Posted by Craig on September 20, 2004 at 13:27:32:
The only thing I know about the sellers is the are absent (about an 8 hour drive away) and want the place sold. They let it run down so far that the tenants that are left are refusing to pay any rent.
I am also thinking of buying mobiles and moving them there, and putting them up for sale setup and ready to go.
The old ones sell really cheap here as none of the parks want them if they are over 5 years old.
Buying a mobile home park - Posted by Craig
Posted by Craig on September 17, 2004 at 13:20:15:
Is this strictly for buying Mobile homes
I have a deal to buy a mobile home park, and I’m not sure what I should be looking out for.
This is in a very small community, I think only about 5000 people.
On the plus side, it is selling for 25 to 30% of its FMV.
Lots of upside. It has been very badly managed due to absentee owners.
But on the downside. The park is only half full and the tenants there are not paying the rent.
And there is a large mill 30 miles away that recently closed down. The mill has been purchased by another company and may reopen.
If the park was full it would have a CAP rate of 23% which is incredible. It would pay for itself even with just the current tenants. (if they were made to pay)
There are also 3 houses and a small coffee shop there, all are currently empty. One of the houses is damaged from a grow op and needs some repairs before it can be rented.
My take on it is that it is a really high risk with a potentially high return.
Re: Are You Paying All Cash or Need a Loan? - Posted by Cheryl Lopez
Posted by Cheryl Lopez on September 18, 2004 at 15:00:45:
CRAIG –
Are You Paying All Cash or Need a Loan?
If you are paying all cash … then you can do whatever you think is appropriate and want to buy.
But unless you have the “all cash” and require a loan with a downpayment … then the lender will call the shots. And guaranteed the lender will see this park and current & future situation a lot different.
Cheryl Lopez
Re: Buying a mobile home park - Posted by John
Posted by John on September 18, 2004 at 24:31:03:
Craig,
You are completely correct about the risk. And MAYBE correct about
the potential.
Do you have the time to put into this project?
There may be ways to lower the risk. What do you know about the
sellers?
John
Re: Are You Paying All Cash or Need a Loan? - Posted by Craig
Posted by Craig on September 20, 2004 at 13:21:59:
Well I don’t have the cash but I do have enough equity in other properties, and I will be doing this with my son inlaw. He also has several pieces of property, all paid for.
So he will be taking care of the place. He is currently off work for a year on paternity leave. Kind of convenient. So he can spend the time fixing the place.
The plan would be to fix the place up, try to fill it with trailers and then put it up for sale again.