Posted by johnB_NJ on February 16, 2001 at 14:30:48:
John,
I appreciate you taking the time to respond to my post. I will be taking yours, as well as Lonnie’s, advice. I do not think this park is a place for me to do business in. I am sure the aggrevation level will not be worth the yeild spread.
Thanks again
Sincerely,
John Bittel
Dealing with Park Policy…Need advice…long - Posted by JohnB_NJ
Posted by JohnB_NJ on February 15, 2001 at 22:59:28:
Hello
I need some advice from some seasoned MH investors. I have not purchased a MH in my investment career. There are not many parks in my area but the one park that is nearby is very hard to deal with. Here is the situation…
I get a call to purchase a 14x70 2bed, 2 bath home. It is not in great condition but not bad. It needs some rotted flooring replaced, a good cleaning and carpet. Owner wants $1000 but we settled at $750.00. This home will easily sell for 6 or 7k with owner financing. I would need to drop about 1.5k into it (that includes furnance changeover…see next paragraph)
Now here is the problem. I called the PM. She was very nice onthe phone (btw, PM doesn’t reside in the park…she lives over an hour away…). I inform her of my contract to purchase the home and I wanted to know if the lot rent was current. It was current but she informs me that in order to purchase the home, the owner must first convert the furnance from fuel oil to natural gas. She says that has been “court order”. So I asked her what I could do in this situation since the sellers do not have the cash to convert and I was not going to convert until I have title. So I asked her if I could purchase now and convert later before I move in my buyer. She says, “No, the owner of the park wants the conversion done first.” I asked her what I can do in this situation and if she would talk with the owner. She told me she would talk with the owner and get back to me. I also asked her in a hypothetical situation where someone unknowingly purchased the home without park approval. She said that is called “midnight dealing” and “we would evict the tenant and have the trailer removed fromthe property in under 30days.”
Not to mention that the Park wants ‘A’ credit buyers. WOW that is something that I find hard to believe. I have seen some of these trailers…no way these folks have ‘A’ credit. I can understand the crimal background check and I can understand credit checks…but ‘A’ credit??..
There is also a good number of empty pads in this park and rumor has it the NJDOT wants the land for a bypass road in the future. So I would have to think the the owner would like to drive off as many homes a possible so he doesn’t have to pay to move them in the future. I did ask the PM about the NJDOT rumor and she says “it is a possiblity and the the owner of the park is looking for land so that the homes can be moved to if needed in the future.”
I did ask the PM what the park would do if the owner could not afford to convert the heater (I know they can’t afford to do it) and just abondone the MH. She said they would junk it.
So, to make a long story short…how do I solve this catch 22. Or should I just say “sorry, no can do” and go back to what I do best and stick with SFH.
I would appreciate any advice. I know I can make a nice yield but i rather not have a ton of headaches. My sixth sense says…drop back 15 yards and punt…
Thank you in advance for any advice.
Sincerely,
John Bittel
Re: Dealing with Park Policy - Posted by Lonnie
Posted by Lonnie on February 16, 2001 at 07:31:59:
Hi John,
If you had already done some deals, had some experience in the biz, had worked with PM’s and knew your market, this might be worth checking into. But for your first deal, it has too many potential problems that may be out of your control. Plus the amount of work it needs, and a PM looking over your shoulder. Not to mention that third party “bad guy” who you don’t get to talk with (the park owner). No way to know what else the owner might come up with, once you buy the home.
This is not one that I recommend you cut your teeth on. Keep looking until you find a park, and a PM that wants your biz. Consider this one a “practice deal” and learn what you can.
Good luck,
Lonnie
If they don’t want to cooperate… - Posted by JHyre in Ohio
Posted by JHyre in Ohio on February 16, 2001 at 07:15:56:
PASS! It’s not worth the hassle. I’ve had a home in a difficult park for some time- its more aggravation and expense than I need. This park thinks it can fill its empty spots by taking only "the best’ buyers…except that such buyers won’t live in a park with low-end homes (or people)…see it all the time. Park goes from being too easy to too picky w/o making the requisite improvements. They should read Ernest Tew’s book to see how a true upgrade is done.
John Hyre
Thanks for the advice… - Posted by johnB_NJ
Posted by johnB_NJ on February 16, 2001 at 14:28:13:
Lonnie,
Thank you very much for the advice. I agree. I buy SFH and I very rarely get a shot at a mobile home since there are only a few mobile home parks in my area. So my experience with MH’s is what I read here and what you have taught me at the CRE conventions.
I know if I could sit down with the owner or the park manager, I know we could work something out. But again, my “little voice” says, that the owner wants to drive off homes so he can deal with the NJDOT without having to pay to move the homes to new locations. So, the owner of the park might not want to work with me. Either way, I do value your advice and it is much appreciated.
Sincerely,
John Bittel
PS: I look forward to seeing you and your wife again in Atlanta.