MHP 24 pad 1 house potential deal.

[Dustin DeSmith]

I found the mobile home park for sale, I met with the owner and discussed some numbers.

Asking price $350,000

24 lots and 1 house included.

city water/sewer paid by tenants

house rented at $700/mo

1 mobile home owned by park rented at $600/mo

1 vacant lot no house 1 vacant trailer owner is selling not paying "maybe I'll buy it to rent or sell owner financing?".

21 rented lots at $225/mo

5 have dogs at $50/mo

giving us $6275/mo or $75,300/mo Gross

he gave me his expenses at $8,700 annually so 725/mo

so that $5,550/mo or $66,600 annually net minus financing

He removes the snow himself but I got a quote for $200 per snowfall. I do live close so I guess I could do it but I don't want to so I'm trying to budget it in.

so even with the 2 vacant it seems to be kicking off a good ROI? What do you guys think?

Thanks Dustin

[Dmitri K.]

@Dustin DeSmith, $8700 of annual expenses is an awful understatement. That is only 10% of the park income. Usually good parks run at 30-40%.

I looked up average property tax rate in Wisconsin and it's 1.76%. So you'll be looking at $6000 + just in property taxes based on the purchase price.

I would triple the expenses that he is giving you and go from there.

With that said: 225x21x12x0.7x10 (at 10 cap) = $396900

So 350k might still be a good price.