Analyzing rental properties in northern NJ

[Ruchik Gandhi]

Hello everyone,

I am new to the real estate journey with a focus on the northern NJ market. Reaching out to other investors: one thing I have noticed is that it is impossible to achieve positive rental cashflow at 80% LTV financing in northern NJ mainly due to high taxes and high property prices. As such, it seems the minimums required in the property prior to purchasing recommended by experts almost never meet (1% rule, positive cashflow of minimum $100, CoC return of 12% or higher, etc). If going by these rules, it seems like there are no good properties to invest in northern NJ. Am I missing something? I assume vacancy rate to be 10%, is that too high for northern NJ? Does investing in norther NJ mean you have to rely on appreciation to recover negative cashflow?

I appreciate your help with this. Thank you in advance.