Mobile Home Park Buying Criteria - Going Against the Grain

[Steven Nguyen]

Hello BP Community,

It seems like most investors want all tenant owned homes, city water/sewer, and low vacancy.  For the beginners starting out, would it be wise to go against the grain and target the mobile home parks that nobody wants (i.e - park owned homes, private utilities, high vacancy)?  If these problems could be solved, there seems to be high upside and a lot less competition with the bigger investors.  Let me know your thoughts.  I am looking to grow my mobile home park portfolio.

Thank you.

Steven

[Steven Nguyen]

Quote from @Erik Checkur:

The biggest issue I have seen from my experience can come from the lending side of these deals. There are typically only a few companies that can actually lend on mobile homes. As soon as you start getting into land leased property, manufactured vs mobile homes, things get a little tough with lending. Many times a lender will need to do a report on the structure of the home to make sure it is properly affixed to the ground. And sometimes, depending on your goals, they can be hard to sell later on since there is a small niche of people that may see a mobile home on leased property as their best move going forward. 

I think the best thing you can do is find a realtor or someone who has connections in the community. That's where you will find off market opportunities through word of mouth and be able to get into multifamily units without the crazy competition.

 Thanks for the insight! Yes, most of these deals would need seller financing then partnering with a mortgage broker who specializes  in mobile home parks once the park is stabilized to explore other options. Sometimes there are smaller local banks willing to finance but as you can imagine rates wouldn't be as competitive.  I am a buy and hold.