December 17, 2025 | Fresh Inventory Report
🎯 BUY RECOMMENDATIONS
🏆 #1 BUY: ORANGE — 3 Units — $500,000
240 Watchung Avenue | MLS# 25043202 | DOM: 3
The Setup
Three-family in highly sought Orange neighborhood offering exceptional value at $166,667 per unit. Property shows verified rent roll with units at $2,300/month. Duplex-style configuration with 2BR/1.5BA on each side plus additional unit. Investment opportunity with live-in potential or full rental play.
The Numbers
Metric | Value |
|---|---|
Asking Price | $500,000 |
Units | 3 |
Price Per Unit | $166,667 |
Year Built | 1950's |
Lot Size | 5,319 SF |
Annual Taxes | $12,379 |
Est. Monthly Rent | $6,600 |
Annual Gross Income | $79,200 |
GRM | 6.3 |
NOI (45% expense ratio) | $43,560 |
Cap Rate | 8.7% |
Cash-on-Cash (25% down, 6%) | 13.3% |
Why It Works
Highest cash-on-cash return in today's analysis at 13.3%
Strongest cap rate at 8.7% provides substantial margin
Lowest price per unit ($167K) in Essex County
GRM of 6.3 indicates strong value pricing
Essex County location with NJ Transit NYC access
Verified rent roll showing $2,300/unit performance
Due Diligence Required
Verify actual unit count (listing shows 3-family, remarks describe duplex)
Confirm current tenant leases and rent roll accuracy
Full property inspection given exceptional pricing
Research Orange rental comps to validate $2,200/unit rents
Review property tax assessment and appeal history
The Play
Best sub-$600K opportunity in Essex County. Even with conservative $2,200/unit rents, property delivers 12%+ CoC. Strong fundamentals provide cushion for unexpected repairs or vacancy—budget $20K reserve and returns remain above 11%.
🎯 #2 BUY: EAST ORANGE — 2 Units — $379,000
31 9th Avenue | MLS# 25042320 | DOM: 13
The Setup
Value-add opportunity in East Orange at sub-$400K entry. Two-family requiring repositioning with clear path to forced appreciation. Property's low price signals deferred maintenance—ideal for hands-on investor or contractor-backed buyer targeting rental optimization.
The Numbers
Metric | Value |
|---|---|
Asking Price | $379,000 |
Units | 2 |
Price Per Unit | $189,500 |
Annual Taxes | Est. $8,500 |
Current Est. Rent | $3,800/month |
Annual Gross Income | $45,600 |
GRM | 8.3 |
NOI (45% expense ratio) | $25,080 |
Cap Rate | 6.6% |
Cash-on-Cash (25% down, 6%) | 5.3% |
Post-Rehab Cap Rate | 8.2% |
Post-Rehab Cash-on-Cash | 9.8% |
Why It Works
Lowest absolute entry price in analysis
Clear value-add path to premium returns
Post-rehab projection: $2,200/unit = 9.8% CoC
Low basis provides equity cushion for improvements
13 DOM indicates negotiation leverage
Essex County location with Newark proximity
Value-Add Strategy
Current State: $379K purchase + $40K rehab = $419K all-in
Target Rents: $2,200/unit post-renovation
Post-Rehab Metrics:
Monthly Income: $4,400
Annual Gross: $52,800
NOI: $29,040
Cap Rate: 8.2%
Cash-on-Cash: 9.8%
Rehab Budget Allocation (est. $40K)
Kitchens/Baths: $20K
Flooring/Paint: $8K
Systems (HVAC/Electric): $8K
Contingency: $4K
Due Diligence Required
Comprehensive property inspection (foundation, roof, mechanicals)
Title search for liens or encumbrances
Current tenant status and rent collection history
Neighborhood rental comp analysis ($2,200/unit validation)
Permit research for legal unit configuration
Plan review meeting with local building department
The Play
Best sub-$400K opportunity with clear forced appreciation path. Low entry provides equity buffer—even with $50K in unexpected costs, all-in basis of $429K at $2,200/unit still yields 7.8% CoC. Ideal for investors comfortable with value-add execution.
📊 MARKET OVERVIEW: OTHER PROPERTIES ANALYZED
Properties Reviewed: 21 listings outside Newark/Paterson, sorted by price ascending
Market Snapshot:
Today's sub-$800K inventory outside Newark/Paterson reveals a bifurcated market—premium-priced properties in Bergen/Hudson Counties (Clifton, Garfield, Jersey City) trading at 10-13x GRM with sub-2% cash-on-cash returns, while Essex County secondary markets (Orange, East Orange, Belleville, Irvington) offer better fundamentals but require careful market selection.
Key Findings:
Bergen/Hudson County Properties ($600K-$800K):
Clifton ($799K, $650K, $600K): Premium pricing at $325-$400K/unit delivering 0.4-1.4% CoC—priced for owner-occupants, not investors
Jersey City ($687K, $749K): PATH access commands 11-12x GRM with negative to minimal cash flow; pure appreciation plays
Dumont ($600K): Bergen County school premium evident at $300K/unit but 1.7% CoC doesn't justify entry
Wallington ($641K): Small-town appeal insufficient at 0.8% CoC and $320K/unit basis
Passaic ($775K): Verified $7,500/month rent roll delivers workable 5.2% CoC but $13,700 taxes compress margins
Essex County Properties ($379K-$725K):
Belleville ($550K, $675K, $725K): Range of options at $242-$338K/unit with 4.2-6.3% caps; best performer at $725K needs negotiation to $700K
Orange ($500K, $590K, $645K, $725K): Market leader with $500K property delivering 13.3% CoC; other Orange listings overpriced at 5-6% caps
East Orange ($379K, $599K, $664K, $728K): Wide price dispersion reflects condition variance; $379K value-add play stands out, others show 4.8-5.7% caps with thin margins
Irvington ($650K, $700K, $799K): Mid-market positioning at $233-$267K/unit but 2.2-5.7% caps insufficient for cash flow investors
Passaic County Mixed Bag:
Garfield (multiple listings): Already-promoted $400K distressed deal aside, market shows $275-$375K/unit pricing with mixed results
Clifton: Multiple listings at $600-$800K demonstrate pricing pressure from Bergen County spillover
Lodi: $599K entry shows 5.1% cap and 1% CoC—typical for area's Bergen County aspirations
Notable Patterns:
Tax Burden Crisis: Properties with $11K-$16K annual taxes universally show challenged economics; tax load averaging $5K-$8K/unit creates cash flow headwinds across price ranges
GRM Inflation: Median GRM of 10.2x indicates sellers pricing in appreciation rather than income performance; only 3 of 21 listings show sub-8.0 GRM
Cap Rate Compression: Average cap rate of 5.4% reflects low inventory and buyer competition; only 2 properties exceed 8% cap threshold
Price Per Unit Escalation: $275-$375K/unit now standard for functional properties in secondary markets; sub-$200K/unit limited to distressed or value-add opportunities
DOM Correlation: Properties with 7+ DOM show 0.3-0.8% higher cap rates, indicating negotiation opportunities as seller urgency increases
Investment Themes:
Location Premium Unsustainable: Bergen/Hudson County pricing (11-13x GRM) has decoupled from cash flow fundamentals
Essex County Sweet Spot: Orange/East Orange offer best risk-adjusted returns at $167-$242K/unit
Value-Add Required: Sub-$400K properties exclusively need repositioning capital to achieve pro forma returns
Tax Arbitrage Exhausted: Properties outside traditional high-tax towns show minimal advantage as assessments converge
Distressed Opportunity Window: Bank-owned/short sale properties remain only path to sub-$200K/unit pricing with workable returns
🎬 BOTTOM LINE
Two actionable opportunities in today's market:
Conservative Capital: Orange 3-family at $500K delivers institutional-grade 8.7% cap with 13.3% leveraged returns—rare combination of safety and performance.
Value-Add Capital: East Orange 2-family at $379K provides clear path to 9.8% CoC post-renovation with substantial equity upside.
All other analyzed properties suffer from price/performance disconnect typical of low-inventory environments. Patient capital wins—wait for motivated sellers or distressed opportunities rather than chasing overpriced stabilized assets.
Market remains seller-favorable with buyers accepting sub-5% cash-on-cash returns on most properties. The Orange and East Orange opportunities stand out precisely because they buck this trend.