Updated over 5 years ago on .
First Mobile Home Park Deal
Investment Info:
Mobile home fix & flip investment in Carthage.
Purchase price: $130,000
Cash invested: $18,000
The Good, The Bad, & The Ugly of my first Mobile Home Park deal.
What made you interested in investing in this type of deal?
Cash-flow
How did you find this deal and how did you negotiate it?
Driving on my way to meet a client (for my realty business) and saw the park, which looked distressed. I found the owner through the county records and contacted them. Over the next several weeks I was able to build rapport with the owners; we went to lunch, talked on the phone, figured out what they wanted, and found something that would work best for both of us.
How did you finance this deal?
The same local investor who held the note for the previous owner held a new note for us. We agreed to put $10,000 down, pay $1,200/month, with a 12-month balloon (unless otherwise agreed upon terms).
How did you add value to the deal?
Being one of three partners; the value I added to this deal was that I found it and that I was the managing partner (boots on the ground) handling all the day-to-day operations of the park.
What was the outcome?
We are currently cash-flowing ~$2000/month. But because of the current market, and the short-term plan for this property from the start, we put it on the market and currently are under contract, with a closing set for mid-December.
Lessons learned? Challenges?
The two biggest lessons I've learned are: 1) The responsibility of a property/park manager. I gravely underestimated the amount of work and attention needed for this role. 2) Even though there are great investment opportunities and money to be made, we're dealing more with people (& their lives) more than actual real estate. And being in the position of owner, we can either drastically help or hinder the people who are living there. That position holds a tremendous amount of responsibility.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Richard (Trey) Yelverton is the real estate attorney we have used and he and his team are fantastic!