Posted by Ted on January 29, 2002 at 24:36:48:
A manufactured home can be retitled from personal property to real property BUT you better find out all the in’s and out’s of it first. It can take months and many inspections by CERTIFIED INSPECTORS. Make sure you do all of your homework before diving into this one. Is it possible to get it presold?
First Deal…HELP!! - Posted by Mich_Mike
Posted by Mich_Mike on January 28, 2002 at 17:18:48:
I haven’t dealt in mobile homes before, only single family stick built. This one dropped in my lap.
Loan: 38K
Double-wide, 1996 Layton, 28x48
Conseco agreed to discount to 25K
Seller has a lot to put it on. I offered 3K (60x120).
Lot had a house before, so all hookups are at the curb.
Needs ~5K in repair. (Carpet, linoleum, window, appliances)
I intend to move this unit and mount it on a crawl.
Similar stick builts go for ~100-120k)
My best estimates are:
25K purchase price
3K for land
5K for repair
5K to move
10-14K for crawl and hook ups.
Total 48-52K, ready to move in. I will also have to pay ~$700 for lot rent until I get the foundation ready.
Please advise on whether this is a good deal or not. Also, any exit strategies would be greatly appreciated. I intend on trying to sell it outright for ~80K.
Thank you in advance.
Mike
Re: First Deal…HELP!! - Posted by lyal
Posted by lyal on January 28, 2002 at 19:10:10:
Mike,
I don’t think you should compare this to stick built homes. This is a whole different animal and would be considered “personal property” as opposed to real property since it’s on a rented lot (and I’m hoping that’s not 700 a month that the seller expects for lot rent).
The majority of the people who actively post here pursue what we call “Lonnie Deals” (after the fellow who perfected a great system and then put it on paper so we all could use his cookie cutter) where you invest from a few hundred to a few thousand bucks and resell it with a healthy markup with financing. Although the yield on this looks good, none of us would risk putting this much money into a single deal. With the transactions we do, if something goes sour we can react or at most “roll with it” and not get hurt too badly. If we can’t sell quickly and need to absorb some holding costs, it hurts but it won’t kill us. In this deal, especially since you haven’t done this previously, if something goes awry, you might be in trouble.
I would at least talk to a few local banks and see if they’d finance a buyer on this for you. If they will, see what kind of buyer they’ll want and how much they’ll lend on the home.
Proceed with caution.
All the best, Lyal
Re: First Deal…HELP!! - Posted by Mich_Mike
Posted by Mich_Mike on January 28, 2002 at 19:39:32:
The lot rent is $350. The mobile is there now. The property that I would move it to is in a subdivision (owned free and clear - that is what I was buying for 3K). Isn’t it true that the mobile would turn into a deeded property if it is mounted on a foundation?
The payment on this mobile was $550/month. The lot rent for the park was $350. I figured that someone that doesn’t mind living in such a home would love to do so for $650 or so (vice the $900 their paying now). Maybe I am off base and should just let the deal slide.
Another question (sorry for being long winded). Couldn’t I just resell the mobile in the park for the 25K and keep the property for 3K? The numbers just seem to make sense. Thank you for your time and advice.
Mike
Re: First Deal…HELP!! - Posted by lyal
Posted by lyal on January 28, 2002 at 21:27:59:
Mike,
Yep the mobile turns into “real property” when you permanently put it on a foundation of some type but would it be “equivilent” to a stick home on the same lot? Don’t know the answer to that and that’s the root of my reservations I guess.
I would sooner see you tie this up where it is (Moving these things is always more expensive than you think it is)with an option contract or something that gives you an out if you can’t make it work.
Buying and selling mobiles is a great business. The only times I’ve gotten myself in trouble is when I break the rules and don’t follow the book.
All the best, Lyal