Information needed on land/mobile deals....Renting - Posted by Steven(SC)

Posted by Dusty on September 16, 2003 at 14:46:59:

I have taken a real estate liscence course. I passed and became a Realtor. You do not learn about real estate that way.

Information needed on land/mobile deals…Renting - Posted by Steven(SC)

Posted by Steven(SC) on September 15, 2003 at 13:07:18:

I would like to purchase a couple of land/mobile deals and rent them out for a while. I was wandering if a license is required to do this seeing as how I would not be selling them.
One deal I am looking at is a 3 bedroom 2 bath single wide
on two lots fenced in with a 2 car carport and storage building. The asking price is $22,000. I was thinking I could get it for around $20,000. And rent it out for about
$450.00 a month I would have my investment back in about
4 years. or should I borrow 15,000 from my bank put up 5,000 of my own money and do more deals.
I am new to real estate investing and am interested in the lonnie type deals but i also like ScottS(NC) ideas about
renting I have never been a landlord so I wouldnt mind giving it a try. I know a lot of people say do not go that route and give tons of horror stories, but I am the type of guy that just has to see for myself. I was in a car wreck this year and broke my right knee and had soft tissue damage to my left knee. I am having arthroscopic surgery monday September 22. Hopefully by the first of the year I will be able to get out there get some deals going.
Any advice would be greatly appreciated.
Thanks Steven(sc)

Re: Information needed land/mobile …Renting - Posted by ScottS(NC)

Posted by ScottS(NC) on September 16, 2003 at 07:24:34:


Congrats on not buying into the false fears of renting. As long as you own the land renting mobiles is an awesome cash machine. Most folks hear stories and use other peoples fears to justify there own. I HIGHLY reccomend you check out Jeffrey Taylors material available at, it is by far the best material on rentals I have found. Let me Know if I can help you. Take Care ScottS(NC)

You’re sure right about needing information. - Posted by Dr. Craig Whisler CA NV

Posted by Dr. Craig Whisler CA NV on September 15, 2003 at 15:14:54:

Hi, Steven, welcome to the wide wacky world of wobbly boxes.

I do land/mobile deals almost exclusively.

The numbers or your 20k/22k deal sound good.

There is one thing that could improve this deal Greatly. That is if you could get some seller financing. The reason is that the added leverage would greatly increase your rate of return. Here is an example of what I mean. If you buy a 100k house for cash and the value increases 10% on a year, you have earned 10k for a 10% return on your invested cash. If you financed this house with 10K Down, when the value increades 10% you would have doubled your invested cash from 10k-20k. That would be a 100% rate of return on the financed house v.s. a 10% rate of return if you paid cash. You earn ten times more money with the financed property.

Try to get some seller financing on the place you are considering. I would rather pay 22k and with 10% down and the seller carries the balance, than to pay 20k all cash. If you pay 22k with 10% down and the property appreciates 10%, you will have made $2,200 on a 2k investment. That is a 110% profit v.s.paying all cash and still getting the same $2,200 but this time having a profit of only 10%. If the property is financed you would get all of your money back in about 2 years with taxes and expenses figured in. If you add in in taxes and expenses with your numbers it might actually be closer to 6 years before you get your money back. 2 years or 6 years, the choice is yours.

Leverage is mostly what real estte investing is all about.

If the seller won’t finance then try to interest a lender in financing it if possible. You need for you money to grow faster in the early years if you want to maximise your growth rate. Later when you have more capital, a slower growth rate percentage-wise is more palatible.

If you want to try landlording then it would be very smart to go to a seminar on managing rental property and read several property management books. If you fail to learn early on how to manage well, each one of the hundreds of mistakes you make will be the equivalent to paying for a seminar, only you will only learn one thing at each of your seminars v.s. hundreds of things that you’ll learn at professional seminars. They will probably cost about the same too.

With proper professional training you can avoid most of the horror stories you have heard.

If you don’t approach property management seriously you will not be very successful and you will likely burn out early and give up. Then you will go around telling everyone you meet, real life horror stories of your own experiences.

Anyone with a lot of horror stories to tell is just admitting that they failed to learn the easy way. They were foolish and studied at the school of hard knocks instead. They are admitting that they are poor managers, and make low profits as a consequence.

I can tell you from first hand experience because I was one of the fools who had to learn the hard way, by trial and error. I paid for many a ‘trial’ before I learned the ‘error’ of my ways. Would you rather spend your time on tennis courts or in trial courts? Evictions usually represent a failure of management. You don’t generally evict tenants because they are bad people, you evict them because you were a bad manager. A good manager knows how to select tenants that won’t require eviction.

I am an old man now with many battle scars, that I would have prefered not to incur. I hope you will listen and really take this advice to heart and avoid the many costly mistakes that I made.

At the risk of being boring and repetive, I will repeat one of my favorite sayings, yet again: A wise man learns from other’s mistakes, and a fool scarcely by his own.

Take a professional seminar on rental property manangment. Take several if you can and read every property management book you can afford. This is an EXTREMELY complicated business. It not hard, but it is complicated. You need know how to do THOUSANDS of little things just right to be successful.

Funny thing, I’ve never met anyone who had No experience as a property manager who didn’t think it was so easy that they could do it well. It just isn’t so.

I susggest that you study at least one property management book BEFORE you buy your first property.

Regards, doc

Re: Information needed land/mobile …Renting - Posted by Rikki

Posted by Rikki on September 17, 2003 at 06:06:23:

Scott, what part of NC are you in? Here in eastern NC (Edgecombe County), there were 3 seperate land home deals within the last 8 months. Bank owned. Minimal work to be done. Well and septic tank included. Lots were about 3/4 acre each. All doublwides, one with brick foundation. One sold for $23,000. The other 2 for $24,900. As soon as I called about any of them they were already “under contract.” Talk about what could have been an opportunity!

Re: Information needed land/mobile …Renting - Posted by Steven(SC)

Posted by Steven(SC) on September 16, 2003 at 09:02:57:

Scott, I have enjoyed reading your posts about buying and renting land home packages and using the lonnie method as a exit strategy. I am 31 years old and am interested in long term investments instead of the 2 or
3 year lonnie deals. I have not worked since my accident back in January and will be having surgery on both my knees next week. Hopefully by the first of the year I will be able to aggressively find land/mobile packages and begin renting soon after. I will study up on landlording to try and minimize any problems. I read in one of your posts that you sometimes come to Seneca(SC). I was raised there even graduated from seneca high school, My Wife and I now live in walhalla
(SC). Thanks for the response and I would like to open the invitation if you would like to email me or discuss your ideas on the land/mobile deals.

Re: You’re sure right about needing information. - Posted by Steven(SC)

Posted by Steven(SC) on September 16, 2003 at 08:46:14:

Thanks for the info Doc… I will definitely study up on the subject of landlording before I take the plunge.
Our local technical college offers a 30 hr real estate management course for $279.00, would this be a good starting point for someone interested in being a landlord? I enjoy reading your posts.

Re: Information needed land/mobile …Renting - Posted by ScottS(NC)

Posted by ScottS(NC) on September 17, 2003 at 07:39:35:


I’m in the Asheville area, That type of deal is my bead and butter here. You gotta find em and tie them up quick. Have a GOOD realestate agent keep his/her eyes open for you. Tell them your specifications and get them to give you the address, tell them you will drive by they don’t need to show it. Saves them time and you can see it on your schedule. I hope you are ready for Isabel she’s weaker but still big. Let me know if I can help. Take Care ScottS(NC)

I may take a lot of flac for saying this but… - Posted by Dr. Craig Whisler CA NV

Posted by Dr. Craig Whisler CA NV on September 16, 2003 at 10:31:54:

…if the real estate management course you speak of is taught by a licensed real estate broker or is sponsored by your state or the real estate sales industry IN ANY WAY, I can say unequivocally and without hesitation that it will likely be TOTALLY worthless and is not recommended, not even if it were free.

I am speaking of training sponsosred by the investor comunnity ONLY.

If you want to learn to be a salesman, then take the course. If you want to learn how to become and investor, then learn from successful investors. Never the twain shall meet.

I have see many such courses sponsosred by the real estate industry, designed to fulfill continuing educations requirements for brokers and they have ALL been totally worlthless.

I know I’m going to have to take a lot of flack from real estate professionals for being honest with you, but it will be worth it if I can save you $270 and a lot of time and steer you in the RIGHT direction.

There MUST be several of the books of the type I mean available in the bookstore of this forum, If not contact John Schaub, Jack Miller, Peter Fortunato, or Jimmy Napier. they are all in Florida and all have websites. Miller is required reading for every new investor in the world, bar none.

As long as I have already stepted in it, I might as well tell you one more thing that won’t endear me to licensed real estte salesmen and brokers. In my entire life (and I am certainly no spring chicken), I have met several thousand real estate brokers/salesmen and done business with probably a couple hundred. I have met only 3 out of that entire number who knew their arses from a hole in the ground, when it comes to knowing anything worthwhile about becomming a successful, creative real estate investor.

All most of them know is how to be a salesman and earn a commission. If they knew how to invest successfullly they wouldn’t have time to work for 3%-6% commisssions, they would all be doing Lonnie deals and making 100%-200% per year on their investments.

Ok real estate professionals, take your best shots, I’ll take everyone of you on, simultaneously and blindfolded.

Oh, by the way, bring your balance sheets with you.

Regards, doc

Re: Information needed land/mobile …Renting - Posted by Rikki

Posted by Rikki on September 17, 2003 at 16:19:46:

Thanks for the reply Scott. Yes, timing is everything. I just found out about them to late I guess. I do have a couple of questions for you though.

  1. Say you found 2 deals like the previously mentioned ones at the same time. How would you purchase them at the same time if you don’t have the cash?
  2. You said these were your bread and butter. Do you strictly rent these, sell just the doublewide and rent the land, or sell the whole package? Rent price around here would be $400-$525/month.
    We’re preparing for Isabel. By 5:00p.m. tomorrow the brunt of it should passing over. Be careful and have fun.

Re: Fl. salesman exam prep course - Posted by Ray Conrad

Posted by Ray Conrad on October 28, 2003 at 11:25:20:

Hi Doc,

I’m moving to St.Pete Fl. area in the spring of 2004. Interested in studying for the Real Estate salesman exam.
I have a backround in residential mortgage finance for many years. As a (no spring chicken) I need a course which I can take from my home in Connecticut which would be recognized in Fl. to prep me for the exam.

Please advise,

All the best,

Ray Conrad