Switching from POH to TOH

[Jaime Felber]

Hi BP Community,

I'm looking for advice any pitfalls there might be when converting POH to TOH. I'm talking about a park which currently has a mix of the both. I want all current POH tenants to switch, and will require any new tenants to own their own home.

How is it done? What legal steps need to be taken, and what to do if a tenant does not want to switch?

Thank you!

[Roger D Jones]

Jaime

What is your financial pain threshold on this?  My point being what is so much is dependent on the age of the homes, what they are worth on the open at a fire sale discount and what are they worth to you?  Personally I am not a fan of sitting on a lot of POH homes for sale at the same time.  Get em sold for what you can as quickly as you can.  Your 'profit' will come when you own and eventually sell an all TOH park.

Here are some additional bullet points that I follow for your consideration.
1- The best buyer is the one currently living in the home.  You don't want to have to do a rehab on a vacant home to sell it.  Consider that when you make an offer to your existing tenants.

2- The price has to be very very attractive to your in park buyers.  They need to see it pencil significantly in their favor to make to buy the home outright. Total cost significantly below their current monthly rent.

3- If you have to 'give them' to the current tenant to get them off your books then do if it makes sense long term.  

4- Don't do purchase contracts longer than 18   months.  You don't want to take ownership of these things down the road if tenant flakes out.  

5- PEOPLE WHO LIVE IN MOBILE HOME PARKS ARE NOT STUPID.  Don't think you can trick them.
6- Some may not want to buy their homes for a lot of very good reasons.  Don't force them out just to sell the home.  Be patient as they will eventually move and you can transition then. 

7- Play the long game and don't step over dimes to save a penny.

Best of luck... just my opinions>

Rog