Need advice on buying a small mobile home park

[Jared Lundy]

I am fairly new at Real Estate Investing. I have come across a potential deal for a trailer park in the Carthage, MO area. Some out of state owners are trying to sell their 2.7 acre park for $84000. I went and looked at it last night and the park and the trailers on the park look pretty rough; It all needs to be mowed and generally looks uncared for. Currently there are 9 trailers on it and the rent is $1626/mo but owner pays water and trash removal. The owners say that there used to be around 30 mobile homes on the land so I am guessing there are or used to be hookups for that many mobile homes there.  I have a small list of questions that I am going to ask the current owners, but I wanted to have others thoughts on this as I head into it. Any questions that I should ask of the current owners or anything that I should look at or be aware of as I look at this mobile home park? 

$1626/mo feels low for 9 trailers but from the looks of the trailers that are on there if I bought it and raised the lot rental then I would probably loose the majority of the current renters. 

This is pretty much all the info I currently have. I just got the lead last night so I am just getting into this thing. :)

Thanks!!!

[Brenden Mitchum]

Hey @Jared Lundy, welcome to the BP Community!

Sounds like a ton of work but potentially also a great deal. Here are a few questions to make sure you ask, if you don't already have 'em.

1. Are the homes tenant-owned or park-owned? Probably tenant-owned since the total rent is so low but you never know. Regardless of the answer you will want to have an idea of the age and condition of each. You won't be able to enter them if they're tenant-owned but you very likely will end up with a few (or more) on your hands if you take over and raise rents. 

2. If they used to have 30 homes, why are there now only 9? Finding out if this is due to poor management or demand will be important. You can run a test add if you're not super familiar with the market. 

3. Are there hookups for all utilities at each vacant lot? Obviously, you'll want to verify during due diligence.

4. Public or private utilities and what are the sewer/water lines made of? Recent repairs?

5. Do they have an onsite manager?

We have several parks in MO so feel free to reach out anytime if you have additional questions. Good luck!