Investor · Grand Rapids, MI · Member since 2020 · 129 posts · 50 votes
Mobile Homes
Hey fellow investors, my name is Caleb, I am a local investor in Grand Rapids MI, and am trying to connect with other investors who have experience with mobile homes.
I would like to buy 10 of them within the next 5 years, to increase my passive income, what are some of the key differences in investing in mobile homes compared to investing in single family real estate?
Also is there anyone within an hour or two of me who is actively working on mobile homes, in parks or etc.?
Hey Caleb! This topic could require a longer post, but for brevity's sake I throw out a few pointers on the differences MH vs stick built SFRs:
- MHs are held via title and can be sold/transferred rather quickly. SFRs are held by deed or other legal document and require a formal closing. This closing is more expensive and drawn out.
-MHs tend to depreciate much faster than a house. They are like cars in the way of depreciation.
-MHs are typically built differently than SFRs, especially the older MHs. Older MHs have specific construction hardware (such as square-head screws) that aren't found in SFRs.
-MHs are significantly less expensive to get into, and often best cashflows that can be obtained on rental houses.
-MHs are affordable housing, which is in very high demand (and demand will only further skyrocket as inflation and other costs of living rise)
-MHs can be in Parks or on private land. Be sure to complete due diligence on the Park before purchase of MH; some parks have rules for rentals. Biggest one is they almost always require their own screening of your tenant. (thus, the tenant is screened twice - both by you, and by Park). Some Parks dont even allow rentals.
@Caleb Reits If you're looking to invest in mobile homes in parks, I'd say the key difference versus single-family homes is getting your foot through the door with the park manager and/or owner. Once you can get approval to do business in a park, that will set you up for success as others cannot do business there unless they get the OK.
Also, mobile homes are very specific and have their own parts when it comes to fixing them up. It's important to work with contractors who have experience working on mobile homes when it comes to fix up work.
One thing I do enjoy about the mobile home investing business is that it's a smaller community. Not many real estate investors are doing it compared to other asset classes such as single-family homes and apartment buildings.
Hey Caleb! This topic could require a longer post, but for brevity's sake I throw out a few pointers on the differences MH vs stick built SFRs:
- MHs are held via title and can be sold/transferred rather quickly. SFRs are held by deed or other legal document and require a formal closing. This closing is more expensive and drawn out.
-MHs tend to depreciate much faster than a house. They are like cars in the way of depreciation.
-MHs are typically built differently than SFRs, especially the older MHs. Older MHs have specific construction hardware (such as square-head screws) that aren't found in SFRs.
-MHs are significantly less expensive to get into, and often best cashflows that can be obtained on rental houses.
-MHs are affordable housing, which is in very high demand (and demand will only further skyrocket as inflation and other costs of living rise)
-MHs can be in Parks or on private land. Be sure to complete due diligence on the Park before purchase of MH; some parks have rules for rentals. Biggest one is they almost always require their own screening of your tenant. (thus, the tenant is screened twice - both by you, and by Park). Some Parks dont even allow rentals.
@Caleb Reits If you're looking to invest in mobile homes in parks, I'd say the key difference versus single-family homes is getting your foot through the door with the park manager and/or owner. Once you can get approval to do business in a park, that will set you up for success as others cannot do business there unless they get the OK.
Also, mobile homes are very specific and have their own parts when it comes to fixing them up. It's important to work with contractors who have experience working on mobile homes when it comes to fix up work.
One thing I do enjoy about the mobile home investing business is that it's a smaller community. Not many real estate investors are doing it compared to other asset classes such as single-family homes and apartment buildings.
We made a list of 10 parks and have been buttering up the owners, nothing yet, looking for ways we can add value to them. That way they want us to be in the park, just not sure what that looks like yet.
Hey Caleb! This topic could require a longer post, but for brevity's sake I throw out a few pointers on the differences MH vs stick built SFRs:
- MHs are held via title and can be sold/transferred rather quickly. SFRs are held by deed or other legal document and require a formal closing. This closing is more expensive and drawn out.
-MHs tend to depreciate much faster than a house. They are like cars in the way of depreciation.
-MHs are typically built differently than SFRs, especially the older MHs. Older MHs have specific construction hardware (such as square-head screws) that aren't found in SFRs.
-MHs are significantly less expensive to get into, and often best cashflows that can be obtained on rental houses.
-MHs are affordable housing, which is in very high demand (and demand will only further skyrocket as inflation and other costs of living rise)
-MHs can be in Parks or on private land. Be sure to complete due diligence on the Park before purchase of MH; some parks have rules for rentals. Biggest one is they almost always require their own screening of your tenant. (thus, the tenant is screened twice - both by you, and by Park). Some Parks dont even allow rentals.