Investor · Greenville, SC · Member since 2013 · 252 posts · 92 votes
Hey Everybody,
Up to this point my real estate investing has been mostly buying, rehabbing, and selling for profit. I have kicked around the idea of buying individual mobile homes on their own land and using them as rentals. I am not interested in a trailer park, but individual homes. In my area you can get a bank owned double wide 2000 or newer on 3/4 acre lot in decent area for 25k pretty often. I figured with some improvements and appliances that I would have on avg 30-32k invested, and the 3-4 br models rent out for 650-850 depending on size, etc. Taxes and insurance are cheap too. I do realize that the mobile home loses value, but the rental income it would be able to pay for itself in 4-5 years. Any thoughts on this? I don't want headache tenants (no landlord would), and I was hoping that if I bought a nicer unit in a decent area, that I could find better tenants, and ofcourse charge a higher rent. Thanks in advance for your input.
Investor · Columbus, MT · Member since 2013 · 1k+ posts · 1k+ votes
11y
I do own a 89 3/2 double wide on its own land. It has been the BEST rental we have to date. Wa also own duplex from the 40s and a duplex from the 30s. And matnence and repairs have been much simpler and cheaper in the mobile... If I had newer duplexes it might be a different story.
We paid 6,000 for the mobile, moved it onto our vacant lot next to the duplex and paid to have all utilities hooked up. Total investment was $17,800. Just had a CMA done on it it it came out at $62,500. It rents for $775 a month.
Will this mobile lose value over the years? Sure, but it has a long way to go before I lose money... In fact I with rental income I won't lose money. I will have all my money back that in invested in 14 more months. Don't let people discourage you just because it's a "mobile home". These CAN be good investments... Not always
Rental Property Investor · Clarkston, GA · Member since 2012 · 2k+ posts · 1k+ votes
11y
To negate the low quality renter problem for our doublewides on land we only do rent to own for 12 months then seller finance into a mortgage. We get above market rent and selling price and way above average quality renter/buyer. Our cap rates run between 25% and 30%.
Called around to local closing Attorneys for LMLO to use for the note origination. We find it easy to meet our 43% DTI. Seems that our applicants have shunned credit card debt and a car payment and our rent is about all debt payments they have in the DTI equation. Also we hold title in our personal names and only do 3 per year per person (my wife and I). I won;'t get into the mirade of Dodd Frank details here. It's all over BP in other discussions.
... rumor has it that MH park owners can no longer not allow sub-leasing. Anyone know anything about this? Hmm, maybe a good question to ask on this forum.
I hadn't heard this... Does anyone know if this is true, especially in California?
EDIT: Never mind... Found a separate thread discussing this.
Developer · Garland, TX · Member since 2008 · 8k+ posts · 4k+ votes
11y
I've got several MH's on land, down from 15+ a few years ago. My rents are $875-$1425/mo. Each are on one or more acres. My rents are up $225/mo or more over the past several years. When I rehab them I make them more permanent with steel skirting and roofing, for example. They have been stellar for cash flow.
Real Estate Investor · Leucadia, CA · Member since 2014 · 75 posts · 18 votes
11y
Jon Klaus That's a great model for Texas but the entry level (price point) for MH's on land in Cali makes things a lot more interesting not to mention challenging.
Real Estate Investor · Leucadia, CA · Member since 2014 · 75 posts · 18 votes
11y
Curt Smith, I tend to stay away with seller financing in Cali. Additionally, I've been hearing the drums beating in the distance about some of these creative financing solutions so I remain somewhat skeptical at this point.
Is the "Deals on Wheels" book still relevant information?
Conceptually, yes. Technically and legally, it's largely out of date. Still worth reading in my opinion, as long as you know the seller financing landscape is completely different now from a regulatory perspective.
Is the "Deals on Wheels" book still relevant information?
Conceptually, yes. Technically and legally, it's largely out of date. Still worth reading in my opinion, as long as you know the seller financing landscape is completely different now from a regulatory perspective.
Thanks for the response Jon. I asked because i just purchased the book and am reading the deals that where made. I am brand new to real estate investing and want to start my niche in the manufactured homes. I have a few questions, but i will make another post so that i don't change the topic of this post.
Residential Real Estate Agent · Groveland, FL · Member since 2012 · 504 posts · 395 votes
11y
I buy mobile homes on land, all the time, for my investors. Occasionally, I will hold one myself. I think they are great investments. The cash on cash return to my investors is consistently high, and the equity spread is good. To sell, I always recommend seller financing, from a Land Trust.
I also recommend "Invest in Debt", Jimmy Napier. Everyone should have this book.
Investor · Newport Beach, CA · Member since 2017 · 16 posts · 38 votes
9y
MH Park owner here. Been in the business for 25+ years.
1) If your buying private land with a mobile home make sure you can "legally affix" the home to the land or else you will lose out on depreciation and the improved value the legal attachment of the home to the land can bring.
2) "I don't want headache tenants". No one in the rental real estate world does. We do all we can to mitigate it, but, you're going to get them eventually. Just be prepared.
Keller, TX · Member since 2017 · 57 posts · 18 votes
9y
Bill Neves I have been searching and asking HOW to get the paperwork to rent to own MH and this is the first post that has more detail.
I've passed on 2 good local deals I found because I need this information. Does an attorney draw this up? I've seen something about RMLO? I'm in Texas. Just a direction to head toward is all I'm seeking. And what is REIA? is it real estate investment associate?
Thank you