All Forum Posts by: James Park

@Thomas Gardner Thank you for the detailed and thoughtful response!

To answer your first question - the reason I even considered this in the first place is because I got to know the maintenance man when I was interested in purchasing the park for myself.  Even after I wasn't able to purchase it, I kept in touch with him and asked him to keep a look out for parks and mobile homes to invest in for me.  

In talking to him one day, it sounded like the new management was going to render his job obsolete.  And he also mentioned they wanted to sell off the park owned homes.  So he put me in touch with them and we got talking about me purchasing the entire portfolio of homes from them.  My thought was to utilize this handyman for this project, not do the work myself.  He was paid $10 per hour and lives in the park and very much wants to continue working as he was for the previous owner.

To your second question - probably not.  I don't think they would sell me their whole package of homes for pennies on the dollar, just to see me flip them to residents.  I could be wrong, but I've been afraid to broach the topic in fear that they may just decide to do this on their own.  I believe their motivation to do this deal with me is that I am someone they can trust to hand over their homes to, and now I'm responsible for lot rent.  So they get their certainty in collecting lot rent from me for 33 homes and not have to deal with individual tenants and collections.  Right now, they are not all occupied but most of them are.  The new management has been working to rehab some of them and rent them out.  There's only a handful that I'd take on once I took the portfolio of homes over.

So I don't think selling off the homes or making them responsible for lot rent will work in this instance.  I think that's the main reason they are allowing me to do this deal.  

Another good thing, however, is that I may be able to do this on a lease-option arrangement.  So that way I can put very little down and work the business without committing to buying them all just yet.

I'm more interested to know what I can expect from a maintenance expense standpoint.  I need to assume for now that I will have to pay the handyman full time hours at $10 per hour.  So the rest is a question mark in mind in how much I'll need to shell out for supplies and such.

@Brandon Cravens Don’t they require you to get a dealer’s license? Have you gotten one already? If so, how difficult is it to get a dealer’s license?

@Janice V. I've looked into these business loans.  The problem is, I haven't owned the parks for long enough to show much of a history.  I'm going to look into them again in another 3 months or so.  Thanks for the advice!

@Thomas Gardner Maybe you can shed some light on another deal I'm looking at.  The story is that there was a mobile home park I was looking at (actually 2 parks in one package) that totaled 58 lots.  It was a great deal, but I was not able to purchase it because I couldn't close another deal in time to buy this one.  Long story short, I maintained contact with the seller, but also reached out to the new owner.  I am working out a deal with them to purchase all 33 of the park owned homes in the two parks.  I'll be able to get in cheaply, but the risk is that I am responsible for not only renting out the homes but I have to be responsible for the lot rent to the park as well.  So, it might be great for income, but I also wonder how deep the downside is if things don't go well.  I feel confident I can get good renters in there over time, but I'm worried that tenants might damage the homes and I'll be responsible for expensive repairs, maintenance etc.  

To provide more detailed numbers, I am going to be able to buy the homes for between $1,000 and $1,500 each.  Some of the homes are older, but some are not too dated and most of them are in pretty good shape.  The owners of the park want to boost lot rent from $190 (current) to $250.  

Based on the park's history and analyzing the market, I should be able to charge $450 to $480 per rented home.  So that's between $200-$230 per month for each home that I am able to rent out, then $250 goes to the park for lot rent.

Do you think this is a good deal?  Or are there risks that I may not be seeing or downside that I should avoid?

Thanks @Rachel H.

@Janice V. short term working capital from where? I’d definitely look into it but not sure where

@Thomas Gardner that would be ideal other than the fact that transport and setup can be expensive. I have 19 vacant lots and moving and setting up 19 homes could cost me $100K or more, which I don’t have.

@Gulliver R. that’s the problem. The banks I’m talking to now won’t lend me more money against the properties. They need to produce more income, but can’t without more investment dollars. So it’s a catch-22.

@Gulliver R. between both parks, I have 19 vacant lots out of 55 lots.

Hi everyone,

About a year ago, I decided to focus my investing efforts on mobile home park investing.  It's been an interesting journey so far, but I've had some success buying some out-of-state properties - specifically in Indiana.  FYI, I'm from California and don't know anyone in Indiana whatsoever.

Nonetheless, it's been a good experience so far.  

I have purchased and flipped a distressed mobile home park.  From there, I acquired a small park (14 lots) and about to close on another 41 space park less than a mile from the small park I currently own.

The great thing is I was able to purchase these parks with very little down.  

The bad part is, the banks have only been willing to finance the park, but will not allow me to borrow money in order to bring in used homes to fill those lots up.  That's what is really needed in order to maximize the revenue and value of the park.  

Does anyone in this forum know lenders that might be willing to assist with something like this?  I'm open and flexible to different options including possible partnerships if it makes sense.  

I understand the Clayton CASH program, but they require the park owner to be a dealer, which I'm not.  I'm looking into getting a dealer's license but so far it's been a confusing process and I don't know if I will qualify.  

So for now, I'm looking for funds to bring in mobile homes into my communities, which will really help boost the value of my parks substantially.

If anyone knows someone, or can suggest any good options for this, I'd greatly appreciate it!

-JP