House Hacking in NJ

[Christopher Morris]

Hello BP, I have been reading up and listening to podcasts on house hacking especially in NJ (Jersey City, Montclair, Bloomfield). As I'm looking for a house hack, I'd really love to live in a decent area (some in Jersey City can be iffy). Has anyone had recent success stories in 2023? 

As home prices in NJ are very high, it makes the decision to go FHA VS live-in Conventional hard for me. I could put a down payment for a conventional (20-25%) 550k duplex, but I feel it could hurt my chances of buying as many duplexes in a 5 year period (for example) if I go conventional VS an FHA at 3.5%.

Any help would be appreciated!

[Dan Guenther]

Hey @Christopher Morris welcome to the community! 

First of all, you are on the right track regardless of the financing route you take. If you haven't already connected with an investor-friendly lender yet I'd highly suggest that. They will be able to walk you through the different scenarios with real numbers. 

Another thing to consider is your goals for this first house hack and your living situation. Is there a reason why you are set on a traditional duplex? Here in Colorado, we create a lot of non-conforming duplexes out of traditional single-family homes. Typically they have a side entrance that leads to the basement which can be easily split up with a door/wall. This allows investors to get into the market at way lower price points. Another benefit of this option is that it would allow you to get a conventional loan at 3-5% down. 

Reach out and I can help explain more/give you a few examples! 

[Christene Martin]

Hi Christopher, I am familiar with the NJ areas you mention. I've been living JC for 15+ years and have some investment properties in Guttenberg. I'd be happy to connect and chat about the area and financing options. 

[Shawn Mcenteer]

Hi @Christopher Morris House Hacking is NJ is great way to go.  Success stories are happening every day,  I have clients breaking record rents on house hack more so than ever.  

Great news, finding the right lender can solve the FHA or conventional problem. Long story short I have never put more than 10% down on a loan and I have never use FHA. Me and my clients all use a low money down conventional mortgage (as low as 5% down) with NO PMI and extremely low closing costs. This loans absolutely works on multi family properties and is the go to loan for North New Jersey. Your best bet is to keep liquid cash and avoid PMI.

[Christopher Mooney]

Quote from @Christopher Morris:

Hello BP, I have been reading up and listening to podcasts on house hacking especially in NJ (Jersey City, Montclair, Bloomfield). As I'm looking for a house hack, I'd really love to live in a decent area (some in Jersey City can be iffy). Has anyone had recent success stories in 2023? 

As home prices in NJ are very high, it makes the decision to go FHA VS live-in Conventional hard for me. I could put a down payment for a conventional (20-25%) 550k duplex, but I feel it could hurt my chances of buying as many duplexes in a 5 year period (for example) if I go conventional VS an FHA at 3.5%.

Any help would be appreciated!

It's tough out there to make numbers work! I've been considering house hacking in NJ. I live in a very desirably town in upstate NY, refinanced at a super low rate, so will keep the house as a rental. But I work in NYC and my WFH days are coming to a close. So I too am faced with this predicament.

Are you commuting into NYC? Or would you be open to other areas not mentioned that may be more affordable? 

[Christopher Morris]

Quote from @Christopher Mooney:

Quote from @Christopher Morris:

Hello BP, I have been reading up and listening to podcasts on house hacking especially in NJ (Jersey City, Montclair, Bloomfield). As I'm looking for a house hack, I'd really love to live in a decent area (some in Jersey City can be iffy). Has anyone had recent success stories in 2023? 

As home prices in NJ are very high, it makes the decision to go FHA VS live-in Conventional hard for me. I could put a down payment for a conventional (20-25%) 550k duplex, but I feel it could hurt my chances of buying as many duplexes in a 5 year period (for example) if I go conventional VS an FHA at 3.5%.

Any help would be appreciated!

It's tough out there to make numbers work! I've been considering house hacking in NJ. I live in a very desirably town in upstate NY, refinanced at a super low rate, so will keep the house as a rental. But I work in NYC and my WFH days are coming to a close. So I too am faced with this predicament.

Are you commuting into NYC? Or would you be open to other areas not mentioned that may be more affordable? 

Hey Christopher,

I do not go into the city. So I am not tied to a specific area. Just looking for the best duplexes / house hacking opps. 

[Christopher Mooney]

Just my thought is the closer you get to nyc the more you’ll have to spend

[Jose Gil]

Quote from @Christene Martin:

Hi Christopher, I am familiar with the NJ areas you mention. I've been living JC for 15+ years and have some investment properties in Guttenberg. I'd be happy to connect and chat about the area and financing options. 

 I would love to connect I also live in NJ and looking to househack as well. I want to learn what to look for before getting into a deal. 

[Account Closed]

Quote from @Shawn Mcenteer:

Hi @Christopher Morris House Hacking is NJ is great way to go.  Success stories are happening every day,  I have clients breaking record rents on house hack more so than ever.  

Great news, finding the right lender can solve the FHA or conventional problem. Long story short I have never put more than 10% down on a loan and I have never use FHA. Me and my clients all use a low money down conventional mortgage (as low as 5% down) with NO PMI and extremely low closing costs. This loans absolutely works on multi family properties and is the go to loan for North New Jersey. Your best bet is to keep liquid cash and avoid PMI.

What conventional loan/lender is offering less than 20% down and no PMI?

[Shawn Mcenteer]

Portfolio lender, they’re limited to certain counties though. Union county is as far south as they go at the moment. I am working on getting them to open more counties🤞

[Harold Looney]

Quote from @Christopher Mooney:

Quote from @Christopher Morris:

Hello BP, I have been reading up and listening to podcasts on house hacking especially in NJ (Jersey City, Montclair, Bloomfield). As I'm looking for a house hack, I'd really love to live in a decent area (some in Jersey City can be iffy). Has anyone had recent success stories in 2023? 

As home prices in NJ are very high, it makes the decision to go FHA VS live-in Conventional hard for me. I could put a down payment for a conventional (20-25%) 550k duplex, but I feel it could hurt my chances of buying as many duplexes in a 5 year period (for example) if I go conventional VS an FHA at 3.5%.

Any help would be appreciated!

It's tough out there to make numbers work! I've been considering house hacking in NJ. I live in a very desirably town in upstate NY, refinanced at a super low rate, so will keep the house as a rental. But I work in NYC and my WFH days are coming to a close. So I too am faced with this predicament.

Are you commuting into NYC? Or would you be open to other areas not mentioned that may be more affordable? 

@Christopher Mooney - I house-hack a 2 Unit Building in Bayridge Brooklyn which is a 45 minute subway ride to Manhattan Wall Street Financial District (a 7 mile drive). I do long-term room rentals (min 1 month lease). The average rent per room is $1100/month and have 6 rooms to rent. The rooms are unfurnished and the tenants are very low-maintenance (hardly know they are there). 2+Unit Buildings here and nearby currently sell for $1.5M on average.

I bought the property 16 years ago, so my mortgage rate is very low (2.2%) Even though the property is cashflow positive, my bigger play is the average 5% yearly appreciation.

I'm looking for others who are interested in house-hacking in this neighborhood.

[Alnazir Blackman]

Quote from @Shawn Mcenteer:

Hi @Christopher Morris House Hacking is NJ is great way to go.  Success stories are happening every day,  I have clients breaking record rents on house hack more so than ever.  

Great news, finding the right lender can solve the FHA or conventional problem. Long story short I have never put more than 10% down on a loan and I have never use FHA. Me and my clients all use a low money down conventional mortgage (as low as 5% down) with NO PMI and extremely low closing costs. This loans absolutely works on multi family properties and is the go to loan for North New Jersey. Your best bet is to keep liquid cash and avoid PMI.

Never heard of that type of loan. Would love to connect with your lender. 

[Sandeep Jain]

Quote from @Shawn Mcenteer:

Portfolio lender, they’re limited to certain counties though. Union county is as far south as they go at the moment. I am working on getting them to open more counties🤞

 I would love to connect with the lender too, I also live in Montclair and have few rentals in the area and looking to add at least one multi family this year. Thanks in advance for any information. 

[Ursula Lauriston]

Quote from @Christene Martin:

Hi Christopher, I am familiar with the NJ areas you mention. I've been living JC for 15+ years and have some investment properties in Guttenberg. I'd be happy to connect and chat about the area and financing options. 

 Hi Christene, would be great to connect with you too. I am in NYC but thinking of expanding my search to NJ. 

[Mike Teri]

[Dave Tab]

Quote from @Shawn Mcenteer:

Hi @Christopher Morris House Hacking is NJ is great way to go.  Success stories are happening every day,  I have clients breaking record rents on house hack more so than ever.  

Great news, finding the right lender can solve the FHA or conventional problem. Long story short I have never put more than 10% down on a loan and I have never use FHA. Me and my clients all use a low money down conventional mortgage (as low as 5% down) with NO PMI and extremely low closing costs. This loans absolutely works on multi family properties and is the go to loan for North New Jersey. Your best bet is to keep liquid cash and avoid PMI.

 Hey Shawn! 

Just wondering, when you say you never put down more than 10% and other other benefits you describe, I'm assuming that's just for a house hack/primary residence? Not for investment correct? 

[Shawn Mcenteer]

Hi @Dave Tab yes for the low money down loans as far as I know you need to be able to show you are occupying the property.   

[Anthony Swain]

Hey @Christopher Morris,

I piggyback on some of the others, but I'd connect with a referred lender ASAP to go over your options/budget/pre-approval. Next step, connect with a investor friendly agent that will help scout out properties for you and/or connect with you others in the space with something off-market. A great agent can be such a valuable resource on your 1st property, because of all the nuances in RE transactions.

Just an FYI, 5% conventional for MF is an option now. My wife and I were able to close on a duplex in December with the FAnnie Mae 5% conventional loan. IMO I think it's better than FHA, because you don't need to persuade seller to take FHA and no lifetime PMI.

I hope this helps Christopher! 

-Ant, Fellow House Hacker