Poking around an area of town we like last weekend, we came across a tasteful little mobile community. To qualify, it is a quiet elderly community with grand old trees, full hedges, lots of greenery, good lot privacy, community pool, recreation area, and hardly a person in sight of the 100 or so units placed throughout the meandering network of roads.
The unit is a '61 Travelite single wide, probably 10', maybe 12', with tongue removed, skirting, attached screened porch on slab, added on master bedroom, clean and bright finish with good lighting inside. All appliances are recently updated, four a/c window units. It is a clean and comfortable living space.
Lot fees are $475, and annual taxes on the mobile are <100. High electricity bills in peak summer months run around $150.
Asking price for the unit is $8,000.00.
I would like to start a brainstorm session on the good, bad, and ugly of this scenario. What I see is an accessible entry level property that could do one of two things: easily cash flow 2% as a rental, or provide a comfortable place to live and squirrel away the difference. (current rent+ utilities is around $1500.00)
$1500 a month to live in a 1961 single wide trailer. Seems kind of high to me. I'm not sure you could rent it to somebody for even close to that. Not sure about that area, but you could get a decent house to live in around here for that.
that is what we currently pay, by way of contrast to the $600 it would cost to live in the mobile.
Is this an actual deeded lot or what is more typical of mobile home parks: you're renting the lot? If it's renting (for $475), this isn't an "entry level property", it's depreciating personal property. If $475 is HOA dues, then there's little room to build equity here. With the age of the trailer, your capex costs will be high. Your rental market may be folks on a fixed income. Consider the costs if you have to move or demolish the trailer. I've looked at deeded mobile home lots in my state and think there's potential, but it's a different analysis than traditional sfrs. Best of luck to you.
Reality, $1,200 P+I and $300 for taxes and insurance pays for a $225,000 loan. I might believe that if your '61 Travelite was along Central Park but not in a mobile home park. :)
Read more carefully, guys. The $1500 is what he is paying in rent now. Information offered to illustrate the potential benefit of buying the trailer.
To answer the OP, if you can stand living there, maybe not a bad idea. As a rental, terrible investment.
It all depends on the market demand. If there are folks who are willing to live there and the home fits their criteria, there is a need. As far as living in the unit goes, it's a personal decision. By far, the condition of the neighborhood is one of the best indicators.
Hope that helps, good luck!
@ Theresa; If I rented there at a savings of $800.00 / mo, at ten months the initial investment would be a wash. I'd never expect to build more equity in a trailer, but would be in a good position to amass cash for further investments. The $475 lot is a rental.
@ Richard; I'm from Peterborough. Thank you for clarifying what I tried to state clearly. I would happily live there as it is a clean and bright place, plenty of space, mature landscaping, community pool, safe, quiet . . .
@ Rachel: I haven't checked comps, but I guess it would rent in the $600-$700 range.
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