Newbies Unite! possible Lonnie deal... - Posted by Duane


#1

Posted by Matt B on October 29, 1998 at 05:20:54:

Duane,
Congratulations on getting out there and starting the process towards doing Lonnie deals. I know how difficult it can be to just get started. It really looks like you’ve been doing your homework, too. If this is to be your first deal, I think you may want to pass on it, though. This is just my opinion and I have only completed one mobile home deal so far. The problem seems to be that there will be entirely too much involved in turning this into a profitable situation, especially for a first deal. I don’t mean to discourage you, especially since it sounds like you’ve already put effort into researching costs. However, where would this mobile be transported to? Your own property? Or will this possibly turn into a situation that you will be paying lot rent during the fix-up period and while you are showing it to possible buyers? I think that for a newbie, there are plenty more opportunities that will allow you to turn a quicker profit with a LOT less time and repair work. I am not saying you should abandon this completely if you think you can get it to work, just consider that you will have to put it somewhere and be responsible for it until it sells. Your figure of $8,500 seems a little high to me also, for that mobile. I am not saying that it can’t be done, but my first mobile that I bought was a 1971 14X70 in decent shape for $700, and sold for $4,000. It also had to be moved, but I had a buyer with their own land to put it on, so they paid for that. I am looking at another mobile in excellent shape, '74 14X70 that a motivated seller will take $500 for. I have 2 buyers that are looking at it this weekend with my asking price of $5,000.
You can by no means go simply by my advice. I merely want to make sure that you are thinking of all the possible things that need to be taken into consideration. I think there are too many easier opportunities out there for someone with limited experience than to take on the task of doing all that you propose. If you do decide to pursue it, let us know how it went. Good luck on your first deal, I hope it is as fun as mine was!


#2

Newbies Unite! possible Lonnie deal… - Posted by Duane

Posted by Duane on October 28, 1998 at 19:42:38:

Actually, I’m hoping some of the experienced folks will chime in, but, I think we could all benefit from reading each others trials and errors.

Lonnie typically says stay away from moving a m.h. because of the extra cost, but check this out…

1970 something 3 br/1 ba 14x70 sitting in a storage lot, asking $1000, it has been there since January, (I have been watching it since about April). I originally spoke with the owner who was paying $75/mo to store it. He gave it to the storage lot owner to pay off the storage fee. So the lot owner is now asking $1000 for it. I am estimating…

Purchase at $500.00

Transportation $1,200.00

Repair $2,055.50 (this includes; carpet, paneling, a few ceiling panels, linoleum, interior/exterior paint etc. basically, the whole thing needs to be redone)

Total Expense $3,780.50

…try for 100% return plus $1000 (finance fee) equates to a suggested retail price of approx. $8500

This seems worth it (eventhough there is a LOT of work to do). What do you all think?