Mobile homes on Land (long) - Posted by Skip

Posted by Finance Guy on June 02, 2006 at 15:48:03:

Skip:

The MHP would have a good infastructure, location and a need for affordable housing. It would have a high vacancy rate 30-50% and a older owner who whould want out. You would hire a manager and fill vacancies using either repos or factory direct new homes and sell on contract. This process would increase your occupancy with higher quality tenant/owners and with new management to keep things in order. Buy low, sell high. Lots of these parks out there you just have to work at it. I understand about your 200K yr sales job but if you want freedom then you have to be uncomfortable for a while so you can be free for the rest of your life. Then again maybe you need to find someone to partner with and have them do all the grunt work and share 50% of the profits with them. Just a thought.

DW

Mobile homes on Land (long) - Posted by Skip

Posted by Skip on May 31, 2006 at 13:41:37:

I would like to purchase a lot and place a good used
mobile home on the lot. I have several 100K in cd’s
and money market accounts which I would use to carry
the contracts. I do realize I could probably get
a higher rate of return doing Lonnie deals in a mobile
home park, however it is to short term for what I am
looking for. (Besides I have to kiss a-- in my well
paying outside sales job (make 200K+ per yr)not willing
to kiss a-- to a primadonna park manager). Not
interested in the donut route at this time (I learned
never say never)

Can anyone please give me some real deals that you have
done with mobile homes on land, total cost and final
sales price and if you did any owner financing?

Would it be wise to just purchase a repo mobile
home on land and resell on contract instead of
developing and moving a mobile home on a lot?

My fantasy goal after the effort and hard work to
show a 20% return on say 300k, or $5,000 per month
hopefully with long term buyers.

It appears the housing bubble is starting to burst.
I feel mobile home lots prices should start to be
reduced, probably big time in 2008. Are your seeing
this in your area?

If you could pick an area in the sun belt states,
for mobile homes on land investment where would you
choose and why?

If you read this far and did not go to another post
thanks for reading, please offer your opinion.

Skip

Re: Mobile homes on Land (long) - Posted by Finance Guy

Posted by Finance Guy on June 01, 2006 at 22:22:59:

Skip:

If your flush with a couple hundred in CD’s you might want to consider a MHP purchase. Leverage you 200K into a Million Dollar MHP. Your NOI should be $120K -$80K for debt service would leave $40K per yr positive cash flow. Hold five years sell for 1.75 mil and make $750K + your $40K per yr X 5 = $200K
Just a thought.

To your success,

Don Wilson (OK)

Re: Mobile homes on Land (long) - Posted by Anne_ND

Posted by Anne_ND on May 31, 2006 at 16:54:43:

Skip,

Depending on where you live, the fact (or fiction) that “the housing bubble is starting to burst” could well be irrelevant to your market.

I’ve done two land/home deals in the upper midwest. One was 5 acres with a crappy singlewide- I paid $12,900 for it (additional costs for land improvements about $2500), gave away the MH to a couple who were willing to rehab it, who now pay me $350/month to rent the land. This is the classic Lonnie version of the land/home deal, not the more labor-intensive Tony/Scott version, you can find out the difference by going to the bootcamp.

My second land/home deal was 7.5 acres with a 5-bedroom farmhouse, 7 outbuildings that we bought for $24,000. We divided the lot and will be putting a newer DW repo on the second lot- this will be a Tony/Scott land/home deal. We have the farmhouse rented out for $450.

Both of these deals were bought severely under market value- the farm’s ARV (repairs cost about $20K) is about $100K, the 5-acre lot is worth about $22K.

Find out what the demand is for housing on land, and what it will rent for. That’ll be your competition. Also find out what the minimum lot size is for a MH- where I was working it was a 2.5 acre minimum.

As for an area to invest in the sunbelt, Greg Meade, a very sharp guy in FL, says GA is a crazy-mad place for MH investing. I’m hoping he’s right. I’ve never seen a place so full of MHs as Asheville NC, it’s like a fairy-land for MH investors, especially small parks and land/home deals.

I second Tye’s suggestion that you go to the bootcamp in Asheville. It was very helpful to me. If you’re willing to do some deals from a distance you might even find a deal or two while you’re there.

Annd

PS- I have no problem with a housing bubble- lots of money will be made when it happens, more than in the past 3-5 years I predict.

Re: Mobile homes on Land (long) - Posted by Sailor

Posted by Sailor on May 31, 2006 at 15:18:58:

Sorry to sound like a broken record, but all this info w/be presented @ Boot Camp. That’s the place you’ll get all the scoop on land/home, as well as other, mh deals.

Tye

Re: Mobile homes on Land (long) - Posted by Sailor

Posted by Sailor on May 31, 2006 at 14:43:17:

Sorry to sound like a broken record, but all this info w/be presented @ Boot Camp. That’s the place you’ll get all the scoop on land/home, as well as other, mh deals.

Tye

Re: Mobile homes on Land Finance Guy - Posted by Skip

Posted by Skip on June 02, 2006 at 12:49:37:

Don,
Thanks for your advice. Just curious as to why
you feel a 1 million dollar mobile home park would
sell for 1.75 mil after five years? Since the
value of the park is based on the space rent it
seems to me the rents would have to increase 75%
in those five years to raise the worth of the
mobile home park. Also I would have to run the
park thus loosing my day job, which would result
in less yearly income.

Maybe what I am looking for does not exist.

Skip