A mobile home park scenario

[Kevin Greer]

OK I'm new to this, and hope I get my biggerpockts.com etiquette down right. Haha

I just wanted to pose a scenario and see what you all think.

There is a mobile home park listed for sale near where I live for $435,000
There are;
27 spaces
8 park owned mobile homes renting for 320-545
6 that just rent pads for 145-170
A $30 water, sewer, trash charge per rental.

Assuming the low end and taking the utilities out this comes to $5910 a month. Does this sound like something that is worth the hassle?
I realize I don't have the experience or capital to do this myself, I am just trying to understand howthe cash flow of CRE works.

Thanks for your time.

[Bill W.]

So there are 27 total lots; 14 are occupied and 13 are empty? Of the 14 occupied lots, 8 have park owned homes on them?

There are several ways to valuate a park but you would not want to consider the income from the rent from the homes. Instead determine the value of the park from the lot rent and then add the wholesale value of homes.

If the numbers I put above are correct, for a 10% cap, the park would be valued at $158k with a 40% expense ratio. Add in the value of 8 homes at $5k each and the total park value might be around $208k.