after 1 year I will move out so all units will be rented out and I should be cashflow positive around $500 or so. For that one year, I am willing to pay up to $1k (PMI, tax, mortgage, repairs, etc.) and the tenant rent should be able to cover the rest. So if the average rent is between $1.6k and 2.2k, I can probably get away with between total cost per month @$2.6k and $3.2k.

With all this being said - my favorite town is East Rutherford which seems to hit all of my criteria (+low property taxes) based on my initial internet research. I plan to do a drive-by this weekend and walk around to get a better feel. However, I wanted to ask you, BP NJ community, can you 1) let me know if my thought process and criteria's sound reasonable - I am hoping to get my first deal ASAP, but not before my due diligence and 2) can you offer what other towns may fall within my criteria?

Thanks a ton!!!

[Mark F.]

Hi Chow,

You're head is in the right space. Those areas are very competitive due to the proximity to NYC. Most 2/1 duplexes are between 480k and 600k. Low end is usually outdated and may need work, high end is usually basic reno'ed. Some are going for over 600k. So I think under 600k is reasonable. Personally, drop the "I want to pay 1k" thing. Make the numbers work and it will all work out. You said you want to cash flow $500 after you leave, I think that is a solid goal to shoot for. 

All depends on your goals and situation for CF. A lot of people on BP want lots of cash flow and hey dont we all, but in Northern NJ it is so difficult to get that CF (unless you BRRRR). My criteria is $1k CF after PITI (yes I'm aware i'll have cap ex, repairs, maint, utilies but my situation is different). So I don't worry about what I'm paying while I'm living in the house hack, I care about the numbers after I leave.

As far as other townships, all of the smaller ones around that area are good minus Paterson. They're all solid IMO, Wallington, Rutherford, Hasb. Heights, etc. Rutherford and E.R. are very competitive fy, Good luck!