Deciding to invest in New Jersey rental properties is an excellent idea for many reasons. This is a great way to establish financial security and build wealth. There are also a lot of opportunities in the local market. New Jersey offers single-family homes in established neighborhoods, new construction multi-family buildings with a lot of units, and everything in between.
At KeyVest, we always recommend that investors consider buying more than one property when they can. Owning multiple rental homes makes protecting yourself against vacancy a little easier. You’ll also be able to diversify your real estate portfolio and have more flexibility in how you make investment decisions going forward.
Single-Family Homes in Good Neighborhoods
Single-family homes are always going to make great investments, especially when you’re buying rental property in New Jersey. There are several neighborhoods throughout the state where well-maintained homes are in high demand. Tenants will usually be comfortable paying higher rents for the space and privacy that come with single-family properties.
If you invest in several of these properties that are attractive and in a desirable location, you can earn some excellent rental income and build exceptional returns on those investments. Single-family homes will also appreciate quickly, and you’ll find that the value of your asset climbs reliably year after year.
Multi-Family Properties for Diverse Portfolios
In addition to buying single-family homes, investors should consider multi-family rental properties. These investments will provide more income for you and less risk. Instead of collecting one rental payment every month, you’ll collect two or three or four or even more. This protects you against vacancy costs. If one unit is vacant, you still have income from the other units.
Lower risk and higher cash flow are two good reasons to invest in both multi-family homes and single-family homes. Buy in different neighborhoods and buildings, and see which properties perform best. It’s a great way to measure your investment success and make adjustments as needed.
More Properties Leads to More Investing Power
Another great reason to buy more than one New Jersey rental property is that it allows you to diversify your investment options, especially when it comes to financing. Some investors prefer to pay in cash and others like to leverage their investments with a traditional mortgage. Owning more than one rental property will make you a better credit risk. It also gives you more access to equity and cash if you need it.
Look for different ways to finance more than one investment. You can find creative ways to borrow money, even structuring the deals so that you’re not throwing down a large down payment. If you’re primarily or completely paying the principal, you’ll find your cash flow and your ROI can improve quickly. You can also maximize your multiple properties to continue investing through things such as a 1031 exchange.
The New Jersey real estate market provides investors with a lot of opportunities, and we want you to maximize what you can earn in this region. To learn more, contact us at KeyVest LLC, and we’d be happy to help.