Anybody investing in Arkansas and/or Hot Springs to Benton area?

Question

Hey everyone,

I am looking to start investing in mobile homes and MHPs around the Malvern, Arkadelphia, Hot Springs, and Benton area. Is there anyone here who is currently investing in this market? I would love to meet some people doing this and learn more about this particular market.

Here is my current situation:

My parents currently own a MHP that only rents lots and occupancy has declined over the years and we are down to about 7 lots rented of about 20. We have big lots (approx. 100 x 100) and I am setting up a website and facebook page going to help increase our visibility. We have one home that was abandoned on our property recently and we are in the process of finding out if we can take control. If so, then this would be my first rehab project. I would like to then sell for payments once finished and if everything goes well, start bringing in more homes to do the same.

I am open to any thoughts on how to decrease vacancy and about selling for payments. Hope to hear from you guys soon!

Thank you,

Justin

Sarah Hansen · Answer

Hi Justin,

We are currently learning this niche as well and have made some offers on parks, but not closed on one yet. Yes, a website and Facebook page will certainly help increase visibility. You're on the right track there.

Our strategy for a park like this would be to either incentivize people to put their mobile homes there to start collecting lot rents (parks in our area often offer to pay to move the mobile homes to their park if they sign a longer lease); or to find some used mobile homes for a discount, rehab them, move them to the park and then put owner occupants in there paying the lot rents and a mortgage to us that we would owner finance to them. I never want to be called to fix a toilet. That would be included in the agreement - Bank of America doesn't fix your toilet, and Bank of Sarah doesn't either. This would be their home that our LLC would hold the mortgage to and finance to them.

I'm sure there are a lot of more experienced people than me on here, but those are my initial thoughts. Can't wait to hear other responses!

Sarah Hansen · Answer

Not to muddy the waters, but I just found this while researching it a bit further. This website says there isn't a cap in Arkansas on buying and selling. I don't know how old or reliable the info on the site is, but it's tough with so much different info out there. I remember reading on BP forums the one-per-year rule, but other sites say differently.

https://www.mobilehomeinvesting.net/mobile-home-license-per-state-how-many-can-you-buysell-per-12-month-period/

That's why I'd talk to an attorney to stay on the safe side. If you know of a good resource page for Arkansas on this stuff, with updated reliable info, I'd love to know about it.

Justin Jones · Answer

@NaDean Bowles I'll send you a pm

Meg Melody · Answer

@Justin Jones Hi there! Hope all of this went well! I'm an investor in Hot Springs, Benton, North Little Rock, and Shannon Hills area. I own one mobile home on land in Hot Springs but usually stick to regular SFR. Would love to see how things are going for you now that it's been a while in your journey. Thanks!

Account Closed · Answer

@Justin Jones We have a RE investor meetup in Hot Springs every month. Believe there are some people who have experience in mobile parks. The next meeting is Sat. @ 6:00.

If interested go to MeetUp.com and join for more details or PM me.

Sarah Hansen · Answer

No, I didn't mean to say that... sorry for the confusion. Straight up cash sales would certainly fall into the buy / sell criteria. I was hoping that an owner finance could get around it. But, they would probably count those too. I fully admit that I need to learn more about this and talk with an attorney to make sure I'm thinking about it the right way. However, if you need to fill pads and make them profitable, and it's tough to get people to move there to just collect lot rents after marketing and offering incentives, worst case you could buy mobile homes and rent them out to make the pads performing, and then slowly convert the rentals to owner occupants over the years as allowed.

Justin Jones · Answer

So, if I sell for payments it is one per year but for cash there is no limit?

Sarah Hansen · Answer

Sorry, I didn't see your other question on selling them. I'm not sure if the one-per-year rule in Arkansas applies only to a straight buy / sell or if it limits owner financing. If we bought a large amount of mobile homes to fill our park, but then owner financed them, I don't know if they would look at it the same way as a straight sale since we would hold the note and ownership of the mobile home wouldn't pass until the tenant paid off the note. I guess worst case you have park-owned mobile homes that you rent out and slowly turn over to lease-purchase agreements as allowed. But then you need to deal with repairs while they are straight rentals.

Sarah Hansen · Answer

It's up to you. You can start where you're comfortable with a business page and see if you get traction there. It may be all you need. I've noticed most of the mobile home parks in our area don't really set up websites very often, but I'm not sure if it's due to the fact that the owner base is less technologically inclined to put in the marketing effort or there just really isn't much of a need for it. In our area, affordable housing is tough, so the parks stay pretty full. My guess is they just don't need to market very much.

If you wanted to do a website outside of the business page, there are quite a few platforms. A nice free website platform that is easy to use is wix.com. They allow you to choose a platform and customize it as you wish. You are limited a bit on design flair, but it would definitely get the job done for you if you wanted to go the website route.

Justin Jones · Answer

@Sarah Hansen As far as the website goes, should I have a separate one outside of google? I stumbled upon doing a google business page for it last night. I am good with technology but have not gone into building a website before.

As far as selling the MHs, from what I gather I can only sell one per year without a license, is that correct?

Anybody investing in Arkansas and/or Hot Springs to Benton area?

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