All Forum Posts by: John Fedro

Hi all,

Good thread and answers. 

Over the years it has definitely been, making mistakes. Mistakes on filling up my homes with the wrong people, investing in the wrong properties, making the wrong repairs, overselling or underselling, being to eager, working with the wrong partners, following my heart, etc. 

However I suppose without all these mistakes I would not be where I am today. Not sure if this answer helps or is what you were looking for however it is the first/biggest thing that came to my mind. All the best.

Talk soon,
John

Hi Jennifer,

First things first, great job reaching out to the seller and making contact with the park manager as well. It sounds like when speaking with the community manager you were professional, courteous, sincere, and humble. This is what we should definitely aim to be when speaking with park owners and managers. We also want to use the correct verbiage and let the manager know that we will not be renting/subletting the home and do intend to keep it in the park and sell to an end buyer. It sounds like you have done this in the manager was still giving you some pushback for a variety of reasons, including the fact it sounds like she just didn't want to work with you in the first place. I mention this because of all the requirements you mentioned in your second comment these are all overcomeable when dealing with the community manager that sees the value in working with you.

The way I see it you have a few different options at this point. You may try to purchase the home without becoming approved at the park or transferring ownership into your name. At that point once you find a buyer you will transfer the title from your seller to the new buyer and remain on his lienholder potentially. However this option will be frowned upon via the state and park, plus other complications, if you are found out. You may also try to simply wholesale the home to an end buyer however this may or may not be possible depending on your exact area and the exact community. Additionally, you may pass on this current opportunity and keep revisiting this park manager to let them know you are not a "fly-by-night" operation and you are here to stay. Once the manager sees your face a handful of times they may welcome you more readily into the park.

However with all this said it definitely sounds like this community is not very warm or open to you being in the park at this moment. I would encourage you to reach out to other local parks in your area to reach out to these managers and owners if possible. I regret that I do not have a "magic bullet" to give to you that would solve all of your problems however some (few) park managers end up killing our deals that we have worked out with a motivated seller. However there are definitely more parks and more sellers to talk to and aim to help if possible. I hope this all helps and starts to point you in the right direction. As always, if you ever have any follow-up questions or concerns never hesitate to comment them back here and I'm sure we will all be able to help you and assist you when possible.

Great advice for everyone else as well.

Talk soon,

John

Hi Aaron,

Everyone above has provided great advice and questions for you to ask yourself. Your question about should you do the deal or not definitely has an answer, the answer is "it depends". In fact this is the answer to most things when it comes to real estate.

This park is fairly small so either you will need to manage it or have a part-time manager nearby to handle issues when they inevitably arise. Rachel also mentioned a great point that these are all rented which can definitely cause problems of its own as renters typically do not take care of properties as well as owners will. However renters will pay you more money monthly than somebody that simply owns the home. With that said you may likely be able to sell the homes for payments depending on the area. However you mentioned that these are all section 8 rentals so I'm guessing that the area may not be super upscale or ritzy.

You also mentioned that you have $30,000 to put down on this property. When talking to the right mobile home park owners, this $30,000 could definitely be used to purchase another, larger, community in or around the area. When buying a community this small you may run into issues when you go to resell the property in the future. The homes will simply be older, the land obviously the same size, however the revenue may have gone down by half if you decide to sell these properties and simply collect lot rent, which may cut your gross income in half.

There is definitely a lot more to consider that I am not including in this quick comment, however in my opinion this park may not be the best use of your time, energy, and capital.. at it's current price. With that said I do not want to be a wet blanket as this park certainly would eventually be profitable, however is it the path of least resistance or your best use of time… Probably not.  With that said if you truly like this community and the area, perhaps you would be able to make a lower purchase offer to help sweeten the deal for you. I hope this helps and starts to point you in the right direction. As always, if you ever have any follow-up questions or concerns never hesitate to comment back and will likely I'll be happy to give you some feedback if needed. All the best. Keep up the great work looking for parks and reaching out to hep sellers.

Talk soon,

John

Hi Jeffrey,

Thank you for reaching out and connecting. Additionally, thank you for your detailed messages as a certainly does help me try to answer your question a point you in the right direction moving forward. Please see my thoughts below in bold. I've included both of the previous messages in this one reply.

I have been watching some of your mobile home fix and flip videos on youtube and if you don't mind I was hoping to get your thoughts on a couple questions. Thank you for watching some of these. I do hope that they have been somewhat helpful to thus far. I'm looking to purchase a 197(?)3 2/1 single wide that's being offered from a park management company, they're asking $4000, although when I went in to talk to them it was take it or leave it price is firm. I've been through a lot of homes from the 1970s, some of them look amazingly well taken care of and others look like complete nightmares. Additionally, the size of the mobile home will matter is a larger home will typically attract more potential buyers. The area and other factors obviously matter as well.  The home is far from move in ready, I'm in construction and after looking it over and putting some numbers together I figured $5-6K to reno with me doing the majority of the work. Comps in the Boise ID area would be around $15K, so with material and labor it does'nt seem like there's much meat left on the bone. It sounds like you would be wanting to resell the home to an all-cash type of buyer if possible. Good job finding these comparable sales and understanding one exit strategy. Even when selling it for cash it sounds like it will be profitable at least a little bit. With that said I would agree with you that we are not in this business to make a few hundred dollars here and there, but rather a significant income moving forward.

My thought on mobile home re-selling is that it would be hard for someone to come up with or get bank financing (especialy in a park) especially in a part of the country where income wage is low. What are your thoughts about owner carry or lease to buy with a solid down payment, something close to paying off the purchase plus reno. The area that you are in is certainly growing and in demand. I'm certainly a very big fan of selling via payments when you are selling to the a low-risk tenant-buyer using correct procedures and paperwork. When selling on payments you will likely be able to sell the home for about 25% or more of your cash price. Whoever you may have to work with a tenant-buyer on the down payment and monthly payments depending on the park in the specific area of the city. Be careful when selling on payments as we can often make mistakes or sell to the wrong people which can cause you a good deal of headaches.

I should have added that space rent in the parks that this co. ownes or manages is $525/mo. water, sewer, trash and 5yr contract. I was hoping to be able to work a deal with them on space rent for the first couple months but they don't sound like they're into dealing. Would dealing with management companies that won't work with you be a deal breaker for you? The fact that the park manager will allow you in the community to purchase and resell the home is "working with you". With that said some parks are more flexible than others with regards to the price or terms they will sell their homes for, as well as a number of other matters. Whenever I work with folks we try to focus on the path of least resistance in and around the local area. I mention this because while this opportunity does seem like it will make some money, it may not be the path of least resistance or most profit for your first or second MH deal in a park. I would encourage you to continue talking with more managers as well as many more sellers if possible. Keep up the great work. This business is definitely not easy or for the lazy. All the best. If you have any follow-up questions or concerns never hesitate to comment back for us all to help or email me directly.

Talk soon, John

Hi Michel,

Welcome to the site. This site has a lot of great information with regards to mobile homes and mobile home investing. In order to help answer some of your thoughts and questions please see my thoughts below in bold.

I've been bitten by the mobile home investing bug and would like to get started. The types of homes I'm interested in are those that can be purchased in the $5k and under range and be sold over the next 3-5 years at a significant profit. F.S.B.O. Inventories seem rather low, almost non-existent. You have likely reached out to a number of parks and been searching online and off-line for mobile homes for sale. It is not uncommon to find a low number for sale under $10,000, $20,000, or $30,000 depending on your area. Additionally, the weeks of Christmas and New Year's will be exceptionally slow with more sellers and buyers coming into the market in the new year. You mentioned the types of homes and price ranges you are interested in, as you have alluded to this is easier said than done in most areas of the country. With that said mobile home sellers do need help and there are likely opportunities for you to move on if you know what you are doing and covering a large enough area. That answer is pretty vague however I hope it helps him and points you in the right direction.

I've been studying the markets in my area but several mobile homes for sale appear to be for sale by parks who will finance themselves. If parks are willing to finance properties themselves, is there still a decent market in markets like this to be able to make mobile home deals on contract? The answer, like most in real estate is, "it depends". In some hotspot areas around the country some mobile home park owners have taken upon themselves to move in a new mobile homes and used mobile homes to sell or rent themselves. Additionally, they may repair and resell or rent some of the homes they received back for abandonment or eviction. Some of these parks will definitely wish to have you as free-help in the community, however they may not sell you any of the abandon or evicted homes. In this case you can still work with sellers and also potentially moving homes of your own depending on the situations.

If the park is willing to work with you than the next step is to determine if they are selling a comparable home. This depends on what they are selling and what you are selling. If they are selling the exact same model mobile home as you for the same price and terms, they will definitely get their home filled before use fill your home. This may definitely not be a problem if the park is only selling one or two other very comparable mobile homes, however perhaps the park is selling five or 20 other mobile homes. Keep in mind that many times the homes the park is selling are not comparable to ours. They may be different ages, sizes, bedrooms, cash/terms, conditions, etc. There are definitely other things to watch out for however I hope this starts to answer your question about working with parks in these situations. Definitely do not sabotage yourself without going through the steps of reaching out to the park as best you can. Moving forward if you have any follow-up questions we are all happy and here to help. All the best.

Talk soon, John

Hi Ben,

First things first, congratulations with regards to this home! There will absolutely be many more for you in the near and distant future. Great job pulling the trigger and being available for this park, seller, and buyer. 

Repairs can absolutely go longer than expected, however it sounds like you certainly have some wiggle room with regards to your sales price. I’m curious if you sold all-cash or via payments, however in your area you can likely do both without too much time. Either way, great job again. The credit goes you for putting this all together and getting it done. Keep up the great work moving forward. Thanks again for sharing. As always, if you ever have any mobile home related questions never hesitate to reach out to us here as were all happy to help.

Talk soon,
John

Hi Dana,

Great advice everyone!

Good job being so active in the central Florida area. I have no doubt that this activity and your previous successes have not come without a great deal of hard work and daily effort on your part. Keep it up! 

There is not a national form type of website (yet, I am working on something similar), however there are a few FSBO mobile home type of websites, however this is likely not what you're looking for as an investor. 

If you do not wish to purchase all/some of these homes for a quick flip or long-term holdings then perhaps you wish to wholesale or bird-dog some of these leads to active MH investors in the area.

I do know of some folks in the central Florida area that are actively investing in mobile homes inside pre-existing communities and attached to private land. These are hardworking honest investors. If you'd like me to help put you in touch with some of these local mobile home investors never hesitate to reach out anytime.

Thanks for the shout out Matt.

Lastly, have a great Thanksgiving everyone!

Talk soon,
John 

Great story Skylar! Great name too. I have no doubt that these stories are just the tip of the iceberg. You have likely gone through a tremendous amount of struggles and lessons to get to the point where you are. Keep up the great work moving forward! There is much more to come. All the best.

Hi Chad,

Great job being proactive and wanting to help local mobile home buyers and sellers. You are certainly in a good area of your state for this type of investing, away from the coast and fairly close to the interstate.

First things first, what a great website this is that you can ask a question and receive a bunch of great advice in such a short period of time.

Remarks that folks made above were mainly correct. The state of California does want a person to have a mobile home dealers or retailers license if you plan on purchasing and reselling mobile homes inside parks. If you will be acting as a real estate agent or broker in order to help facilitate a transaction between a mobile home buyer and seller then you should be licensed as a real estate agent or mobile home dealer.

I think it’s important to also mention that there are certainly investors and mom-and-pop type folks buying and reselling mobile homes without the proper licenses all around the state and country. In no way am I saying that this is the correct thing to do, however I did want to mention it because it is reality and important to understand. Some of these investors do not have the proper licensing, the proper paperwork, proper procedures, and maybe not even the proper ethics. Some folks are not licensed due to ignorance, some are just lazy, and some have just chosen to avoid following the law on purpose. However, until someone reports each and every individual there will always be more unlicensed people investing in mobile homes, cars, and likely other types of properties. Two reasons for some people not choosing to be licensed may be because there is no one actively checking on why you are buying or selling any specific mobile home that you are dealing with. Additionally, most mobile home park managers and owners will not require or ask you if you are licensed within the state, however some will.

I hope this all helps and makes sense. Again, getting a license is the right thing to do, especially if you will be in this business for any length of time. As I’m sure you know the list of requirements for licensing can be found on the HCD website.

All the best. If you have any follow-up questions never hesitate to reach out anytime. We’ll all be happy to help.

Talk soon, John

Thanks for posting Sam. Absolutely great work! Keep up this ambition moving forward. This is just the first of many syndication deals for you. Thanks again for sharing.