All Forum Posts by: Bill Ayers

@Kyle Dee Congrats on wanting to get into MHI. As far as funding, have you considered doing the funding yourself? I do this and find it a great model to create monthly income for several years without being a landlord. And yes, MHI is VERY different than real-estate investing. Mobile homes are constructed very differently and therefore maintenance and rehabbing are completely different than conventional homes. I highly suggest doing a considerable amount of self-education before jumping in. Please let me know if you have any questions.

I have heard of this being done in parks near me.

Here's a thought if the buyer is willing to work with you on this. Have them go in and apply for the park saying they are interested in buying a park owned home. Once they're accepted then I would find it unlikely the park would have any grounds to then not consider them accepted to buy your home. At the very least you would have more grounds to show intent to defraud if they deny the person the bility to buy your home.

Otherwise I have to agree with the other comment about hiring an attorney to write a letter to the park owner.

Don't forget to ask the city/county if you are able to replace the old homes with new ones as they need to be "retired".  Some areas change zoning and do not allow homes to be replaced once removed.

As far as pricing, personally I would add very little on top of the valuation of the land to account for the purchase of the homes. And by very little I mean $500 per home. They are super old and are only worth very little if they are all in great condition... which I would find unlikely. Of course, the ones with cash flow would be worth more. 

As is, to me, this seems like a deal that if all goes perfectly (which it never does) it could be an ok deal. In mobile homes great deals are everywhere if you know how to find them and understand the market. So, do not be afraid to make a very low offer. It sounds like he needs to sell it a lot more than you need to buy it. In my estimation, small lots like this are very difficult to sell due to a slew of different reasons. So just be wise and patient.

That is all I do. My formula is that I want to get back my investment within 9-18 months through the initial down payment and monthly payments of $300. Typically, I am looking at 60 months of payments. I will of course consider cash offers if someone wants.

I agree fully with Tyson Cross.

To address some questions:

Removal costs depend on the area.  Expect $1500 or more per trailer to be removed. See if there is a mobile home dealer in your area. Ask them for local prices. They also can give you answers to most of your questions on costs.

If the park had trailers on all lots and most were occupied, I think the asking price could be within reason depending on the area in which it is located.

How do you feel the market is in that area for mobile homes? If the market is good to get the empty lots rented there is a decent potential, albeit with a fair amount of investment to get new/good used homes into the park.

I have a great problem. I have so many good to great mobile home flipping opportunities in my area that I am unable to fund even just all the great ones.

Does anyone have ideas/leads to funding sources for MHI in case I decide to ratchet up my business?

That is a very complex question actually. But to keep it simple... In my opinion the biggest risk of depreciation in a mobile home is the wrong renter. I have seen some homes just recently that were destroyed within months by tenants. For that reason, I only sell them. I do  not want the hassle or potential risks of owning mobile homes. So, selling it right away is my strategy.

Here is a more direct answer to your question about a mobile home being "too old".  I think of them more like used cars. If it is very well taken care of versus abused, it keeps its value, if not, its value can easily go to zero.

I hope this is useful.

My experience has been an amount of 1 month lot lease as deposit when in a MHP.

@Jermaine Gourdine    I just started November 1st, but I am partnered with a guy that has been doing it since 2002.  I already have 3 deals pending and will be closing on my first home on the 23rd this month.

We never do bank financing. We try to buy on payments. Then we flip them usually on payments, sometimes for cash, and never rent them. I think there are a lot of ways to mess up and lose money. So it is super important to know what you are doing, what the market is and how you have a distinct advantage/niche.

But I love it and am having a ball. I do it full-time.