14 pad Mobile Home Park

2 Replies

I am looking at a deal for a 14 pad mobile home park. I have a good bit of experience in all sorts of of real estate investing but never a mobile home park. 

5 Pad Rented @ $295.00 $ 17,700.00

4 Pad Rented @ $320.00 $ 15,360.00

4 Pad Rented @ $325.00 $ 15,600.00

1 Vacant pad 


Ask is 425,000.00 coming out to 30,357.00 per pad site. 

Having no experience in mobile home parks looking for suggestions on things to look out for at MHP's and if this looks like a solid deal to others with experience. 

How many homes are park owned vs how many are tenant-owned? I'm guessing 13 park owned properties. We're currently trying to sell off all our park-owned homes and go to only collecting lot rent. 


Because we are currently responsible for the upkeep on all park owned homes. I bought 7 furnaces last year. Kind of tired of buying furnaces. 

Tenant-owned homes come with tenant-funded repairs. You maintain the land, the road in the park, and perhaps the utilities to the units. 

@Benjamin Spencer that looks to be a market priced deal. A park like that will run at a 30-40% expense ratio, the biggest variable being how it is managed. To be conservative, subtract 40% for expenses from your gross and your NOI will be just over $29,000. Divide that by the sales price and you'll see the park is priced at approximately a 6.8% cap rate.

If you are seeking that kind of return, then it may be worth pursuing.  However, if you are seeking a higher return, then you will need to do a market rent survey to determine if there is upside in the deal.  

  • Start with the apartments in the area. Call them and ask how much a 2 bedroom apartment is.  It should be at least double the lot rent at a mobile home park in the same neighborhood.  
  • Next, call the parks within 5-10 miles that are similar quality parks. Ask them what their current lot rent is and what else is included/excluded. 
  • From those calls, you will have learned what your competition is related to lot rent, and whether there is any real upside for you in the deal.  

If you discover the current lot rent is already in line with the market, then you'll have to negotiate price to make it a better deal. 

All the best,


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