All Forum Posts by: Manan Singh

*Disclaimer - I'm a total beginner, so don't take anything too seriously. If you see any problem with something I said, please let me know

Hi everyone,

Been researching a lot, and lot of people in hot markets ended up employing a "rent by the room" strategy in order to House Hack. I know @Scott Trench has definitely talked about this before in some of his podcast appearances. This BP article by his friend Craig also illustrates what I'm talking about.

I think the same thing might be possible here in NJ. Use an FHA or an FHA 203b to finance a 2-3 sfh and put a renter in unused rooms.

At first I was thinking to try this in Jersey City (which would be a dream). However the big problem is that the market in JC is much more suited towards Condos which have those HOA fees. From what I've read, these fees can increase with short notice. Even if you do try to do this on a condo there, you will have to vet the HOA extensively and make sure that renting out your other rooms will be okay by them. Furthermore, usually the affordable condos are usually 1 bed 1 bath though, there could be an opportunity if you do what Craig did and live in the living room while renting out the bedroom.

So with JC out of the picture, I'm looking more into some areas a little more outside. There's been talk of Essex County having potential and that's where I'm starting to look now, the downside to this area is that there seems to be much more crime (i.e. Newark, East Orange). I don't exactly want to occupy a dangerous area for the minimum year it takes for the FHA. I would also recommend looking into Bergen County, as I recall Garfield NJ having some potential for this as well. Garfield is good because it's relatively safe and close to NYC, but the prices are still pretty inflated even for the fixer-upper kind of houses.

On more thing to be careful of with this kind of thing is the legality. I tried my hand at reading legal docs online for Jersey City, and it can be pretty easy to go wrong with this stuff! For anyone interested, you should def try to read as many legal docs as you can for your area of interest. This is a pdf of Tenant's Rights in Jersey City that I found. Papers like these give insight into what you should watch out for since NJ is supposedly a fairly tenant friendly state.

If anyone has anything to add or wants to talk about this stuff, feel free to reply or message me! I love discussing this stuff! But I'm still a beginner and don't know what I'm doing yet.

From one beginner to another (I haven't done a deal yet, but am in the process of raising capital), I agree with Antoine. I've been watching houses for a while there and there's just no way I have enough money to get involved. Even house hacking is tricky because the monthly payments can be so high. Unless you have capital, then it might not be up your alley.

Currently, I'm reading Long-Distance Real Estate Investing by David Greene and in his book he talks about how some markets are just not conducive to certain strategies or people. I think the JC market is definitely not for many beginner investors given that we lack capital and can't buy affordable multifamily units. That's why I think I'll have to agree with Antoine again and say that maybe you should look into long distance real estate investing. I highly recommend you read David Greene's book too :)

@Bunmi Familoni I'll definitely take you up on that offer, much appreciated.

@Marcus Lawson The fact that I would need 3 - 4 units just to get close to breaking even is a little discouraging if I'm being honest. I do realize it depends largely on the deal at hand but it's painful to have to deal with this when I know in other parts of the country, there are people who can even snatch up a profit while house hacking. But, for now, I'll deal with the hand I've been dealt and move forward. Thank you very much for the tip on sticking to how much I should lose, I'll keep that in mind and it's great to see I'm not alone in looking at those areas.

@Michael Lee I've been actually getting very interested in BRRR lately. To be honest the reason I haven't much thought about it is mostly because I'm still learning as I go and I don't know any contractors yet that can give me an estimate on how much it takes to rehab. I'm worried that I can lose a lot of money if I try something like that by jumping in too quickly. I might ask you some questions in a PM. And as of right now, I work downtown and live in central Jersey already! But the commute is pretty brutal.

@Sung Park I know there are better returns elsewhere but I also don't want to try long distance investing as I'm new enough as it is. But thanks for advice, I suppose I really do have to go the FHA route if I want to start this off right.

@Alex Kamunyo Thank you for the brief overview! I forgot that refinancing was an option out of the FHA. That is very helpful advice, I will look into this much more thoroughly from now on. The reason I was going for 20% down was because the FHA would make my monthly payment higher which I thought would make it more difficult for me to even make a profit. It seems I have much more studying to do.

@Vaughn Smith Thank you!

Hi all,

I'm relatively new to BiggerPockets and have been learning a lot! Right now I'm in a savings phase for what will likely be a year to year and a half. I recently graduated college and got a job in NYC and right now my current morning starts at 5:30 AM and my day ends at 7:45 PM, but I do get to save most of my income. I was wondering if anyone here has had experience house hacking as I don't want to live like this for more than two years. Preferably, I would like to be closer to the city. 

After browsing some old BiggerPockets forums it seems that there is some relative difficulty finding properties that cash flow along with House Hacking in NJ. Given this, I would be fine in breaking even or even losing a slight amount of money in a multifamily residential property deal. My goal is to simply lighten the commute to the city so I was looking at places like Rahway or Elizabeth where I see a multifamily houses up on places like Zillow or Realtor.com. I did see a person saying that they had success in Garfield NJ so I might check that out as well. Does anyone have any experience house hacking in these parts or perhaps in Norther NJ in general?

The hard part for me is that many of those properties can be 220-350k meaning that at minimum I'm probably looking at ~46k 20% down payment. After about a year and a half (or maybe two years) of saving, I should be able to save that much. Once I save it up, I'll probably take any deal where I can break even or lose slightly since I know that once I leave that property, I'll make a positive cash flow. I don't know if I want to get into an FHA loan as I would feel much safer paying off with the 20% down.

If anyone here does house hack, I would love to PM you some questions on your experience and how you went about finding a deal! Also if what I say above seems incorrect or too optimistic in assumptions, please let me know! 

Thanks!

Thanks! I'll be sure to check out your blog, you sound very knowledgeable! 

Thanks @James Wise! 

And thanks to you too @Jerryll Noorden! I have to say, "MONKEY POWER" is a pretty unique motto. I'll definitely remember that one!

I found it through researching about Financial Independence and Early Retirement on Reddit

Hi everyone, my name is Manan and it's a pleasure to finally make an introduction in these forums. Biggerpockets is an amazing place and I feel so lucky for discovering it early on and hope to learn and participate in this community as much as I can. That said, I am quite young meaning that I'm in the stage right now where I'm simply accumulating capital so investments won't be in the immediate future. Especially given how expensive the market here in NJ for multifamily housing is! 

I found Biggerpockets as I was going through researching resources for Financial Independence and Early Retirement, and I have to say this is one of the most impressive, helpful communities I've ever come across. The blogs, the podcasts, the articles have all given me enough confidence to say "I will go into real estate" regardless of what anyone says. It's truly a wonderful place. I've only browsed anonymously for a couple months and yet I've feel like I've learned years worth of knowledge, and the best part is, there still A LOT more I have to learn. 

Through making this account I'm hoping to create a personal network of like minded individuals who I can both learn from and teach. Who knows what the future holds? Partnerships, mentorships, friendships... There are a lot of possibilities! And so while for now I will keep learning and grow my funds, don't hesitate to shoot me a message and connect. I wish all of you the best of luck!