List Price: 150k
2/1 SFH - $1200/month rents
1/1 Mobile Home - $1000/month rents
Ins: $100/month Prop Tax: $150/month
Home seems to be in fairly good condition. I am estimating less than $5k for touch ups.
The SFH is currently not rented, but mobile home is. Both are metered separately and tenants handle their own utilities.
Seems to be a C neighborhood.
Expected CoC Roi after PM/Reserves: 35% ($987/month)
I NEVER find deals on the MLS. This seems too good to be true. What am I missing? What questions do I need to get from the seller? I know I need to get an estoppel to prove rent of the mobile home unit.
Hey @Joshua Richter , welcome to the BP community!
First, I would make sure that property is zoned in such a way that allows for there to be a MH on it. If it's conforming, you are good to go. If it's non-conforming, you will just have to decide whether the risk is worth the reward.
Next, find out more about that mobile home. How old is it? What is the roof made out of? What are the walls made out of? The floors? These are important questions because it will tell you how frequently you will be doing repairs and how soon after buying you will have a major capital expense. You definitely want to get in that MH before buying to see what the condition is.
The estoppel is important for verifying all terms of the lease, not just the rent. So yes, definitely get that signed.
Why is the SFH not rented? Do the owners live there? How are you getting that $5k rehab number? Have you been out to the property yet?
Does insurance cover the MH?
Definitely could be a solid deal, but make sure you understand the MH rent model because it is definitely different than the SFR model.
Please, feel free to message me anytime if you have questions or just want to chat!
@Brenden Mitchum thanks for the quick response! I assume I can just call county office on zoning, right? I definitely need to get more info on the mobile home. These are all great questions that I will make sure I bring up.
The SFH was rented out until middle of December when the tenants moved out. The 5k rehab budget is just a buffer. I honestly dont think I would need it. The photos of the listing look good so honestly it will probably just be a deep clean to get tenant ready.
I will need to call around about the insurance on the property.
Thanks so much for the feedback!
Yes, just call up the county and they will be able to help. Typically, there is a specific department that handles zoning.
Great to hear that the SF looks solid. However, you really shouldn't assume this by some photos. I highly recommend having the property professionally inspected before purchasing, unless you are very familiar with home construction and infrastructure.
Same goes for the MH. Don't just walk through it because it sounds like you're not familiar with MHs and thus you won't know what to look for. Try to find someone local who has experience with them and would be willing to do a walkthrough with you.