The issue with lower-end properties is that, by definition, the people that rent them are like one sick day away from missing rent.

People lose jobs, people split up, people get sick or in an accident.

Flood Insurance is fairly reasonable if the property is not in a high risk flood plain.

Plain and simple.

The landlord lose in most cases.During the last vacancy, my wife and I were both sick, the wife was hospitalized for pesticide poisoning doing work at the rental, so we lost six months rent @ $2,500/month.

She is sick for real

I’m in Scotch Plains and I’m very familiar with Berkeley Heights which is a pretty nice and would command good money on a move in ready property.

Purchasing it from an older gentleman (in his 80's) who is very sick.  

If zoning doesn't permit business leases, you can always have a real estate lawyer draft up a suitable NNN Residential Lease with Sublet Options... you just have to make sure it's worded plainly and with enough residential language to keep the city happy should they come knockin. :-)

Is it feet, yards, cubits (LOL) city blocks, water-meters, utility poles, sewer lines, or just plain up to the lender?