BiggerPockets

I think the biggest problem is that you'd be buying something that is going to go DOWN in value. If you got the place for almost nothing, and if you owned the land (and if you had no other use for the land), and if you could keep it rented to steady reliable tenants. See, too many ifs there to do anything with.

A couple of times I've had Realtors try to interest me in buying small mobile home parks, if you can buy them right they can be CASH COWS. Recently an agent told me that it costs about $15K-$17K per space to develop a small park. So, if you had some land and could put in the sewer/septic fairly cheap it might be something to look at.

The ones that I looked at had a simple deed restriction in the space leases that the owners could not rent out their mobiles, without the land owner's permission, which is never given. So when people decide to move up they find that it's real expensive to get the mobile moved, and the market for used ones is almost non-existent. So the owner of the park buys the trailer for pennies on the dollar, and then THEY CAN RENT IT OUT. Pretty neat huh. The returns on the ones I looked at were pretty good but I just couldn't interest myself in that end of the market.

all cash

I'll check it out Gordo, more out of curiousity than personal interest though. I'm in my mid 50s and don't like the idea of being tied to one geographical area. Also from what I've seen they're more maintenance intensive than stick built houses, and let's face it, they do decline in value. Although there might be some locals, Palm Springs California maybe, where they hold there value.

all cash

Gordo, thanks for the tip. Looks like Lonnie Scruggs is the man when it comes to mobile homes. I'll try and pick up one of his books. Thanks to everyone else for the feedback. I'm also curious about how much of a "cash cow" these parks can be. How long does it take to expect a return?

I think mobile home I think 2 things, low income and retired folks. Both would be likely to run into money problems and may have a tough time paying the rent IMO. Does anyone that currently owns a park have issues with non-payment?

Being unsure where individuals reside, from this board, I can tell you that mobile homes are NOT always for the lower income and the pensioners and are SOMETIMES a really GOOD investment, and here is the other way to look at it. I live in SC in a rural area, and nearly EVERYONE out here with 5 to 500 acres, starts out IN a mobile home. They purchase the land, have the well and septic put on, put a mobile home on it and they pay on it until it is paid off. At which time they either build a house and move the mobile home off, or they build AROUND the mobile home. Demographically speaking, most of these are couples in their low to mid 30s with mid range income, not lower income levels.

In my area, mobile home lots rent out for $300+ per month and almost always the mobile home company finances all of the trailers out on it. And I believe the tenants also pay the taxes. But trailers (not the modular homes, they aren't build on a chasis - if they are put on land they appreciate very well) do decline in value and are typically tied to low-income individuals (even though that definitely is not the standard).

If the park is run well and you find good tenants, you can definitely make a lot of money in the business.

Where are you finding Mobile Homes for 3500$. Are they listed online? Is there an ad in the paper? I 've been looking around RE sites and I only come across mobile homes that people are trying to sell for 30K or more. Please tell me where you can find a MH for less than 5k that isn't about to disentigrate due to rust.

Rbecklan, I have a question re logistics of your deals. Are you buying homes already in a park? If so, do you then pay the pad rental until you can resell?

As noted earlier, check out Lonnie's book Deals on Wheels plus the later books. I have meet the man a few times. Real solid guy. Very experienced.

There are at least two people who have posted to the thread that seem to be doing Lonnie deals.

All housing goes down in value if you view it from the material point of view. Hence even stick built tends to wear out. The land tends to hold its value.

MH are inexpensive because they are easy to replace when they wear out. They also are easy to fix given the style of construction. With a MH you are creating streams of cash and are not looking to make your money from appreciation. If you want appreciation then look to a MH Park. Note a MHP is a commercial property so its value does not just rise with time. It is all based on the cash flow.

MHs let people start with little capital. You can do very well by them. Or you can just go to stick built homes and start there.

The largest MH builder and buyer of notes is Warren Buffett through one of his companies. It can not be all bad if Warren sees value.

John Corey

winn-- those are very real concerns... we've definitely seen that around here.

Seems like the key is to find mobile home parks with hired [i]managers/i] (and absentee owners 8)). Some of our parks here are basically owned by far away corporations and the managers are very agreeable if fairly treated.