Multi-family Market in Mercer County, NJ

According to a recent post on Globest.com by Alyson Grala, "New Jersey employers have shed 94,400 jobs thus far in 2009, reducing the ability of households to meet monthly expenses. As a result, statewide apartment vacancy rose 130 basis points year-over-year to an estimated 4.8% in the third quarter."

In central New Jersey, about 290 new rental units have come on the market so far this year, and average rents have dropped roughly 1.5%. She states, "revenues remain stable in the Princeton/East Mercer County submarket as a result of steady demand generated by high student and employer concentrations."

The article continues, "In Central and Southern New Jersey, buyers are waiting for clearer signs of job and rental market stabilization before deploying capital. Nevertheless, some investors are staying active, spurred by cap rates in the high-7% range in Middlesex County and initial yields near 9% in Camden County...Compared to other core property sectors, apartments have fared best due to the availability of financing through government-sponsored enterprises Fannie Mae and Freddie Mac. However, recent modifications to GSE guidelines will impact lender decisions since borrower requirements include more substantial apartment ownership experience, according to William E. Hughes, senior vice president of Marcus & Millichap Capital Corp." Loan to value requirements now range from 55-75%, and rates depend on term and borrower strength.

If you are an investor, or would like to be, and see the opportunities in our low prices for multi-family properties, contact me to discuss rental property in Mercer and surrounding New Jersey counties.