LT Cash Flow : Renting vs. Owner Financing (mobile in Park)
Hey guys,
What we had originally planned to do was buy-hold-rent mobiles in parks; however it seems near impossible to find parks that allow this. It seems the popular way of avoidance is by technically selling the home w/ seller financing.
My question is- is it worth it to try to find a few parks that will let me rent or should I just take a straight seller financing sale approach?
Example:
Trailer Cost= $5,000
Lot rents here= $500 ish
Reasonable rent for trailer in park= $1,000
Takes 1 year to recoup the trailer investment. Then after 1 year we are just bringing in $500 a month clear.
Time to make $5k Profit= 1 year and 10 months
If we Seller Finance....
Lot rent is $500
Trailer cost= $5,000
Trailer re-sale value= $10,000
So we make $5,000 profit in the deal plus interest
However- if we still price it to where we're bringing in $500 a month from it...The income only lasts for 2 years. Then no more residual income.
Is there a way to make owner financing more profitable?
