Strong preference for properties that are close to the light rail expansion projects that are currently being finalized in Houston.Hopefully the properties are cash flow positive, but I am willing to go underwater since I am expecting at least 10% annual appreciation over 5 years.Close in properties are very difficult to find (and lock).

Others find the expansion comes at a very acceptable cost and the expansion helps raise the total returns.

Also, some regions have issues with expansive clay soils (requiring continued maintenance over seasonal changes in soil moisture content).

Are you near the school or the new tech expansions?

I will be focusing initially on Hudson and Bergen counties with plans for further expansion in the future.

Appreciation in multi-family is tied to expansion of rent revenue, which is a function of desirability of your units, building, location, etc.

Even better, is to do this now (while the expansion is fairly healthy) and also reducing exposure over the next year or two. 

I've owned property in TX where flooding, termites and expansive soils are an issue.

The main problems you have with foundations is poor drainage, poorly compacted soils, expansive soils or some combination thereof.

@Henry - Agreed about the good investment, but my concern is the issue of getting the permit for the revised 4bedroom layout (usually if 2 bedroom single story is remodeled with 4 bedrooms without expansion, it's very likely that it violates the code).