Should I buy MH #2 before selling MH #1? - Posted by Blane (MI)

Real Estate Investing
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Posted by Blane (MI) on February 29, 2000 at 09:00:40:

Thanks for responding. My risk tolerance at this point is “high.” Having multiple homes will not be a problem. My wife is not so sure, but after discussing MH #2 last night she was the one that said do it. At this point having 2 MH’s would have no impact on our finances. However, that would change if we still had both more than 30-60 days. This should be enough motivation to get the sell side in high gear.

Per my post above to Karl I know I’m still on the learning curve as far as negotiating, selling, marketing etc. but I thought if I waited until I knew everything, I’d never get started. Instead, doing the proverbial “ready, fire, aim.” Am hoping things will break out with spring coming.

Thanks for the title and other advice.

Blane Swenson

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Should I buy MH #2 before selling MH #1? - Posted by Blane (MI)

Posted by Blane (MI) on February 28, 2000 at 21:54:33:

As some of you know from the convention, I bought my first MH a couple weeks ago. For whatever reason, it hasn’t sold yet. Called a guy back tonight about their home I saw a few weeks ago. Has an immaculate 1975 14x70 2BR he’s itching to get out of 'cause they’re ready to buy a house, but have to sell the MH before lender will give them the loan. He’s had lookers, but no cash. He owes $9,200, but will sell to me for $4,500 and pay the rest of the loan off himself just to get rid of the home and lot rent. Unfortunately, can’t get him to leave washer/dryer (was gift from mommy-in-law, some sentimental value there maybe). Park manager’s boss gave me green light to work in the park (and 5 other ones of theirs too).

Because the first hasn’t sold, wasn’t sure if I should dive into another one yet, whether it’s this one or another one. I believe I have a good idea what I can sell it for, but still have that nagging “what if you’re wrong?” feeling. Am not getting emotional about the deal, just trying to put the business in high gear, esp. after the convention. Plus the wifey is a little concerned that so far the $$ gone out ain’t brought any in.

MH #2 is mine if I want it. Whatcha think folks?

Thanks in advance,

Blane

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my take… - Posted by David S

Posted by David S on March 03, 2000 at 08:48:43:

NEVER shut down your buying machine. Once you lose momentum, it’s hard to get it back.

Try changing your ads if you are having problems selling. “Handyman Special”, “Kick ME, I’m DOWN”,
“Steal My Mobile Home”, etc… creative ads, small classifieds in the penny saver type papers, work wonders.

My favorite buying ad: “INSTANT CASH for MOBILE HOMES,” regardless of condition, call Joe xxx-xxxx… then don’t be afraid to make several offers, including seller financing or L/O to you. And remember, if it’s a REAL deal, you can always find the money.

David S

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Re: Should I buy MH #2 before selling MH #1? - Posted by Karl (Ohio)

Posted by Karl (Ohio) on February 29, 2000 at 24:05:19:

When I woke up this morning, the first thing I did was jump out of bed and call in sick to work. (It’s called sick and tired leave). There was NO way I was going to go sit at a desk today after that incredible weekend in Atlanta.

Right after I coughed a few times for my boss on the phone and hung up, I got a call from one park manager (my newest best friend) who had a guy standing there in his office wanting a cheap used mobile home. By the time I drove out there, the guy’s park application had been approved. I own three homes there, an '86 that needs major rehab (I was started to regret buying that one), a '77 in really nice shape, and a smaller '71 in okay shape. After showing him all three, I asked “which one do you want?” He decided he wants the '86 because he thinks he’s a real handyman, and because its newer than the other two, it looked to him like the best deal out of the three. (I can’t believe what he agreed to pay for it!)

If I would have had just one home to show him, his choice would have been to either buy it or keep looking. By having several homes for him to look at, that changed his decision to “which one of these do I want to buy”, so he picked one. I decided I’m going to try to always have three or four or five homes for sale in that park, so my buyers have some choices.

When I started doing Lonnie deals last month, I never imagined I’d have as much “inventory” as I suddenly seem to have, but I just kept finding really great buys (or should I say they found me). If I would have bought that very first one last month and waited until it sold before buying the second one…huh, come to think of it, my first one hasn’t even sold yet! But I’m not too concerned, because a bunch of other ones have.

I don’t want to give risky advice to anyone, but buying two homes doesn’t sound like a big deal, especially if you say you want to get into high gear. $4500 for a '75 sounds kind of high, but I don’t know your market. Why don’t you call some folks off your buyer’s list, and see if you can’t have it sold before you buy it? Or go look at the five other parks until you find an absolute bargain that you’d be crazy to pass up. (Dirk, what was your yield on that one you bought for $50, about a gazillion percent?) Hope this helps.

Karl Kleiner

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Re: Should I buy MH #2 before selling MH #1? - Posted by stampeding

Posted by stampeding on February 28, 2000 at 22:12:23:

Tough call here because each person is different.

Some factors are:

  1. Your risk tolerance level. How comfortable do you and your wife feel?

  2. Your financial situation. Can you afford the second mh without much impact on your daily needs? Can you afford paying lot rent on two mhs - assuming they are not sold by the time the rent is due?

As for me, I’d learn as much as I can before moving on to the next one. Negotiation skills, effective advertisement, and other minute details are important knowledge that make it much easier and more effective, not to mention more peace of mind, for the second mh. But, then again, I’m not much of a guy for risk.

Plus, there is always a good deal around the corner.

Just one note on this potential second mh: make sure the loan is paid off and the lien on the title is signed off before closing.