It may not come to any surprise to hear that mobile home sellers and manufactured home sellers are quite different from traditional “site built” home sellers. Your rationale may be that if mobile homes are significantly different from traditional single family homes, then why wouldn’t the sellers be unique and different as well? In the quick list below, let us explore both common and unorthodox ways these mobile home sellers can be unique.
Disclaimer: The below article is written from the author’s own investing experience/statistics with the help of others. If you experience different results or feedback, this is perfectly acceptable.
Below are 6 ways mobile home sellers (in parks) are different from traditional SFR home sellers.
6 Ways In-Park Mobile Home Sellers Operate Differently Than Traditional Home Sellers
Mobile sellers may be working on a finite timetable.
Many manufactured home sellers have a finite date set in their minds as to when they need to leave their properties. Many sellers know that they will not or cannot continue to pay for monthly mobile home park lot rent past a certain month if they can help it. While some mobile home sellers are financially sound and not in a rush to sell, many mobile home sellers are paycheck to paycheck-type sellers who cannot afford to pay multiple bills on a property they are not even living in any longer. There are, of course, always exceptions to the rule, and the above are very general statements.
They still require due diligence.
All sellers, real estate or otherwise, have the ability to stretch the truth, tell white lies, and omit facts about a property they are looking to sell. This bullet point is not technically a valid one; however, this bullet point is to express the fact that human nature is in all of us, no matter where we live or what we are selling. Please do not incorrectly think that because someone is from a lower socioeconomic background that he or she is more or less prone to deceit. There are good and bad apples in every bunch. Always perform thorough due diligence on every mobile home or single family home you are looking to invest in.
They may be looking at fewer options.
Many mobile home parks and mobile home communities have restrictions on how mobile homes may be purchased and resold within their walls. In many mobile home communities, this eliminates the possibility of a lease option, contract for title, or other creative payment arrangement that does not convey title to a new buyer on day one.
With this said, mobile homes in parks typically have fewer options to be purchased and resold than traditional site built property on land you own. When you own the land, you do not need to worry about a park’s approval process and/or approval criteria. Even though there are fewer options when purchasing and reselling, many buyers and sellers still have the possibility to owner finance, bank finance, or even rent a subject property inside of a pre-existing community.
There is a higher need for investors’ help.
In almost every area around the country, there are more mobile home sellers located in pre-existing parks than there are cash buyers. Cash buyers are few and far between in many areas around the country, especially when compared to buyers that are willing to pay via seller held financing. There are even fewer mobile home investors who are actively looking to help local sellers and work with parks in your area. It is for this reason that many mobile home investors are greeted with open arms and eager ears from local sellers in most markets. When mobile home investors correctly positions themselves, they are often one of the few offers that some sellers will ever receive to purchase their used mobile homes.
Mobile home sellers may be more interested in building rapport.
People are people. Some sellers have the gift of gab, while others are very direct and to the point. You will have 10-minute appointments with traditional site-built single family homes and also with regard to mobile home sellers. Conversely, you will also go to many 2+ hour first appointments with single family home sellers as well as mobile home sellers. One strong correlation is the more motivated and emotional the seller, the longer the first appointment with a seller may go. This is often due to the fact that we investors will be listening to problems the seller is currently struggling with in regard to selling their property, as well as what these sellers are looking for moving forward.
While there are a variety of motivated sellers in any given market, mobile home sellers may have a greater need to keep communicating with you and building rapport so you are encouraged to make them a purchase offer(s) on their properties. Simply said, a high percentage of mobile home sellers will be happy and eager to build rapport with you simply because you are one of the few people willing to listen and help in their situation.
They may be thriftier.
This bullet point is certainly debatable; however, I have heard many of my mobile home buyers comment and smile gladly when they realize they are purchasing a good quality used manufactured home for less than $30 per square foot, compared to the single family home they just downsized from, where they were $100+ per square foot. While every purchaser of a mobile home is different, this certainly can add to a owners’/sellers’ mindset when it comes to selling and/or buying their properties. Depending on the sellers’ mindset, this may affect the sales price and flexibility of the sellers positively or negatively from an investor’s point of view.
In conclusion, every bullet point above can be disproven and shown incorrect in certain cases. Every mobile home seller is different, and no two deals are exactly alike. People’s needs and motivations change regularly, while homes, rules, and demand vary from location to location. One thing is for sure, assuming you live within the continental United States, there are mobile home sellers in and around your area who are confused as to why their homes have not sold yet and why more people are not coming to look at their properties for sale. These sellers may become frustrated at their confusions and may be eager to hear from a local mobile home investing expert who knows about the local market and can help concerning their properties.
Mobile home investors: Anything you’d add to this list?
Let me know with a comment!