All Forum Posts by: Phil Kogan

Wow - Phil are you in Brooklyn NY or Brooklyn Nova Scotia?  If you're from Nova Scotia (I've visited many times) there is nothing in that province like where you're looking to invest.   Zillow can be as much as $100k off in its estimates.  Look at this property in Essex county: http://www.zillow.com/homedetails/12-Claremont-Pl-...

If you walk this place you will find out that there's at least $150k in repairs.  Zillow has nothing more than an algorithm that can significantly mislead at times.   You should build a relationship with some of the local realtors that deal with investors to get your comps.  

There's a reason these places are so cheap in Newark and Irvington.  Seasoned investors have a whole myriad of troubles in these towns.  Good Luck. 

Great answer Tim Pagano

Phil Kogan

Couple points.

1. Don't use any automated ways to determine values, that includes Zestimate, Redfin estimate, or any other tool to claim to values in an automated way. Educate yourself on the proper way to evaluate comps, and to analyze deals for that matter.

2. Getting a real estate license is not the first step, unless your goal is to be a realtor. The first step is education on what makes a good deal.

Glad you found this site @Phil Kogan! Check out the education toolbar on the top. You can learn a lot from peoples podcasts or blogs. Have you acquired your RE license in NY yet?

Phil as an Essex County resident for over 25 years let me share with you what I know about this place.  Some of the wealthiest people in the nation and some of the poorest reside here.  It's so culturally diverse and rich community.  There are deals but don't be fooled by "low" prices.  You and I both know that NYC is flooded with foreign capital driving the RE prices through the roof, and consequently the surrounding communities are seeing an explosion in housing prices as rents force people from their neighborhoods.   

There are thousands of investors here in Essex County looking for deals right now. They understand the market and are tough competitors. You don't mention what kind of property you're looking for or what your investment goals are. You can be a slum lord or you can flip multi-million dollar houses here in Essex County. I know one area where you can do both within a 1 mile radius of each other.  Check out the Bamberger Mansion it's on the market. My point is you must define your goals much better before you anyone can respond to your post for information. 

I live 30 minutes by train from Madison Square Garden.  An investor purchased a house just down the block 2 years ago for the high $200's and sold it for just over $700k.  (Oh and BTW I'm still mad I missed that deal.)  My neighbors were astounded by this, but I understood why.  It took the investor nearly 6 months to get the town to approve his changes.  He turned a 2 bedroom house with no parking into a 3 bedroom house with off street parking.  It took nearly a year to work through the bureaucracy and finish the project and he sold it to a person from Brooklyn.  He was rewarded for his tenacity and creativity. This example is the most freakish I've seen so far.  FYI I bought a similar house down the block for $189.  

You can find deals in Essex County but understand that your sellers can see you coming from a long way off.  We know what's happening in NYC and we are prepared.  With that said pick your neighborhoods carefully and understand that just because it's cheaper than Brooklyn it doesn't mean it's a good deal.  Another word of caution, good contractors are really hard to find and your NYC contractor probably won't want to travel to NJ.  Also town building inspectors here are a source of revenue, and if you get caught doing work without permits it will cost you.  In Montclair NJ I've heard of penalties running into the 10's of thousands of dollars.  The contractors I work with are very cautious about being penalized. The good ones won't do work without permits. I'm not saying off permit jobs aren't being done.  I'm just saying if you get caught you're going pay fines and be delayed.  

Here's my last bit.  Doing one gut renovation is an achievement.  I know I've done many and there is a great satisfaction in it.  But RE investing is more about knowing and understanding a market and being able to discern the metrics of a deal.  Investors like safe deals with high returns, if you can bring those to the table the money will flow.   A good deal is a good deal in any market even though the price points could seriously differ.  You can succeed in Brooklyn just as easily as anywhere else.  I welcome you to Essex County, but you might want to dig into the resources here at BP, learn all you can, and clearly define your goals before you start investing in NJ.  PM me if you have Q's.

check out the book of flipping houses http://get.biggerpockets.com/flippingbook/?utm_sou...

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check out the book of flipping houses http://get.biggerpockets.com/flippingbook/?utm_sou...

ARV search results

https://www.biggerpockets.com/search?utf8=%E2%9C%9...