Posted by Eddie-MI on July 21, 2003 at 15:12:26:
John,
What area you looking to buy in? What kind of money are you working with? Shoot me a private email.
I may have something available
An Apology and an Explanation - Posted by Ryan_MO
Posted by Ryan_MO on July 20, 2003 at 23:34:09:
Hello all,
In light of recent posts and threads created in response to my recent success story, I would like to clear up some things and apologize to everyone.
My success story is not false, it happened, i used OPM to buy one and am using $5000 for my portion of another. I apologize to anyone who took my story the wrong way and feel as if I falsified it.
We did secure financing from a nationaly know bank for the 10 unit park, I know there were questions about that aspect.
For both parks, they cash flow very very well positive, and have the NOI to value them the way I did. Now my question is this, if I did not mention the number of lots, would everyone have been ecstatic about the deals, because of the price I paid according to their revenue. But because i mentioned they were small parks with high rental rates, hardly anyone believed me.
I really do understand where some people are coming from when they try to explain how the properties could not be worth what I said. But on the flip side, value is subjective I have found out, and shouldnt something be valued based on its income stream rather than # of units?
I am young, and a bit nieve about certain things, I concede that. And while I may have valued these properties much MUCH differently than in the eyes of others, I look at it as I am recieving the same income as if I owned a 25 unit and 100 unit park, but with the expenses and worries of a 7 and 14 unit park respectively.
I do have a banker that will refinance my 7 unit, the same banker who is financing my 10 unit for $400k. He looks at the property’s cash flow, and so did his national underwriters, and i’m getting a rate under 5% for a 3-20 amortized loan.
I apologize for all of the confusion and misunderstanding with respect to my success story. If anyone wishes to talk with me about my story or the properties I have purchased and will close on in a few weeks, drop me an email privately so we don’t clog up the board like we did below, fountboy@msn.com is my personal email.
Sincerely, and apologeticaly,
Ryan_MO
P.S. check out Millionaire Trailer Parks on the Travel Channel right now.
- Aspen - $1 million + MHs
- I forgot
- New zealand
- One started and owned by Bing Crosby
…
Maybe my park would be worth a real $1,000,000 if it was on the ocean like #5. Haha.
Mobile home auction - Posted by patsears
Posted by patsears on July 23, 2003 at 17:06:10:
Ryan,
I was wondering about the auction that you said you got your first mobile home park at. How did you get involved with this auction and how do we get in on some of this action?
Thanks!
patsears
Lonnie Value? - Posted by patsears
Posted by patsears on July 22, 2003 at 11:02:03:
How about everyone at least agreeing that, as far as value and cash flow goes, it is defintely “GOOD ENOUGH”!
cash flow vs. resale value - Posted by Philip
Posted by Philip on July 21, 2003 at 14:15:18:
Ryan,
These parks will bring in the income that you say…no doubt.
What I would wonder about down the road is the resale value. And the ability to resell.
But you have a long time before you have to worry about that…so I wouldn’t worry about the folks who place value on it a different way…they just would have a different goal than you if they owned it.
I, personally, would also want a re-sellable park. Maybe the cash flow wouldn’t be as good. But I know that I don’t tend to stick with things for as long as some other folks…so I would probably look for parks with owner occupied units, lower cash flow, and maybe…maybe a easier re-sell.
It is STILL subjective and congratulations to you.
Philip
Re: An Apology and an Explanation - Posted by greg
Posted by greg on July 21, 2003 at 24:13:58:
Ryan, I do congratulate you on purchasing your first and second parks with opm. Most banks will not touch a park that is full of rentals. I dont care who you are and if they are section 8s. I know of a park in my area that has about 100 sites with 60 rentals, the park is in pretty good shape and has been for sale at 1,300,000 and cannot sell because of the rentals. The banker told me a few years ago that rental parks are a definate draw back. Rental parks are whole new ballgame then just receiving the rent on the lots. Sure the cash flow is great but at the same time the expenses are out of site. People dont care about the home because it is a trailer rental. And most the time the appearance of the park show that it is a rental park.
I think its great that you have done well already. The part throws people off is that you think a 14 site park will be worth a MILLION dollars. Those of us who know the business know that this is impossible. Im not making fun of you just some of the fiqures. Anyway good luck in the future, it seems you are off to a great start even if your math may be off.
GReg
Re: Mobile home auction - Posted by Ryan_MO
Posted by Ryan_MO on July 23, 2003 at 18:51:45:
Well… my business partner’s uncle is a former state senator who has a friend that runs an auction company, who just so happened to be holding an auction for a man that had prostate cancer and is retiring from EVERYTHING. The auction was all of his tools, an RV, GMc truck, flatbed trailers, and the 7 unit MHP next to his home he owned. So it was just kind of a lucky heard it through the grapevine deal that we found it.
Ryan
Re: An Apology and an Explanation - Posted by Ryan_MO
Posted by Ryan_MO on July 21, 2003 at 24:57:11:
Sorry Greg, I tried to email you back privately but your email came back as undeliverable. But thanks for the reply. One thing that kind of throws me off is that I have heard a lot of people here saying I can’t get a loan for something like this. But at the same time, I just recived an approval letter form my guy at US Bank for $400k, $320k for the property, and $80k for developments of 4 lots, plus my investment group is putting up $100k as a 20% downpayment. And the kicker here is all his superiors loved the deal, and they saw Section 8 as the most attractive thing next to my dad, who so happens to be a partner as well. Everyone has been saying no one will loan on something like this, especially it being Section 8, and i got an approval for a 3-20 at 4.6%!!! And the banker i am working with is the most productive banker for US Bank in St. Louis, not just some guy that is getting it done on the side under the table.
I guess I am way off thinking the thing will be worth $1 mil when all is said and done, but with a propety that nets $99,650 according to my projections, what should it sell for, regardless of the number of units? Thats one hting that is confusing me right now with everyone thinking I am on crack for valuating it at 1 mil.
Anyways, Im real tired, staying up late every night reading and writing on this board is killing my sleep pattern. Thanks for taking the time to reply to my post.
Ryan
Re: An Apology and an Explanation - Posted by John Hartl
Posted by John Hartl on July 21, 2003 at 14:37:21:
Ryan,
I read your success story in my CRE newsletter and wanted to congratulate you–but there is a second motive to my email. My wife and I are investors in Michigan and have done quite a few good lonnie deals and we do houses as well.
She is dying to buy a mobile home park. So I just thought I would contact you (you weren’t very hard to find after you said you were an “hourly” user on CRE) to see if you’d like to correspond. Ray Alcorn’s material just happened to arrive in the mail today. Have you read his stuff? I know she’d love to hear about your park deals–and who knows maybe we could collaborate on something. But I know she’d love to hear how ya did it. We have our attorney contacting the owners of a park here that has about 300 units but I’d like to cut our teeth on something a little smaller.
If you write back I will email you and tell you how to contact by phone.
Have a great day and keep on deelin’!
John