Zoning Changes For Mobile Home Parks

19 Replies

Hello.  I recently was looking into a mobile home park that  I was considering purchasing.  During my investigation, I learned that the zoning had changed and you are no longer allowed to bring in new homes, even if the old ones were destroyed.  

My concern is, can any city where I purchase a mobile home park randomly decide to change the zoning so the mobile home park is non-conforming and no units can be brought in?  

If that's the case, if one big hurricane hits a park like that all I'd be left with is a vacant piece of land.  

Does anyone have any experience with this?

Thanks!

if this is the case, then I wouldn’t buy it. Being able to bring in homes to fill vacant lots is critical. 

@Wendy Vaidic Yes, they can unless you know people on the city council. Knew a very experienced mobile home park owner who ended up being on the council in a small town. Though he got out of the business and went into commercial. Residential real estate isn't for everyone. 

@Wendy Vaidic I would speak to you attorney and reference the Bert Harris Act if the park is in Florida. I think it may only preserve the rights for the current owner but if the park is titled in a LLC or other corporate entity you may be able to simply buy the business instead of conveying the property and preserve the rights of the current owner. Good luck

@Gulliver R.   I agree that is critical.  I have decided not to purchase this park, but I am also now concerned about any parks I may consider in the future.

@Michael Gravallese I will definitely check into the Bert Harris Act. I'm still not liking what that does to my investment when I want to sell it, but perhaps the LLC will cover that. That's great news. I realize i need to research carefully to be sure I fully understand it and my rights are protected.

@Ryan Groene That is great advise.  

@Rachel H. That's a smart businessman!  I know a lot of cities are trying to get rid of trailer parks, but if they know like and trust someone who owns one it makes it more personal to vote for getting rid of it.   Not to mention the vote he would have too.

If the MHP is grandfathered then the only way it can fully come into compliance with city zoning is either: 1) The owner agrees to it; or 2) The sunset provision in the city's zoning ordinances has been met - this is usually 12 to 18 months where the grandfathered use has been ceased (e.g. abandoned or otherwise destroyed).  This cannot happen on a whim.

Hope this helps.

@Jeffrey H. It seems as if they are able to say you cannot bring new homes into a grandfathered park.  I do have to research this more though.  

That means as the mobile homes become unlivable, for one reason or another, the park will shrink along with the revenue.  Also, one good hurricane could wipe out an entire park and eliminate all income with it.  Perhaps, this is something insurance would cover?  This is another area I'll have to research as well.  

Insurance does have the ability to cover loss of income, but it's expensive.  

The grandfathered use of an MHP is the ability to move homes in and out of the park freely.  I need to dig up the posting, but there have been something like 75% of states that have tested grandfathering laws successfully when cities try to overreach their authority.  Sometimes this alignment can be fixed with a simple conversation with a very good attorney and the city's attorney.

The real question is will it be worth the expense and potential discrimination that could follow from the city - I have heard stories where the city will have their inspectors get very rigid when they do not get what they want to make the owner's life more difficult.  Other times it's not big deal.  At least clearing this would make the property more marketable...

Keep us posted.

This is an interesting question for sure and yes I’d agree that the real answer may reside with the local city council and may be different depending on the state and associated zoning regulations in place.

I’ve personally noticed quite a few mobile home parks in my local area and many of them are directly adjacent to (or behind) brand new housing developments.Literally people are building $350-400K homes and their view from the backyard over the fence is a mobile home park.

I have been wondering how the park is affecting that new home value (and how it will also affect it in the long run) and vice versa, how will the new development and city/county regulations affect how that mobile home park will do in the future.

@Wendy Vaidic Id suspect you’d be grandfathered in as Jeffrey H. was saying. You can probably bring in new homes to existing lots, but not develop new lots. Least that’s how it works in our area with other property types, “continuous use” allows you to be grandfathered in, as long as you don’t go idle for 24 consecutive months.

I don't have the specific case law for each state - and am not aware of any case law where non-conforming usage has been struck down.

There are a lot of threads on the Mobile Home University website where different people have tested this in different states that may help.  The entire concept of this should not dissuade you from investing in a certain state, and is typically only a problem in small and medium sized cities.

Hope this helps.

@Wendy Vaidic sounds like you have some members on the city or municipality board who are not mobile home park friendly and are trying to make life difficult. Meet with the city zoning and planning and dig and do some research. Also as another BPer mentioned earlier check on mobilehomeuniversity.com i know they have experienced this exact scenario before and have the experience and guidance on how to handle this. Search through their forums or just google it. You will find some credible advice and direction there i can promise you that. 

Yes, they can.  We've seen this in several small jurisdictions in the Houston area so it will vary by jurisdiction.  Remember there are multiple levels of government oversight so local laws/ordinances my be trumped by state or federal laws as well.  I would love to challenge this and similar laws as being against the Fair Housing Act.  There is no doubt these sunset laws discriminate against minorities and low income folks who need the housing the most.

We also saw the "law of unintended consequences" occur in these Parks.  That is, folks patched up the older homes and kept them "livable" knowing they couldn't bring in new homes.  Think about it;  new homes $40k - $80k, heck some even over $100k could be brought in but instead the laws made that illegal and instead worthless homes are kept on the tax rolls. It really makes no sense.