Questions to ask a mobile home seller - Posted by Eli
Posted by Eli on March 24, 2006 at 13:34:06:
There are a LOT of factors that go into evaluating a park. But from what I am seeing the price is too high. I think you are right in going back and re-negotiating the price but I think it probably needs to come down even more. There are dozens of things that could make this a good deal and dozens more that could slash what it is worth in half.
here are some questions I will need to know:
What is the total Number of Lots in the park? (paying tenants)
Total Number of Vacant Lots?
What is the current average lot rental?
How does the average lot rental compare to other parks in the same market?
How Many of spaces are designated RV spaces?
In years, how old would you say the park is?
Are the streets paved?
If so, do they need repairs?
Does each lot have its own paved driveway?
What is the condition of the grounds/common areas?
Is the park on city water?
Is the park on city/county sewer?
How old are the water/sewer lines?
Does each lot have its own water meter?
Do the tenants pay for the water/sewer service?
What % of electrical boxes have been upgrade to 200 amp service?
Do the tenants pay for the electrical service?
Do the tenants pay for the garbage service?
Are there any mobile homes included with the sale of the park?
How many homes in each age category are there?
SW - 1990’s models
SW - 1980’s models
DW - 2000-Current
DW - 1990’s models
DW - 1980’s models
All homes 1976-80
What is the average age of the mobile homes in the park?
How many park owned homes sit VACANT?
How Many lots are big enough for Doublewides?
What percentage of the spaces could hold a 16X80
Does the park have a separate office on-site?
Is there any undeveloped land that comes with the park?
-If so how many acres?
-what is it worth an acre?
What amenities does the park have?
What is the asking price for the mobile home park?
How did they come up with that price?
Why is the seller selling the property?
Is there a mortgage on the property?
If there is a mortgage, is it assumable?
Will you finance the property?
How much down payment would you want?
What is the Tax Assessed Value?
What is the Actual NOI for last year?
What is the total income from Rental units/mo (hundreds)
Is there any additional income (in hundreds per month)
How far is this from the nearest major airport? (miles)
How far is the park from the nearest Elementry School?
How far is the park from the nearest grocery store?
What would you rate this park on a scale of 1-10?
How many acres of land does the park sit on?
Is there any other structures besides the mobile home park?
- what is the aproximate value of it
List a breakdown of all expenses:
Utilities (water, electric, gas etc.)
Repairs & Maintenance (for park & any equipment)
Contract Work (plumbers, electricians, A/C etc.)
Parts & Materials (for park & equipment)
Telephone (including yellow page ads)
Fees, Licenses, Dues & Miscellaneous
Legal & Accounting fees
Total Expenses (if known skip the above and fill THIS in)
With those answeres a real value can be come up with, (I have some softare to do thousands of calculations on this info disecting it and analysing it in every way imaginable) then I make an offer based on what it is really worth. Then if accepted I look at the property, if it passes a visual test and everything else checks out I move forward.