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Old 10-06-2013, 09:15 PM
 
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If you had 200k to purchase real estate as an investment in the NY/NJ area, what and where would you buy? We are inheriting a sum of that amount and like the idea of real estate as an investment, but we could use some direction.
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Old 10-06-2013, 09:18 PM
 
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Step 1: Rustle up another 200K. Then you might have a few choices.
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Old 10-06-2013, 09:31 PM
 
48 posts, read 99,024 times
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Quote:
Originally Posted by nybbler View Post
Step 1: Rustle up another 200K. Then you might have a few choices.
That's what my husband (the eternal pessimist) says. I am an optimist...but maybe foolish to think we could do anything with this $.
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Old 10-06-2013, 10:31 PM
 
Location: Randolph, NJ
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Buy what YOU know.
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Old 10-07-2013, 05:07 AM
 
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What do intend to do with this "investment"? Do you want this house as a rental, vacation, or primary residence? Do you intend to keep up the costs of owning a house on your investment? What about property maintenance, landscaping and snow removal? Water Heater, Furnace, Roof? These are all big ticket items that have a life limit and will need to be replaced - prepare to deal with shelling out $$$ for stuff like that. NJ Property Taxes can be upwards of $500 - $1,000 a month and go up through the years. Also things break and rot like pipes and wood. Collecting rent money means dealing with people - people who might not have the same values, cleanliness, be high maintenance types. Even if you get a good tenant, people who rent are typically only in their rental for a few years. Then you have to find a new tenant and hope they were as good as your last. Yes, you can check their credit but you can have good credit and still be a crappy tenant..and your crappy tenants boyfriend just moved in and is making your other tenants want to leave do to their behavior - but their credit was good (just things that happen, unexpected things that a credit report does not show).

Yeah real estate can be a good investment, but with it comes responsibilities. If you just expect to buy a house, rent it out and just collect the money each month and not put anything into your properties, then you probably should look at other investments.
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Old 10-07-2013, 06:39 AM
 
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You have lot of homework to do based on your question. What do I do with 200k in real estate is very blanket statement. There are at least four broad categories in real estate consumers and small investors like ourselves can get into. 200k is plenty for some form of real estate investment.

- Residential: What most people think about. Buy a place, renting it out. NJ has high prop tax, carry cost is higher but you get more space compared to say NYC

- Commercial: Could be many things, buying a commercial space to lease out in one form or another. Store space or facility to lease out to sb such as small boutique shops, car wash, etc.

- Land banking: Buying a property with plan/hope that value of land will rise. Land could have house or apartment on top but owner doesn't care too much about that.

- Stocks of Real Estate companies: self explanatory.

Once you have an idea, you do a deeper dive and figure out...do we want rental residential investment property? primary residence (of tenant) type of residential investment property? do I want to buy real estate company stocks such as CBRE? do I want to add cash flow by buying REIT company such as SPG

Last edited by babo111; 10-07-2013 at 06:50 AM..
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Old 10-07-2013, 08:55 AM
 
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Great questions! We talked it over and we envision paying cash for a condo within the NYC commuting area (even if it's only a studio being only 200k and all). We would rent it out. Our goal would be a condo with lower monthly fee, and figure taxes will be on the low end since only a low value condo. We will have money to do repairs etc and are happy to make improvements. We would hope to clear a little something each month (likely will save that to help with improvements and repairs) but mostly would see it as a long term investment.

Any thoughts about where we should look?

Last edited by rochie; 10-07-2013 at 10:22 AM..
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Old 10-07-2013, 06:46 PM
 
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If it was me, I would look in Hackensack Fairmont Section. But please keep in mind, being a landlord isn't all pie in the sky. I would suggest reading a book or two on the subject.
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Old 10-07-2013, 09:36 PM
 
Location: Westwood, NJ
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Definitely condo. Areas with condos in that price range include Cliffside Park, Englewood Fort Lee. Hackensack, and Teaneck. There are a few here and there in towns like Rutherford and Westwood also.

Rent them out for now, build up some equity, and sell when the condo market shows a significant improvement. When that will be, nobody knows!

Otherwise, with $200k, you could buy a fixer upper, but that would require extra cash for renovations.
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Old 10-08-2013, 11:06 AM
 
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Personally if I was investing 200K in Real Estate, I would go the multifamily route in poorer,more urban areas like Union City, Jersey City, Newark, or Paterson.
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