This is my first post although I’m on the edge of about three years in to bigger pockets and all things rental. I have a property I inherited. The property is 17 total acres. On the 17 acres there are four lots set up (formerly had mobile homes on them that were rented out). The homes have been long sold by family, the last one being there about 5 years ago. I own the property free and clear and right now have two of the lots leased out to mobile homes. I own the land, not the homes they are leasing the lot. The land is in a prime location. I’m considering building out new construction rentals. Semi locally, in a worse location, I know of someone that has built around ten 2 bed 1 bath homes that were rented before they finished the build and have been since. The math breaks down to 58k turn key, rented at 750 a month. I believe I can build one on a heloc and roll that in to a mortgage and start over on number two and go from there.
I’m curious what questions y’all have that I haven’t thought to ask. Or maybe advice I need. Please ask any and all questions and give me your thoughts. Bigger pockets is a great thing and I’m excited to be a part. I look forward to learning even more.
Sounds like a good strategy to me. Build, Rent, Refinance, and Roll (one less R without the rehab). Depending on the location, I would consider 3 bedroom homes as the demand might be higher leading to higher rent as well.
Here are a few questions for clarification: how many square feet per home? would each need its own well and septic (if so, is that included in the cost)? what are you getting for leasing the lots? is there a higher ROI on the homes after factoring future repairs and capex (I have heard leasing mobile home lots is low maintenance with a good cash flow).
Update. I’ve been pretty inactive on BP since my post but I haven’t quit working. I now have four land lots leased out to mobile homes. I’m pulling a modest 200 from each lot for a total of 800 a month free cash flow with zero maintenance. New question, I’m looking to expand and revisiting the new build option. Basically my plan is to use the leased lots as a credit line to build new rentals with my cash flow covering interest. I should be able to roll that credit line into a mortgage putting my credit line back to zero to start on the next one. If anybody has an opportunity to grab land lots that you think you can lease out I would jump all over it. At this point I basically have an internal lending option that’s covering itself while cash flowing. Are there any hiccups in rolling the credit line to a mortgage on the house that anybody knows of? I know as long as it appraised for more than the build expense I should be good.