I am looking at a Mobile Home with land (1.5ac) that is in the foreclosed market. It's priced at 37k. I am looking to rent it out a feel it would rent for $400.00 a month. I have never had dealings with a Mobile Home so I would appreciate any pros or cons on this idea.
Hi Joey! It is funny that you posted this because I just received a phone call from someone looking to sell her mobile home and I have no experience in this arena. So I thought... I need to go on BP for input!
The seller stated she just wants it off her hands, it is now vacant. I am located in NY and the property is about 1 hour away from my general area where I typically invest in. She believes the property is worth at least $25,000 and she would like to get $25,000. I have not spoken to her about yet about what I would offer since I have not seen it and just ran the comps. It seems like it is actually only worth $17,000 ( pulled comps) and was purchased in 1998 for $18,000. She stated that the interior does need rehab, everything is original (1970) and the garage door needs to be replaced. She will be sending me pictures of the interior, exterior, and garage.
720 sq ft, 1.5 detached car garage, .5 acres. There is a 1 acre lot down the road that contains a 1 car garage that is selling for 29,000 - that is what she said she is basing her comps on...
I wholesale but I have never been involved with a mobile home transaction. But if there is a little money to be made in this deal, I cannot pass it up! The mobile home is located not too close to anything, mostly just farm lands. So I am not too sure if it is a desirable area.
I would LOVE to hear from other investors that wholesale, rehab, and/or rent mobile homes. Pros / cons and how to make it work if possible!
Thank you in advance for your insight. :)
Is it a double wide or single, and what year was it manufactured? Either way, $37k is over priced for something that would only yield a $400/month rent.
I have two doublewides and two singlewides currently. They are all on apprx half acre lots. I have $5k in one early 80s singlewide (it came on 10 acres I use for sheep pasture) that rents for $650. I have $37k and $34k in the two doubles and they rent for $950 and $850 (very nice ones). The other singlewide I just purchased for $20k on the half acre lot and expect to rent it for $550-$650 (nice large MH on a double lot but in a neighborhood with way too many singlewides with mostly renters). My parents have three DWs on 1-3 acres of land that rent for $850-$1100 they have $25k-35k in them because they were HUDs from the end of the cheap times a few years ago.
If you are referring to the 4/2 that was just recently listed by DeHildren Realty, I think you could get at least $600. I'm just guessing since I am not in your market though. Give the agent a call and see what they think.
Insurance rates are usually higher
$600 sounds much better than $400! Better check out what this will actually rent for.
I know it's been a month since the initial dialogue however I thought it would be good to reply for others that come across this post seeking additional feedback/advice. When I'm analyzing a specific market area in order to determine rent or payment for purchase for my mobile homes, I use "rental rate" for that particular area. I would recommend contacting a few apartment complexes in the area to get an idea of the leasing rate and then contact a few mobile home parks in the area and find out the cost of lot rent. So, if for example the avg 3/2 apartment is $1,100 and lot rent avg $400 then you can expect to rent your property for $600-700 per month.
I think @Shevaughn Rawlins is right on with getting the rental rates. That's the same strategy I use currently. I've picked up two homes in parks and I'm getting a feel for how to handle homes on land. A small city less than an hour of me bought out the little 12 lot park and I'm hoping to get some of these off their hands. Many are abandoned and in bad shape and the park will be converted into buildable land by next year. If I can find the land I can possibly move these homes there.
I think you could certainly get more than $400/month on that deal ESPECIALLY if you do a lease/option seller finance deal in the end.