All Forum Posts by: Terence Eng

@Sunny Burns,

hah, as you seen from the post above by @Rose Zhang (The GF), we were both at your first meetup last month and it was great!  We were up in the 2nd row and was crazy to find out we pretty much work at the same place, (and finding out others at the meetup were from there too!)  Small world!  

We'll definitely be attending the next meetup and looking forward to it!

-Terry

@Moises Mari,

wow, thank you for such a detailed response and tips! My GF has been preaching we should be looking at the 3-4 over 2 families for exactly what you had mentioned. The better return on cash flow and the spreading out of the taxes over more units.  Running numbers on 2 family results in rather thin returns or negative returns.

Noted on the Contractors, and I agree I would not want to get the same job done twice! When starting out looking for contractors did you mostly go off of other's recommendations, look up in local directory and call them up ask for bids/previous job referrals?  There's a lot of new construction in my area, of the trucks outside the job site I was planning on taking pics of their vans and calling them up when time comes for rehab.  I figure if they are being used in the neighborhood for these nice new condos they should be doing some good work.

Yes the taxes in NJ are crazy, and I'm accounting for them in my expenses when running the numbers which like you say eats into the returns.  Going back to your 1st point, that's where 3-4 units will really help shore up the returns.  Agreed Garfield is low inventory but will still be keeping a pulse on there for anything to pop up and run the numbers.  Newark does have more inventory however some that need large rehab at our entry point, I'm not sure if it would be a good undertaking for first investment.

Noted on the Tenant Screening, I'm going to be searching through the forums and gather some best practices and also when time comes to utilize some online landlord management sites like cozy or turbotenant to assist in that matter.

thank you again for the info/tips!

-Terry 

@Allan Szlafrok, oh yeah we were driving around the Bergen/Lafayette area closer to the Greenville section and there are definitely some rough areas that we're not too comfortable with. I think it will still take some time for it to turn for the better, although I hear its coming.  In Newark we drove around the University Heights area (looked promising) and Lower Vailsburg  (not so great). I live in the Heights of JC, bordering Union City and feel that are is not as rough, but as you say some towns are a pain in the butt with permits and approvals and I believe UC is one of them.  Plus the taxes are killer!

I touched on some of the towns rent control laws, I'll still need to read more and understand them correctly. I know UC recently amended their laws to now include 3 unit non owner occupied under their rent control laws.  Most towns rent control I'm only allowed to raise rent a specified percentage correct? If I inherit an existing tenant upon/if their lease renewal I'm bound to that percentage?  However if I sign a new tenant is that rent bound to that % also, unless I rehab and add value to that space to justify a increase (perhaps to market rates) for that unit?

thanks so much for your info/response!

-Terry  

Hello BP community, 

My name's Terence (Terry) Eng I'm a software engineer by day and I'm looking to join the ranks of the many successful BP members in this Real Estate game.  I've stumbled upon BP about 7 months ago and started taking in all the basics and information that I can.  

I started with the UBG, started listening to the podcasts (about 2/3 of them so far) and lurking on the forums searching for topics of interest that I wanted to focus on or information that I didn't know. Picked up a few books and read through, "Building Wealth One House at a Time" by John Shaub, "The Book on Investing in Real Estate with No (and Low) Money Down: Real Life Strategies for Investing in Real Estate Using Other People's Money," "The Book on Rental Property Investing: How to Create Wealth and Passive Income Through Intelligent Buy & Hold Real Estate Investing!," by Brandon Turner, "The Book on Estimating Rehab Costs: The Investor's Guide to Defining Your Renovation Plan, Building Your Budget, and Knowing Exactly How Much It All Costs" by J Scott and found them all so informational it has got me amped! I have also turned my girl friend on to REI, she joined BP as well and now we both are excited and trying to learn as much as we can.

Our strategy is to pursue some buy and hold rental properties within a range locally to Jersey City, Bayonne, Union City, Newark, Garfield, and with the prices and returns here we feel the multi-family (2-4 Units) realm would yield better than SFH properties. It's a little tough to find good value add deals with low entry points, but we're on the sites looking at potential listings, driving the areas getting to know the people and neighborhoods, and analyzing the numbers/scenarios to see what the COC and Cap Rates would be, while we line up the funding side. Of course we're new to this so some items like estimating rehab and rent rolls (using rentometer) could be off a bit.

So as I mention I live in Jersey City, currently own a condo which has appreciated nicely since I had purchased back in 2012. Our plan was to obtain a HELOC to fund the value add investment properties' down payment and potential rehab costs, then secure long term conventional financing for the rest of the purchase price, and refi later on down the line to pull out the cash laid out and pay back the HELOC.

I've been looking up HELOC rates of various big banks, credit unions, and local smaller banks. I have excellent credit rating, and only 1 CC left to pay off (~$6k); for the HELOC amount I am targeting, Affinity FCU (2.99% first 12 months, Prime after) and Santander (3.99% first 12 months, Prime -.75%) are the front runners, however I am looking for other banks that could have better rates. All assuming they will qualify me for those best rates.

If you made it this far in my introduction wall of text, thank you for making it through! 

I look forward to learning more, meeting other local investors in the area, contributing back to BP and jumping into the game!

-Terry

Hi all,

I've been looking into UC as well for multi families, not sure if anyone of you know/knew...UC  amended their rent stabilization laws to include now 3 family dwellings for Non-owner occupied. 

https://cecininilaw.com/uploads/3/4/4/9/34496198/o...

here is the UC ordinance online although it seems this has not been updated yet to reflect the above: https://www.ecode360.com/15397000

My question is, if you DO owner occupy a unit in the 3 family, can you then raise rents to market value? 

If you acquire a 3 family, and house hack 1 unit and the other 2 units are rent controlled do you wait until their lease is up, and upon lease renewal raise the rent to market value?

Hi @Tao Chen,

good info from this thread, i'm from the area also and looking into similar investing spaces as you.  I'll shoot you a message!

thanks!