All Forum Posts by: Jim Johnson

I buy homes form wholesalers all the time. I pay cash, and put them in my parks. So the players might have changed- but there are many deals to be had. This next year- in several states- I will probably buy 20+ homes. Many of these will be from wholesalers. Is the margin as good- nope- but I pay cash on the spot. Most park owners can do this- our business in operating our parks and we look for people to bring us house deals. So you make $1000 or $2000 per deal, that is not bad money.
Here is how we do this- the dealer finds a home and forwards us photos. Then we agree to buy the home. The dealer arranges transport, and when the home hits our park- we have a check waiting. Most of time- we pay the mover as well- so the dealer is only out the front money for the home. So if the dealer pays $3,000 for a 2 bed, 1 bath 1980 14 x 60... we might pay $4,500 + the moving costs.
I have friends that bought over 100 homes last year to move into their parks.
My advise- find the park owners- and pre sell the home to them. That will get your feet wet. Find the right owner- they might even spot you most of the upfront money.

Be wise- but get in the game. Find a mentor if you can...

John,
Like any real estate product, there are people that price way low, and way high. I think for the most pat, many parks are priced by people that just do not understand how pricing works. They say- how much do you bring in each year- and price off the gross number. The owners get attached to a non attainable number, and until they are educated on how, and why, parks are priced the way they are- they sit. Many will not listen to why the park is not priced right. They have the money spent already in their minds- so the thought of repricing crushes dreams. On the other side- many would be owners do not have the skill sets that allow them to walk the seller, and agents, through the process of why the park is not priced right. They just toss out offers (which sometimes works) to see what sticks. Or they just say- your overpriced. In any event- if your going to make an offer- if you can back up the offer with data showing why you are making that offer- your chances go way up in getting the deal.

Some people also list properties that might have a highest and best use that is not a park, and that kind of developer does not come around every day- so some properties sit for decades...

Sam,
I always learn the skill first- then I personally train the VAs. I use 'camtasia' a lot- which records my screen and I talk as I do my work. The VA, or anyone that works for me can redo the training over and over if they get stuck. I found one really sharp VA that worked with others, I trained the first one, and then she trained the rest. I will say tough, if you can record our screen and your process- it saves time over showing the same task over and over.

On odesk, I look for contractors with lots of hours, good English skills and maybe they worked a support desk at some point. I also like good word processing skills and excel skills. I would say to look for VAs with over 1000 hours billed. My top VA has about 2800 hours with just me- I think I have about 6 active contractors right now. I have run as many as 10 full time.

In business- outside of the VA- I present all of my own documents, leases etc with the same program. Then my managers only need to push the play button and I know all of the docs are presented the way I want them to be presented.

Joe,
This is an interesting question. Let me say- my answer does not include debt service. I am looking for something on the buy side in the neighborhood of 60 - 65% of the gross. Because space rents very, I can not really put a dollar figure on this equation.
Of course, if you lower expenses or do something to increase income- that goes right to the bottom line and your return goes up. From the initial valuation side tough- your expenses should be in the 40 - 45% range of gross.

Sam,
I trained VAs from odesk who built the list, and they also maintain it for bad email addresses etc... I send the emails out- and share the email address with the VAs. They log in, and I separate the emails I want something done with into special folders. We use dropbox, and excel to keep the lists up to date.
It took a while to train a good team to do this.
In all- I probably have about 10,000 into the lists and training.

I have never had an agent tell me there is a upfront fee. I protect agents on any deals they bring my way- and I will sign agency agreements on deals- but not for entire areas. So they need to say- the 40 space park on the south side of town, or put in an address or something.
I will protect the agent within general agency rules- some agents want 1, 2 or 3%... some want a flat fee- like $10,000.

So an update- I have two very good looking parks that have offers out on them, and several more that might turn into something. Both good deals- would close before the end of the year.

I developed the list of agents myself- well, really I did the first state, then hired contractors to build the lists for me for the rest of the states I wanted.

I am really big on staying in my skill set- I do not mind coming up with ideas- but that is what I am best at- so I pass them into my system and find others to make the ideas click along...

Joe,
When we can not find someone on the inside- we go to craigslist for the right person. Currently I have 3 parks with inside managers, and I found 2 on the outside. I have tried using a manager that lives offsite- actually Dave Reynolds and I shared a manger for a while, and it did not work out very well. So we found someone inside the park again. I just make a list of he skill sets I am looking for, and try to find them in the manager pool. It is not as hard as you might think. Remember- if you build the expense into the front end of the deal- paying for the manager, and all the duties will not affect your bottom line.

So- bootcamps. Neither Dave or I are doing the MHPS boot-camps any longer. Just Frank is teaching them.

So here is a teaser- I had talked with Dave for a long time about starting a second bootcamp- more for people that want to hone the operations side. Anyway- I will be rolling out a course in the near future, that will combine online instruction and a onsite course in Colorado. It will combine the two. A student will complete the online classrooms and classwork, and then once on site- it will be no teaching per say- but all live time application of the skills. The on site class will be small- like 10 people at a time. That way part of the time can be in our offices, and we will have a mock setup of the managers offices as well. It will probably have a coaching side to it as well, but I am still working out the details on that part.

Joe- I think you hit on almost all of the options.
So we have managers at all of our parks. The greeter model, really pushed by Frank Rolfe of mobile home park store fame, is really managing with more duties back loaded to the corporate office. The duties still exist, it is really- who does them?
So our managers typically do it all. They mow, the fix basic things- like broken water meters, they collect rents, they make deposits, and we also have check scanners. Our managers show houses, in some cases they will rehab houses. We are very picky concerning the 'skill sets' our managers must possess. When buying a park, part of the front end duties is to assess what needs to be done in the park; daily, weekly, monthly and yearly. Then I build a list of tasks, and from that I pull out skill sets. Armed with all of that data- I look for managers. We have one set of full time mangers- the rest do it on the off hours they are not working- evenings and weekends. We use computer programs to track tenants- so they must have computer skills as well.
As for management companies- In the park sizes I deal with- 30 - 100 spaces, they eat all the profit. Unless you find one that will manage based on a % of gross- I would do my best to manage the mangers in house. I bought one of my parks from a guy that was using a company based in michigan to run his park, the 76 space park had a manager, an assistant manager, 3 full time maintenance people and a part time person as well. We use a husband / wife team to do the same workload. Taking it over was a disaster.
As a side note- if I am buying a park, and I learn it is being operated by a management company, I know off the bat I can probably save 10% of the gross by managing it myself through my mangers. One more point- you need to know what the management style of the company is as well. Everyone runs their business in their own way- and I think, in the MHP business you need to be tough- and graceful. I have seen tenants of 20 years- be evicted because they got laid off- had a gap in pay and the park would not set up a payment plan. The same park got the home with a rit, called the owner to tell them they could come to the park to see the home crushed, because it was too old to remain in the park. They could have waited a month, the owner would have caught up and they still would have a tenant. Remember- these are the homes of the tenants- not like an apartment where you own in, they own it. Anyway- I tend to look for the win - win solution, and error on the side of grace.
Each park is a bit different- but we use the exact same systems no matter what size park we are managing.

So- The commercial agents tend to have more knowledge- but both respond. For the most part- both have good leads. I try to get the managing broker at an office- they tend to have more of the inside scoop- and if they are not the right fit for the lead- they will pass me to who is.
I have used this in the past- and it is very effective. I actually teach it to the people I coach, and most of the time, within a few days they have a property under contract. That said- most people are more geographically locked than I am, so the deals they will do are different than mine. I am offering on about 2 properties a day right now- but most are vary overpriced out of the gate.

sidebar- agents will take my reply to a income / expense / rent roll - and ask if they can forward it to the seller. In many, many cases- the seller has no idea how to price a property like this, and the agents do not either. So they will send my email- then I will get on the phone with all parties and we will reprice the property. At that point- I can go under contract.

Sent out another 350 today- 24 fresh reply's in 3 hours... 2 new states covered...