All Forum Posts by: Roger D Jones

I did this once years ago with a 'mobile home/land package' loan at the bank.  Home had to be new and if memory serves me correctly having it on an actual foundation allowed it to qualify for 30 year mortgages and better financing options when we sold it after living there for a few years.

The mortgage folks here on this forum will help you.

Your desire to be a youth pastor is both commendable and admirable- unfortunately it is not conducive to an acquisition of money and wealth. To own and profit from commercial real estate you will need significant capital to get leverage to purchase anything. There is no 100% financing out there for MHPs and even if there was it would pencil through to allow a significant bottom line NOI.

Invest your college money in engineering or accounting (fields where most millionaires reside) and then leverage your wealth to serve youth.  

There is something that has you spooked.  You may be a bit optimistic on your repairs estimate and I don't see any deduction for the on site maintenance manager.  Will probably want half his rent reduced.  Anyway... channeling my wife when I bring these to her she would give up 135k in leverage for only a five space park.   Also the percentages are good but the dollars are what counts and a new roof, deck, subfloor, refer, AC unit, furnace, frozen pipes, infestation, broken water or sewer line, delinquent tenant, etc and it all goes sideways and you are upside down.

Those homes are nice but older...  you could find yourself underwater pretty quickly and consistently if they are not in pristine condition.  Also the low rent indicates there may be quite a bit of delayed maintenance.  

Dmitri
Not sure what your attraction is to snow birds unless your thought is they would leave their trailer on site year-round.  Long term RV for working adults and professionals is our sweet spot.  Probably depends on your site location too.

Samuel,

Not 100% sure on my recollection but I think we were $4200 all in.  Transformer upgrade, wire and conduit.  I bought my own post, box and meter.  

Rog

My MHPs and LTRV parks are individually metered meaning tenant pays direct to the the utility for power.  Obviously the best way to go if possible.  Your answer will certainly lie with the utility company... they will know why things are the way they are.  Late last year I added a couple long term RV spots and went with one meter to save money (I include all utilities in the space rent for just these two RV spots).  Had to upgrade the transformer though and that was a bit of an expense.  Point being those necessary upgrades may be the reason prior owner chose to handle his own meter reading and billing.  

Anywho... call your power utility and they will have the scoop for you I am sure.

I think if you are actively engaged in the day to day operations with control of the decisions that shape your profit and loss- it is a business.  With an investment your dumping your money in someone else's bucket and allowing them the control and management thus the results.  Never really thought about it...

Interesting... I have grown up in Washington.  My parks are there.  You planning Tenant Owned Homes or Park Owned Rentals?  Given your beautiful location what is the status in the area for long term RV?  Those tiny homes are cute to look at but wickedly expensive.

A 16% expense ratio (if I understand you correctly) seems pretty low for an all POH park.  How many homes and is your uncle doing all the maintenance himself?  Does he have insurance on the homes and park?  

Jimmy

Best advice without getting into the nuts and bolts of your situation is to simply avoid building a mhp from scratch.  Unless you really have expertise in site development, permitting, construction, landscaping, etc... you will be in way over your head financially before you ever hopefully get a single home in your park.  PE groups are causing tremendous instability in the mobile home realty market which is keeping potential home buyers out of parks.  You are better off finding a pre existing park and purchasing as is.  

There is a reason very, very, very few new mobile home parks are being developed.  It doesn't pencil.