THE MOBILE HOME GAME
So you want to buy a mobile home in someone else’s mobile home park, and sell “The Box Only” with owner Financing. I’ve done it hundreds of times! Buyer beware!
You absolutely have to have the park owner agree NOT to charge you if the occupant gets behind or doesn’t pay. You need at least 3 months grace but I’d shoot for 6 months.
Your position is that YOU will advertise and find the new person to rent the lot and that you won’t move the home out of the park under those conditions. The lot your on is one less lot they’ll have to worry about.
Is the park full? …or not so full?
Parks that are full are dangerous to you. Parks that have waiting lists don’t need you. They start upping rent. You need to project (in writing) your lot rent increases way out into the future; 2% per year or whatever.
Beware of parks in areas that can be sold to Mega Malls, or high rise building conglomerates. Your lot lease is most likely month to month. I’ve seen several parks sold because the land under the mobile homes became incredibly valuable. They gave everyone a “30 Day Notice” and sold out.
Can your mobile home be moved? Or is it rocked in or have additions that won’t roll down the road? Patios? Decks?
Have trees grown up and blocked you in?
You don’t make money moving mobile homes.. It’s best to buy them in place and leave them there – forever!
Is the home a Doublewide or a Singlewide? Doubles cost way more to move. You DO NOT want to have to pay to move a single, much less a double.
FYI – In parks, you cannot get double the rent for a doublewide home. You may barely get over what you can collect in rent for a Singlewide…so don’t pay double for a doublewide in a park. They will rent faster, but the ROI is much lower. If your double wide comes with its own land, it can be worth the extra cost for a double vs. a single.
Do you need a license to sell 1 mobile home per year? How many can you sell per year without a mobile home sale license?
I’ve played this game. It’s a completely different game. Unless you have agreements the park owners can have their way with you.
I find hard to fill parks are the ones that will work with you best, but, the minute they get full you’ll see the attitude of the owner change; not in your favor.
Mitch Stephen is author of the book “My Life & 1,000 Houses.“
He specializes in a real estate investing technique called Owner Financing