I am working toward passive income to live off of.

To replace your income you need to flip a lot of houses, I'd do the math with an average 10-15% profit margin, because you have to account for some turds.The other opportunity is to change your job and take out the element that you hate.

(income = 3 x monthly rent, Debt-To-Income, etc. can still be used!)

Quote from @Max Emory: @Bob Asad, there are a lot of different account structures out there but absolutely keep security deposits in a separate account from your opex/income account. 

Typically 75% of rental income can be applied towards your DTI for qualification. 

My goal is to leverage that equity for additional income.

3) Average income was up 4.5% in 2024.

If your goal is passive income, it's not going to be in New Jersey when you factor in cost to purchase, management costs, and rent to price ratio, but what you can get is steady appreciation.

Quote from @Raghavendra Jakkani: The tenant should provide proof of income that doesn't require detective work.

Income from leveraged real estate or active business income.