Mobile Homes

The Top 4 Financial Mistakes Mobile Home Investors Make

Expertise: Personal Development, Real Estate Investing Basics, Business Management, Mobile Homes, Real Estate News & Commentary, Landlording & Rental Properties, Mortgages & Creative Financing, Real Estate Marketing
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This article is designed for the active or soon-to-be active mobile home investors buying and selling used mobile homes to create value in their local areas. If this type of investor describes you, then this is a must read article. The article below contains the top 4 mistakes investors make based on personal experience in helping frustrated mobile home investors and working with investors around the country. Don’t let these same mistakes happen to you.

The Top 4 Financial Mistakes Mobile Home Investors Make

1. Overpaying

Do you always know what prices to offer for every mobile home? You should. There is a specific formula for making sure that you always pay the appropriate price (not paying higher than you have to at the time) in order to recoup all your investment capital back within a short period of time while still making the seller happy and agreeing to your win-win purchase offer(s).

Part Math & Part Art: The formula for your 1.) all-cash price and 2.) payment/balloon purchase offer(s) comes from:

  • Knowing your market and what buyers are paying for mobile homes locally
  • Understanding current repairs needed before you resell
  • Knowing your market in different months of the year
  • Understanding and approving the subject home, community, area, and neighborhood all meet your purchasing criteria
  • Knowing what the seller(s) needs/wants and giving it to them

Armed with this data, you and your company can now formulate, craft, and present your three to four valid win-win purchase offers for every seller and home you walk through.


2. Over-Improving

Over-repairing and over-upgrading a mobile home is a common mistake made by eager and well-meaning manufactured home flippers. A general rule of thumb is to bring the home up to neighborhood standards.

Related: 5 Common Mistakes Mobile Home Sellers Make

Cosmetic Repairs

There are certain less important “repairs” that many buyers will accept not being completed. These “not as important” repairs are basic cosmetic clean up, painting, minor carpet replacement, and other light to moderate cosmetic damages. For a fast sale, you can typically sell a “cosmetically-challenged” mobile home to a happy and low-risk buyer for a discounted price and/or terms.

Structural Repairs

Some repairs that will send most buyers running for the hills are moderate and major structural leaks and repairs being needed at the time of resale. Understanding what repairs your buyers are happily willing to make and which repairs buyers almost never feel comfortable making will make your career much easier throughout every deal.

Before purchasing any mobile home needing a considerable amount of rehab, stop and think.

  1. Are there other homes and sellers locally that may be a better, easier, and more profitable next deal?
  2. Is this your first deal? If yes, then aim for the path of least resistance and search for a mobile home needing only cosmetic repairs and clean up to begin with. Make your first few deals ones that will set the bar for the coming years.

Pro Tip: Try not to upgrade. Fix what is broken.

3. Leaving Thousands of Dollars on the Closing Table When Reselling

"John, you know pigs get fat while hogs [in this business]get slaughtered" is a quote my recently deceased mentor once told me. Don't be a hog!

While we mobile home investors should want to be able to sell our investment mobile homes at a retail price, we never want to take advantage of payment-buyers, ever. Every deal should be win-win-win between your seller, buyer, and you.

Know what local buyers will pay and aim for the higher end of this spectrum while still making your buyer very happy at the affordable price and monthly terms of home ownership. A licensed loan originator and closing attorney can help with seller financing paperwork and getting your buyer(s) approved to repay.

4. Putting a High-Risk Buyer or Renter in Your Property

Prescreen, prescreen, prescreen all your prospective tenant-buyers or renters. You would not let some stranger have the keys to your car, would you? Then why let someone in your investment mobile home without knowing them backwards and forwards? As investors, we can only judge our payment-buyers and renters from their past history, not from their future promises.

Related: The 6 Types of Mobile Home Buyers Investors Compete Against

In the past, I have been fooled and taken advantage of many times by deadbeat tenant-buyers and renters who moved in and caused me a great deal of worry and headache. These mistakes were all mine, and there is nobody else to blame. In reality, these tenant-buyers and renters should never have been allowed into the home in the first place. I was too new to see the BIG and little red-flags staring me dead in the face.

Pro Tip: Remember, it is better to have an empty mobile home instead of a risky payment-buyer in the property not paying.

If you are selling your property for an all-cash payment, the only qualification you need concern yourself with in the park approval process for your buyer and/or any bank financing the buyer is aiming to obtain.



Although this post touches on many of the mistakes investors can make while investing in manufactured homes, this type of affordable housing is quite forgiving to an extent. A healthy cash flow can be figured into each property once resold, and even if your profit is less than what you expected, you should have ample wiggle room between your purchase price and selling price to compensate a few learning bumps and lessons. Now get other there and help local buyers and sellers.

“If you help enough people get what they want, you will get what you want.” — Zig Ziglar

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Investors: What would you add to this list?

Let me know with a comment!

Investing since 2002, John started in real estate accidentally with a four-bedroom mobile home inside of a pre-existing mobile home park. Over the next 11 months, John added 10 more mobile homes to...
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    Curt Smith Rental Property Investor from Clarkston, GA
    Replied about 4 years ago
    HI John, another great MH article!. Price: I think its hard for new folks to determine what a single wide in a park would sell for since every seller asks way more than they’d take. This one I feel new people need to hear from others what a 1980’s single wide 2/1 in average shape should sell for. In the SE $3k would be my the price I’d expect to pay. Yup that’s it. Yet sellers will advertise for $12k or more. Offer $2k and just pause. But I don’t recommend park MHs for new folks since there’s so many problems in this Lonnie deals model today. Search on lonnie deals in the BP mobile homes forum. Fixing: We own 20 double wides on their own land and we just repair, we NEVER upgrade. Well we do upgrade light fixtures to home depot quality and fans that where not in the home when we bought it. We leave the plastic hall bath fixtures and put in a cheaper side sprayer kitchen faucet and cheapest but black appliances as “the upgrade”. Then we rent to own and seller finance. We never rent even double wides on their own land. Screening: this is the biggest problem and challenge for a new landlord. And where they will loose money!!! This is where you make or loose money in any rental class, but ESPECIALLY in mobile homes. We are caring and likeable landlords that want the best for our tenants. We know its a 2 way street and we do our part to help launch a successful tenant with a nice home, a path to ownership and me being responsive to fix it needs. But even my honed criteria has failed a few times and we’ve lost a lot of $$ and had to evict. The following are the distilations of a few years of landlording over mobile homes. – have written qualifications and to make it simple put them at the bottom of every for rent ad. – Must have good jobs, take home 3x the rent or $NNN. I call to verify. – must have a bank account with the move in amount today. – good references from your current and previous landlord – No prior evictions or charge offs in your credit report. I don’t care about fico, but do care about credit cards or auto loans that went into collections. I use for my eviction/credit check. Its a pain to setup. Tips: you will be shocked at how few applicants have bank accounts or savings. Someone with good jobs, verified take home >3x the rent AND a bankaccount has a likelihood of being a stable renter. You WILL be forced to take renters into MHs without bankaccounts. This is just a fact, but you need to double check their jobs and cash savings and their story as to why they are leaving their current place and why they want your place. Things to never do: – Never accept a renter in week 4 of the month for move in on the 1st. NEVER do this. They are squeeking out of an eviction situation or at the least they are poor planners. These folks rarely work out and they will leave in the miiddle of the night on you. – Never take large lump sums up front for no rent payments for a few months. You will never see another nickel from these folks. Take large deposits but call it security deposits and they must pay rent every month to keep them managing their monthly cash. – Always drive by their current place. Look for beer cans strewn about. This is funny. I’d not worry much about tenants who drink beer from glass. The problem tenants gravitate toward 24oz bud light and A LOT of them. 🙂 You’ll not get regular rent from the 24oz beer drinkers! Look into their vehicle as you walk them out to their car. It must be clean. Full of trash that’;s how your rental will end up looking. – Be firm with when you file eviction. We’ve failed this one on 2 renters and we ended up loosing a lot of money to their excuse making. You have to be extremely firm: rent is late by the 5th, and litterally you have to file for eviction by the 11th. Look for “private servicers” who will door knock the next day after filing. You can’t afford to wait 2 weeks for the sherrif to serve your eviction. Let them stay if they make up arrears AND the eviction filing cost. Put them out quickly is the simplest advice I can offer. Tip: what has worked well for me is asking: “why do you want to rent this place?” I’m looking for: my dad lives a mile away, I want to stay in the same school system. You get the picture, “stickiness” helps make for a successful renter. I always pick tenants who aren’t commuting long distance to live in my places. That never works out for long.
    Replied about 4 years ago
    “cheapest but black appliances as “the upgrade”.” Well, maybe not black, but white appliances. I also favor the cheapest model of the good quality brands, like Kenmore. If cheapest is the only criteria, you may be replacing appliances too often.
    Andrew K. Rental Property Investor from San Antonio, TX
    Replied over 3 years ago
    Curt, Your comment to John’s article really resonated with me. I literally just received a lead from a lady that has two MHs to get rid of. The lady offered the first MH, a 2/1 in a park, to me for FREE since it has some damage from a recent storm (I don’t know the extent yet). The second MH is also in a (different) park and is a 2/2. She wants $7500 but said she’d accept $5000. I’m going to pursue both MHs, as I’m eager to learn this business. I’ll likely offer $2000 on the MH she has for sale, as she expressed that they’re moving soon and desperate to sell. Not knowing how to accurately value a MH has me at a disadvantage, so the low-ball price is my way of mitigating risk. Unfortunately the lead came via email, so I haven’t been able to speak with the seller to get more details on each MH’s condition. I’ll report back if I get one or both of these MHs! Thanks again to you and John! -Andrew
    Curt Smith Rental Property Investor from Clarkston, GA
    Replied over 3 years ago
    Hi Andrew, you need to read the posts in the mobile home forum about this deal type, fast!! True John and others have made a business buying homes in parks. Reading in the mobile home forum you’ll learn that you first MUST contact the park managers and spend a lot of time just chatting about their letting investors own homes in their parks (or NOT). The park manager can shut down your business even some months after they said ok, and now you own homes in their park. Things do change… Which is why I skipped over buying homes in parks and buy double wides on their own land and like John, the whole park. But you’ll learn a lot FAST about screen renters for just a small tuition. LOL So if the park manager says ok, then experiment for sure with this deal type. No cheaper REI education that I know of. 🙂