Buying a rental property

amother

Sun, Mar 03 2024, 5:27 am

I have money bh that is to be used for down payment. Would take us another few years to save the rest needed to buy in Brooklyn.
Is it a good idea to buy in Jackson/toms river and rent it out? Are people looking to rent in those areas, or do they really only go to buy?
How much would a 4 bdrm with kosher kitchen, big property go for?
thinking we can use the rent to cover mortgage and use the rest to save up for our own down payment in addition to what we’re saving now and then maybe sell it.
Other alternative is to keep saving and take advantage when the rates drop a little, I just don’t know when that’ll happen and I hate the thought of so much money sitting.

amother

Brickred

Sun, Mar 03 2024, 5:33 am

amother OP wrote:

Jackson and Tom’s River are not the places to invest these days. They are at premium prices and you won’t make money (you’ll probably lose some)
You can try finding a refresh property in an area that’s not so expensive but in general, RE investing is not going great these days (my husband is in the business)

amother

Brass

Sun, Mar 03 2024, 6:12 am

Why is your money just sitting?

At the very least you can put it in a high interest FDIC insured savings account or CD and it will be earning a good amount - especially for a no risk investment.

There are also relatively safe forms of investments that would be fine but might not be at the peak if you needed to access them. In other words, the stock market has historically done well for long term investors but if you needed to sell during a down period, you might not get those gains.

I know there are some imamothers who feel that real estate investment is a great way to go. But I think it is too problematic for a typical person. You need to mange the property; you need to deal with tenants; you need to be able to afford maintenance or if the property is vacant.

amother

Apricot

Sun, Mar 03 2024, 7:11 am

You probably won't make money at todays prices but you still have a house that in theory you could move into if you decide to leave Brooklyn. If you but elsewhere you may make more money but (1)if you are not a professional real estate investor you will have much more headache in an area that you are not familiar with and doesn't have a frum population and (2)if thins don't work out you may lose a lot of money on the house and you won't be able to fall back on moving into it

amother

NeonPink

Sun, Mar 03 2024, 7:21 am

You can try running the numbers for a property in or near Linden, NJ and renting out to a nonjew. Even then there probably won't be much or any profit.

I've done it near KJ. I've made a bit of profit but I bought before COVID. (30-40k down) I don't own yet in Brooklyn tho. Be ready to deal with tenants not paying, eviction, loss of rental between tenants etc.
You've got to be a bit of a risk taker.

amother

Mon, Mar 04 2024, 7:11 pm

Right now it’s in a cd. Managed to lock in a good rate, it’s over in a year.
It’s not just sitting but I’m not sure I’m investing it properly. CD’s are very “safe”.
Stocks are another option but they’re also risky
I’m young, I don’t know anything about managing properties or dealing with tenants. Maybe I’m a little over my head over here

Amarante

Mon, Mar 04 2024, 7:16 pm

amother OP wrote:

In the long run, stocks are a good investment. The issue is that if you need the money when the market is down, you might be forced to sell.

You can dip your toes in the water as one of the best ways to invest is just do a small amount each month so that way you are going to average ups and downs. Again, this is money that you don't need as you should have at least six months expenses in a liquid safe place so that it is available without selling your stocks.

As an investment vehicle, an index fund from Fidelity or Vanguard is a safe bet. Because the fees are low the net result yields are higher than more managed funds. Call up Fidelity or Vanguard and open up an account. You can start with $500 or $1000 - a minimal amount and then just add to it at fixed times because you can't beat the market. Over the long run, it will average out.

It would be very foolish for you to buy a house and rent it for a whole slew of reasons.

mig100

Mon, Mar 04 2024, 7:17 pm

amother OP wrote:

amother

Mon, Mar 04 2024, 7:18 pm

Not looking to make tons of money off it… If we can get rent to cover mortgage and flip it in a few years hopefully it’ll have gone up in value and we’ll have made money on it
It just sounds like a better investment than a cd
If not Jackson/toms river any other places come to mind? Or other ideas how to invest it?

mig100

Mon, Mar 04 2024, 7:22 pm

amother OP wrote:

I agree. There are a lot of closing cost involved. Its only worth it if you can hold onto it for at least a few years. It also depends how much money you have for down payment

mig100

Mon, Mar 04 2024, 7:25 pm

[quote="amother OP"]

mig100 wrote:

I say go for it. I think its a great idea. You can get a property manager for 100 a month. They deal with the tenants.

I think you need at least 100k probably more. You will probably need to put down 20% or more for an investment property. rates are also higher on an investment property.[/quote

I dont want to use all the money because I want to leave some as a breather for ourselves, looking to put down aabt 150k including closing costs, but I have no idea about any of this.

I have a property that could work for you. if you want you can pm me. Or I can set up an annon - email address.

amother

Papaya

Mon, Mar 04 2024, 8:21 pm

amother OP wrote:

Depending on the price and neighborhood. Maybe you can get rent to cover the mortgage. But that's a big maybe since the rates are so high now.
A RE agent should be able to help you with the numbers.

And yes, rentals are in demand in those areas.

The prices in Jackson are going up and up and up. So it's safe to assume that the value would be higher when you want to sell.

My husband's friend sells investment properties in new Jersey. Some with tenants already. I can find out his number if you're interested. But none of the properties are in Jackson or Toms river. Those prices are over the moon.

amother

Mon, Mar 04 2024, 8:23 pm

Amarante wrote:

What are the reasons it would be foolish?
The money we have for down payment we didn’t save up for, I guess you can think of it as a kind of gift. So idk if I’d put it into stocks, especially since we want to buy as soon as possible before tuition, etc. Not looking for this money to be invested long term. Want something I can sell in a few years, it’ll go up a little in price by then and we’ll have more to add to our down payment where we want to buy.
but we have set amount that we save each month. Is it a better idea to invest in an index fund or etf monthly instead of putting it straight into savings?