All Forum Posts by: Francesco G.

If it's your primary residence and it's 4 units I would keep it in your name and get a $1m+ umbrella policy which should only run you a few hundred dollars per year. On top of that you can get an FHA 203k 30 year fixed rehab loan to help with renovations. If you weren't living there and it was 5+ units you could consider an LLC but you'd only be limiting yourself in this instance. The property being your primary residence allows for so many advantageous financing options.

Originally posted by @Mike Adams:

We're open to 200k - 1.5m per property if the numbers work.  Appreciation is nice, but positive income is what's necessary.  I will expand to those areas as well; just need a good NJ broker.  

With that budget and your location being Lodi I would take a look at the surrounding towns in your area, Garfield especially. I have a close friend with two fourplexes in garfield. its a great rental town. Find an agent for MLS listings, but also drive for dollars and identify properties you like. Once you identify them, research the tax records and find out who owns it, how much they paid. Contact them directly and see who is open to selling.

I had a similar situation on my first fourplex. Tenant was in a rent controlled unit for 30 years. I renovated an empty unit and offered it to her at a discounted rate but almost double her current rent. She was happy to pay more for a renovated unit and it let me renovate hers and rent it for top dollar. Each year after I raised her the allowable amount until she was at market rates. You need to first check if there are rent control laws in your area and then I would discuss their willingness to leave or pay more. Be open and honest about your intentions

Suck it up and get a conventional loan and put 20-25% down. If the market is too expensive then wait for prices to drop and in the meantime put away money for the down payment. If you buy right and at a discount and add some value you can cash out refi in a few years and roll that into another property. In my opinion and experience a hard money loan isn't a good idea for a buy and hold. It could work temporarily but. It in these market conditions with low cap rates you're asking for trouble especially factoring in a learning curve on your first deal. I actually think it's to your benefit to wait and save for the down payment because hopefully once you've saved it up, the market will have cooled off and will be more affordable. I wouldn't touch any market deals at the current cap rates. The properties just aren't cash flowing enough

your attorney should be able to tell you if you can get the earnest money back.  Depends how he wrote the contract

If you're looking for two family investment properties you should be able to still find deals. drive around, craigslist, mls, network with brokers/agents, and join a REIA. deals will come.

Hi,

I don't think you can actually ask them to leave.  In NJ, just because a lease term is up you can't just ask the tenant to leave because you don't want to renew.  This is regardless of whether or not a new owner is buying the house.  You inherit those tenants.  The only difference is if you are going to use the units as your residence, but you'd have to prove this.  If they have leases in place and they aren't up, you'd have to wait until the term is up.  Send them a notice to quit and let them know if the non-renewal.  In my opinion this particular house isn't a great fit if you're looking to move in immediately since it could take some time to either wait for them to leave voluntarily or worst case evict them.  I wouldn't pay a penny to have them leave.  Take ownership and do everything by the book and you can get them out if you really do need it for your primary residence.  

i'd go with natural gas if money is not a factor.  people prefer it and if you're already have the plumber there i'd do it.  I find that tenants appreciate it more.  i'd be less worried about the open flame.  i feel like electric is used in older homes that previously had oil heat and no natural gas run within the home.

Originally posted by @Account Closed:

Hi everyone, when I eventually get ready to invest in real estate I will not be able to start out where I live here in westchester county, New York or anywhere somewhat close (over an hour) to here because of the really high prices. I don't know wether I should go further upstate or even in New Jersey or Connecticut which would be a long drive, or invest out of state so I can get better cash flow for a lower initial purchase price, then eventually I can work my way to invest here(if that would even be worth it). Does anybody from this area or any area in general that is very expensive have any advice for somebody just starting out like me. Please help me out on what to do. Overall, would it even be worth it to invest here even when I have more money down the line? Should I invest out of state? Where should I invest? Thanks for any advice!

Hi Michael,

I think there are actually a lot of people in your shoes in the bigger markets like NY and LA.  I'd keep getting educated while stashing away as much money as possible each month and wait for a market correction.  You'll be better prepared financial and have the knowledge to take advantage of the opportunities that will arise.  Many of the experienced investors I know are just sitting on the sidelines because the cost is out of hand at the moment.  You may be able to find off market deals which would be your best bet right now but that would take a lot of marketing

It's going to be very hard to get strong positive cash flow on properties in that area unless you're getting them at a substantial discount off market. Those Hudson county towns are becoming like New York where you are investing primarily based on appreciation rather than cashflow. That's not to say you can't find one that will but you're going to have to find a very motivated seller with very few options. You can try union city or some of the surrounding towns for better cash flowing opportunities