Re: Getting Stuck with lot rent? - Posted by Ruben (KCKS)
Posted by Ruben (KCKS) on April 21, 2007 at 22:53:46:
Free lot rent is very nice but if you can not get it just factor in the cost of the lot rent into your purchase price. Here is what I mean.
Your plan is to have no more than $4,000.00 in a home. One park offers you free lot rent and the home does not need any rehab so you can buy the home for $4,000.00.
Now in another park the lot rent is $300.00 a month. You can not get any lot rent free so if that same home was in that park you need to buy the home for $3,100.00 which is your max price of $4,000.00 minus 3 month of lot rent at $300.00.
My first park gave me 6 months free lot rent and was a nightmare to work in. My current pet park has only given me 1 month of free lot rent on 1 home and I have purchased 11 homes in that park. While I would really like free lot rent and am working towards that I still only buy homes that meet my number by backing into that number using all of my estimated costs for purchase, hold and rehab.
If you have not read Lonnie’s books at least 2 times I suggest you do so and this all will become much clearer for you.