I never hear much from folks on these platforms about what's become my pet phrase; "Is the park in the PATH of PROGRESS? Or is it in a blighted and run down area where folks are leaving through natural attrition, employment or lack thereof, retirement, or other reasons.
You can have a great MHC with lots of homes but if it's in a run down area or a location that's being left behind there's usually a reason for it. What I always do is check the real estate trends in the area I'm interested in before I make any investments. If a community is in a state of disrepair there's usually a reason for it.
If it looks like the area, albeit run down and in need of moderate to extensive upgrading, is undergoing progressive and aggressive gentrification that's the perfect place to invest in IMO. However, if that area is being passed over for other more progressive and upwardly mobile (pun intended) areas I'd proceed with extreme caution unless you want to end up being a slum lord.
There's an age old adage in this industry, "The higher the rent the lower the value of the home goes". Point being, increasing rents in order to boost ROI which most newly acquired MNPO's must do in order to realize a return, disincentives the resident/tenants from doing any upgrading let alone deferred maintenance or MH replacement because they are more concerned about how to pay their rent.
If you own your own MH's its even worse in that you're less inclined to put good money after bad by trying to keep old heaps up and in a rentable condition. Additionally, the quality of renters diminishes as the quality of the MH's decreases.
Most importantly, however, old MHC's have old infrastructures and that's where a lot of newbie MHPO's can really take it in the shorts. Sure it's a fact that the one thing that makes MHP investing so alluring is the fact that the MHPO is only responsible for the land and utilities up to the pedestals while the resident/tenant is responsible for everything else.
But, if you have to start out by upgrading the in fracture you'll be biting off a big chunk of your ROI from the get go. Additionally, the MHPO has the responsibility of maintaining the roads, perimeter fencing, drainage, which can and usually problematic as MHP"s seen to be located in flood plains or on slippery slopes.
I could go on but don't have the time. As a final note I own and invest in MH's, stick built, commercial and ag land and do reasonably well in those arena's. I could have purchased or invested in MHP's several times but once I started doing my due diligence I always seemed to gravitate away from MHP's for one reason or another and they were usually pretty good decisions.
