I like to know if there anyway, to rehab a mobile home and make a quick profit out the rehab, does that works same as a normal houses,
what aspects do you have to look for before I buy a mobile home and make a profit without holding it
Mobile homes can be all over the map. They are different from stick built in that comps are hard to figure. Lots of folks say they go down in value. But it's eye of the beholder.
I like them because you can do buy and sell without escrow. Caution here though.
You would look at them like a house in regards to repairs. Can you do the needed repairs? Do you want to? Getting one in move in condition would obviously be easier than dropping $5k into rehab and 1 or 2 months of work.
Check out John Fedro on this forum. He has tons of videos on Youtube on all this.
thanks for your advice, I will definitely look at that with careful, even if I think is a good way to make some cash, I will watch all the videos where you mention at and learn as much as I can
Check out Deals on Wheels, by Lonnie Sinclair. However, Dodd Frank has changed some of the techniques he describes.
The biggest issue I see in this realm is weather or not actual Land is involved. I would think you would have to be in a crazy hot market to rehab mobiles on a rented lot and make it worth you headache and money.
However, if it is a well built mid 90's mobile on a half acre of land in Columbus, mt (where i live) it would be worth rehabbing and flipping. These will sell great all fixed up!
I also want to hear what @John Fedro has to say.
Mobile homes with or without If you're buying for cash and so I am terms you going to be really careful, see @John Fedro
Sorry that above meant buying for cash and selling for terms
Hi Ramon and group,
Thanks for including me and I'll be happy to comment my opinion. This response is a my opinion based on experience and I welcome comments.
See my responses below in non-bold.
I like to know if there anyway, to rehab a mobile home and make a quick profit out the rehab, does that works same as a normal houses, By definition I don't see how you can "rehab" a home without rehabbing it. What I think you may have meant is can you buy a used mobile home and sell it for a profit without making any repairs? If this was your intention than the answer is, Yes. The ultimate goal is to always sell your investment mobile home for an attractive price and terms to your end buyer. The home need not be repaired as long as all repairs are disclosed to the buyer and they are happy making the repairs for the price/terms of the sale.
Now that we have that basic understanding lets talk about how an investor can create a value. We can buy a home below value, make repairs, and sell for a profit as the home is now fixed and move in ready. In addition to making the repairs and the improved value of the home realized that simply by finding the home undervalued and negotiating a win-win price with your seller, you have already created a value. My point in the last sentence is that by buying below value you have captured a value (profit) when you purchased, so you can now sell for a bit of an increased price if you find a buyer willing to pay this. There are other ways to create a profit however we won't go into them here. Remember though, your marketing has to be better than the sellers or you have to be more patient than the seller because if they can't sell it then perhaps you may have the same hurdles. Does this make sense?
what aspects do you have to look for before I buy a mobile home and make a profit without holding it. This is a bit more of experience than it is simple black and white features. A park without a lot of other homes for sale is a start. Buyers like 3 bedrooms more than 2 bedrooms, and 2 bedrooms more than 1 bedrooms. Some repairs buyers will consider cosmetic and be fine with in many cases, other repairs most buyers will turn the other way quickly and walk away. I hope this makes sense. If you have further questions don't hesitate to ask us.
What if I own the property, and I want to start filling up this land with mobile homes and rent it out, does this will be a good idea? This sounds like a good idea to continue learning your local codes, prices to install utilities, and much more due diligence to consider. Others here may have more experience that me with regards to creating your own pseudo park than me. Continue asking questions and learning though.
All the best and I hope these thoughts helped some,
Thanks for your detailed thoughts!
First it all, i want to thank everyone who took time to write me back with their professional oppinions, I appreciated. I been involve on the real estate area for so many years, during repairs and fixing houses for others, thats my daily business, but in this area to invest my own my money I am a total novice guy, looking to learn and determined to make it happen. the last comment was very clear and does make a lot of sense, thanks John fedro for clarify many doubts, that gave me deeper understanding to the mobile home investing area, I do like the idea to get in my portfolio as many as I can through getting experience every day
thank you all
@Ramon Contreras - We buy them and flip them all of the time without doing any rehab. The key is finding 1990 and newer mobile homes at good prices and having a list of hungry buyers that need mobile homes in the areas you are looking in. Flipping to retail buyers is NOT the way to go. You want to sell to professional buyers that have the ability to pay cash and move quickly for the right deals. You don't want to be spending a bunch of time showing mobile homes to potential buyers. You should be able to sell them with good information, good pricing and pictures. Always looking to network!
Good to see you back!
To the OP, IMO we have two experts on MHs on BP, Marc and in areas of park or MH operations, Ken Rishell, search their posts!
There are several who may do very well in this market, but several are rather guru oriented and don't convey what can be a legal matter in financing sales or justifying values.
Thinking that buying any asset at a distressed value and making money, claiming instant equity is good guru copy, but isn't the case, it's Enron accounting of overstating equity, depending on who you're talking to, such claims can be illegal and fraudulent, so it's best for new investors to begin understanding conventional valuations, how equity is established and when equity becomes different than your actual costs. Your accountant can inform you of the proper accounting.
John is absolutely right in that finding a great deal is a function that becomes valued, that value is well established by the fees Realtors charge or dealers like Marc may charge, these acceptable fees become your base line to judge the value added. Simply touching a contract won't be a justification for excessive values that may be predatory that has been common in MH dealings.
I'm not sure why Joseph keeps pushing Lonnie Scruggs and Deals on Wheels as that thinking was pretty much one of the reasons federal laws were adopted killing the shams described in that book. I suppose he's trying to sell his book or is just being obnoxious pushing a book that is full of concepts of predatory dealings that are illegal now. When your gurus lack education, formal training in RE, knowledge of valuations and financing, you need to beware.
Pick Marc's brain! If you think of financing sales, you need to get with Ken, he publishes compliance issues for dealers nation wide and is active in the big picture. :)
Bill Gulley, General Real Estate Academy | https://generalrealestateacademy.com
Thanks Bill! I would hate to think that what Lonnie Scruggs was doing in his own personal "Buy Here - Pay Here" mobile business, when he wrote the books, was why the current laws were adopted. Lonnie has passed away, unfortunately. When he was active, long before current policies, he always stressed being fair and, when it came to profit, one of his mottos was "good enough..." I learned a lot from Lonnie over the years from his books and personally.
I think it is a shame that this business model is no longer workable in this climate and, the ones who are missing out the most are the ones that can not afford to pay cash for a mobile home. What's wrong with buying for $3k, spending a little to fix up, advertise and sell at $6k with terms of 10-12% for 5 to 6 yrs? Why and how would that have ever riled up the powers that be to enact the current laws? I understand that you can't operate a buy here pay here mobile home operation without a getting the proper licenses but, I don't think the practice outlined above qualifies as a reason to enact laws that require such. Just my opinion. RIP Lonnie Scruggs!!!
You must be a BiggerPockets member to post on the forums
Join the world's largest, most open Real Estate Investing Community online, 100% free forever!