What to Do with Old, Inherited, Occupied Mobile Homes
Last year, my brother passed away and left my sister and I with a condo (which we're selling) and 3 occupied, single-wide mobile homes in NorCal. He wanted us to take care of his tenants because he said they were hard-working farm workers and reliable people who always paid on time.
It turned out that the homes were pre-'75 and in very bad shape. Two of the tenants pay $500/mo.; the third manages the properties and pays only $350. My brother did some upkeep or had repairs done, and we've spent $4900 in repairs since last June. Should repairs continue at the same rate, we'd clear almost $832/mo.
The property manager--who was so fond of my brother that she cried when she heard he'd died--had my husband over to her home, and he was shocked at how bad a condition it was in. If we could afford it, we'd replace all 3 of them, but there's no way that we could charge them what would be manageable for them. Hence, we don't know how long these mobile homes will even be viable as livable spaces. My sister has offered to sell us her interest in the properties, and that's what my question concerns.
The probate appraiser--who we don't think actually entered the properties--estimated each one at $15k: $10k for the land and $5k for the home. Each is insured for $4k. If they were worth $45k in total, I'd have no problem paying my sister half that. However, she had a RE agent drive by, and the agent estimated the lot at $15-20k and without seeing the interiors, the homes at $5-10k. That estimate adds up to $20-30k/property. My sis would want the high side ($90k), and the possibility of having to spend $45k to buy her half of the interest in such rundown homes--who look to have a short shelf life--has me spooked. I'm leaning toward having an appraiser actually go into each home, but still...these don't appear to be long-term investments. We're 12 hours' away and in the next state, so it's not as though we can do any repairs ourselves.
We own a couple of nice rentals, but they're in SoCal and have SoCal price tags. Not only do we not have experience with this price point, but also we do not have experience with mobile homes. I made a promise to my brother to take care of these folks, and while we need the additional monthly income, I'm not sure what to do about any of this. There is a personality conflict with my sister, so it really is best that we're not in business together.
Looking forward to your advice.