I've recently found a motivated seller of a mobile home in southern New Hampshire. I've listened to the recent mobile home episode on the BP podcast, but because of difficult nature of comping this deal, I'd rather share any potential profits in exchange for help from a more experienced investor.
I'd also love to hear any tips from people with experience in this market niche.
David, the few investors I know who have done individual mobile home investing have said they wouldn't do it again. Partly because of the challenge of the rehab when the area doesn't have tons of suppliers of the specific materials used in Mobile Homes. Also, if the home is older, your buyer can't get financing.
If the MH is in a park, the parks generally restrict rentals, and sometimes restrict who you can sell it to. This is because they want to control the homes themselves, so these policies restrict the outsider and make it easier for the park owner to buy and sell the homes. This is obviously not the case in all parks, but is worth checking on policies in your due diligence.
If the MH is on it's own land, that's a different and you can generally get comps from MLS if the town has other MHs that have sold. Another twist is that developers will sometimes buy a MH on it's own land if the well and septic are in good shape. Saves them installing a new well and septic and they build a new house on the land. Of course you have to buy the property for only it's land value.
Not sure this is helpful, it's all sort of negative, but there it is.
Good to see you're willing to help MH sellers that need your skills and quick action as an investor. Additionally good job finding this lead.
Ann gave very good feedback with regards to comping a mobile home on private land. There are additional factors to consider however basing your numbers on recent comps nearby will have you understanding if this deal is a pass or worth making an offer on. You say this sellers is motivated so I would encourage you to make an offer regardless of what the seller is asking as long as the home itself can be profitable, is at least a 2 bedroom, and doesn't need much rehab.
You didn't yet address is the home is in a park or on land. Ann has some good point here as well. Additionally, mobile homes in parks will often times sell much much faster with payments versus an all cash or conventionally financed sale. For this reason make sure you have a demand in your area and know what buyers will pay, and how to find said buyers.
The only extra item I'd like to discuss is the fact that all the investors Ann knows of said, "they will not invest in mobile homes again". This is an all too common response I hear from folks that jump into this market without training that think MH investing is anything like traditional SFR investing. MH investing is very unique and it is sooo easy to purchase a property for too much money or leave extra profit on your closing table when you resell.
With that said be careful and try to get some advice from a seasoned investor locally or otherwise that can help. If you have any pictures feel free to add them here so we can comment on them or email them to me personally if you wish for any further feedback.
I hope this helps and makes sense.
Thank you Ann and John for your responses. I truly appreciate your time and expertise.
I've gotten additional information and unfortunately, this does not seem to be a situation in which I can help. Although the home only seems to need cosmetic renovations and landscape work, it doesn't have the benefit of being in a mobile home park. More importantly, there are two deal killers for me. First, the owner of the mobile home does not own the land it is situated on, and second, the home was built in 1972.
I've developed a nice rapport with the owner and I'm disappointed that I won't be able to help. If this was a SFR, it would be a classic success. I'm going to spend a little more time finding an investor with experience in mobile homes in case I find another lead.
Again, thank you very much for your help.
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