All Forum Posts by: Roger D Jones

 Sherry, Don't walk away too quickly.  That seller attitude is exactly what you are looking for in addition to being family owned/inherited.  When I hear those comments I get increasingly engaged.  Just because someone is says they are frustrated having to manage something so much I can guarantee you it is because they are managing it poorly.  My number one park is 70% POH and I spend maybe 30 minutes per week engaged with it and make a great return.  Message me if you want some help evaluating it.  

Not a fan of ghost ads.  You have people actively and in many cases desperately looking for a home and you end getting their hopes up and then after not returning their inquiries we leave them disappointed and heartbroken.

Depends on how you structured the loan but I think you're gonna get 'clipped' by your bank.  How could you be selling a home only for lot rent?  Did you do it to just get out from under the maintenance?  

Homes are like cars with titles and they can be moved.  If the titles are still in your name... It may be ok.  If you start titles with those homes listed as collateral in your yet to be paid in full note I think you may have a problem.

I could echo everyone else's comments but this is a really tricky situation. To pull this off you would need years of expertise, deep pockets and time. And when I say time... I mean years of having your money tied up before you ever see any ROI. If you were my son I would telling 'don't do it! Go buy a existing park and build your empire from there.

Some states limit total amount you can collect on security deposits.  Best to check.

 Well... we have three parks.  11 space long term RV park, a 28 space all TOH park and a 20 (soon to be 22) space mixed park with 7 TOH and 13 POH rentals.  The 11 space RV park has a manager on site with free pad rental.  The 28 space TOH park has a resident manager who gets $200 off his rent monthly.  On the 20 space mixed park given we own 13 homes we have a W2 hourly maintenance manager who we have at 24 hours per week.  He handles all plumbing, 90% of HVAC, most electrical and all structural repairs.  

With the 13 rentals we get over double the cash flow over our TOH space rentals and we are committed to keeping our POH rentals in top condition.  All maintenance requests are requested through our park website and are handled immediately.  We compensate him very well with a great hourly wage, OT after 6 and weekends, paid vacations, 8 paid holidays and a year-end park performance-based bonus.  Even with this labor expense these 13 sites way over perform our 7 TOH sites on cash flow.

Now I know many on here will think I am crazy to do this but here's the rub.  The park is in a very rural near a couple small towns.  If I need a plumbing, electrical or HVAC repair... I am week's out when and if they ever decide to return my call.   That is not going to work for our tenants who are paying $1000 a month to rent from us.  And more importantly I don't want any phone calls at 1130 at night over a broken water pipe.  

The park is financially strong and performs well.  My wife and I also own an accounting firm and it too does well.  For both enterprises we pay our employees well and we share our success.  

I have all three versions throughout our parks- free rent, partial rent and a W2 employee.   Each park's situation dictates the need.  Our W2 maintanance manager is paid very well but is tasked with maintaining 14 POHs and overall care of the park.  We have honest conversations about his compensation and how it fits into this park's financials.  

Sam,

You are looking at it right.  He needs to understand you are buying one of two things- his business as a cash flow entity OR the property (retail) with two trailers (wholesale).  As a business with expenses, taxes, insurance, non-paying tenants, maintenance and an empty rehab trailer haulaway he is probably clearing $500 a month +/-.  If it is a clean guaranteed $500 a month that's worth a 50k sale price.  He is better off selling you the property and two trailers.  

These are the tough conversations with sellers you have to have when they let their parks and trailers deteriorate to the point of utter distress.  They took all the cash out of the park for years with no reinvestment of time, energy or maintenance.  Then they want to cash out again.  

But back to your original question... just show them the numbers by comparison.  You are only buying what they are selling.

I am no fancy investor but my 'Grandpa' advice would be this.  You have hooks into what could be in the future a pretty nice income driving property- multiple AirBNBs, wellness spa, orchards, etc.  I don't think I would tie up my leverage on a new mobile home- you may need it more for your other projects.  Maybe buy a used RV and a truck (you will need it if you don't have one already) and sneak up on the mobile home remodel and focus on the income drivers on the property.  

Just a thought... 
Good Luck