I'm looking at a deal and trying to determine what to do. Here are the details. Should I be looking at the figures as two separate deals? The mobile home park and the apartment building?
~4 Acres approved for 16 mobile homes. 4 Mobile homes existing, 3/4 are in disrepair. Also included in the sale is a 4 Unit building with 3/1 Beds and 1/Studio. NOI of all 8 units combined is $41,320. Asking price is $275K.
My concern is: Would I be buying a huge head ache?
@Pete Schwan do you plan to manage it yourself? do you have any MHP operationg experience?
@Andriy Boychuk There is an on-site property manager who comes with the deal. Also, my father and I would manage the rest. I have property management experience and real estate investment but not mobile home experience.
Analyze as two separate deals. Mobile home side looks like just land value right now but check out mobilehomeuniversity.com to get up to speed. What condition is the infrastructure, ie public water/well or public sewer/septic or public gas/propane? Find a partner with MHP experience to determine scrap/rehab those homes. Maybe I'm misunderstanding something but my final thought is to lose the property manager, 4 out of 16 homes occupied and 3 of those allowed to deteriorate? Really? Good luck.
I agree, my first thought went to the property manager as well-if 3 of 4 homes are in disrepair then preventative maintenance is something the property manager probably ignored and is not worth the expense. Tread carefully, there could be any number of expensive repairs that you aren't aware of. Just my two cents , Good luck
@Pete Schwan how much is the lot rent? will the seller finance the deal?
The owner owns the homes and rents them at $500/piece. The seller wont finance.
Analyze as 2 deals. The mobile homes are technically 'personal property' and the value is in the dirt. Most MHP buyers have -0- interest in owning the homes as the cost of maintaining them can be prohibitive. Not to mention obtaining insurance for them which is also very expensive.
The property manager is not doing anyone any favors. I'm in full agreement with the others calling for a change there.
I don't know anything special about mobile home parks but I did come across this article the other day. Definitely worth looking at if the deal requires you to basically install 12 more mobile units:
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