Chance to purchase a double wide is it feasible?

Question

Lee Schaeffer · Answer

Hey Shane, If I were considering this deal, I would work back to get the offer-in price. If I were going to rent it long term to a tenant, I would check the rents on Zillow.com for similar properties in the area. If the fair market rent was $750 per month, and I wanted to get my cash back in three years, I would offer $750 X 12 X 3 = $27,000 less the cost of rehab and all other expenses. If during the three years the rehab cost was $15,000, and maintenance was $2,000 and taxes and insurance were $1200 per year X 3 = $3,600, my total expected cash out of pocket after being the owner would be $20,600. So, I would offer in at $27,000 - $20,600 = $6,400. In order to get this seller to accept my offer, I would show him these figures. If the seller does not go for the deal, I would move on.

Joe Cummings · Answer

I never moved a house trailer, but I've moved lots of big office trailers. Old ones don't stand up to moving well. And what you are left with is a big pile of trash to get rid of.

Contrary to popular opinion, there isn't enough value in the scrap metal to pay for the disposal of the trash.

Lee Schaeffer · Answer

In the KC area, there are mobile home parks that have lot rents of $290 to $400 monthly and offer to move the mobile home for free provided that the mobile home stays there 5 years or more. There are lots of three bedroom, two bathroom mobile homes that can be bought and remodeled for $5,000 to $15,000. The way I do the transaction is for the tenant to become the owner after renting for 12 years following the provisions of our Agreement.

This is an example of a current offering. The tenant pays the rent of $433 or more per month, the $145/mo. lot rent, the $20/mo. water fees, the $20/mo. sewer fees, and the trash fees which are included in the lot rent to me in advance so I can be sure that the tenant is current on all park fees. The tenant does all the repairs and maintenance. This is able to be negotiated because the tenant intends to rent the mobile home for 12 years to become the owner after the 12 years and accepts the responsibility now to keep the mobile home in good condition. Also, the mobile home is remodeled which gives the tenant a good comfort zone. My insurance is about $20 per month and my property taxes are about $20 per month. The end result is $433 X 12 X 12 = $62,352 income less $20 + $20 X 12 X 12 = $5,760 expected costs = $56,592 net before taxes. If the total remodel costs were $15,000, then, the gross profit would be $41,592. The time to return the $15,000 cash investment is 2.9 years.

LeeSchaeffer@yahoo.com

Scott E. · Answer

Your numbers don't work around here.  750 per mo. + 200 lot rent = house rent around here.  Then OP would be on the hook for lot rent regardless of any lease between him and tenant.  + Cost to move home, because no park owner around here is going to fork over money to move a singlewide, much less doublewide.  Maybe 6 months rent if lucky.  Many parks around here don't even have doublewide lots.

6000 move and setup, maybe cheaper, but doublewide is more work than single

+   10000 rehab, can't afford to spend much here but would probably make it with lower grade materials.

+    20000 land cost, again maybe cheaper, but maybe lucky to find this anyway

+    5000 septic and driveway.

41k, not counting any permits.  And you haven't bought the home yet.

Local doublewide/land for sale (local to me, I suspect OP is similar)

That could probably be had for 50-55k, maybe less if you're paitient.  I think my area is probably similar to OP.  10-15k for home.

OP, not trying to talk you out of a deal at all.  I think finding a foreclosed land/home package may be the easier way to do it.  It just seems like a lot of work.

Lee Schaeffer · Answer

In the above comments, I was thinking about going to a mobile home park and have them move the mobile home at their expense. I would also, rent it to a tenant and have them pay the lot rent and all the increases as well as all utilities and all increase. I usually rent the mobile homes to a tenant and after renting it for 12 years, I deed it over to them. When I do this, I usually get a tenant that wants to become the owner and will usually keep the home in better condition than just a tenant. Also, the tenant wanting to become the owner, usually does not object to paying for the lot rent and the repairs and utilities. Best wishes Shane!

Scott E. · Answer

I understand it costs around 2500-3000 to move and setup a singlewide in eastern nc (extrapolate from that what you will).  Highly dependent on the mover.  Like everything else, you get what you pay for.  Interior renovation can actually be more expensive than a regular home.  54" tubs, very shallow vanities, smaller than standard house doors are common.  I've put regular house tubs and vanities in a couple trailers, moved walls, it can be a hassle.  Trailer specific stuff can be more expensive than your typical house stuff, and lower quality to boot.

Not sure it's worth the trouble unless you can get it + land for a steal.  Doublewide land/home packages seem to be a common foreclosure around here.  One just sold after a week couple miles from my house.  Don't know the price but it was listed for 40k, probably 24x56 or 60 needed complete interior reno, on just over an acre of land.  I had little interest in it myself, I'm trying to get a few houses and get away from trailers, plus it was an odd shaped lot.

I'd be sure to check the zoning, + moving regs in your county.  A few years ago, you couldn't set-up a trailer older than a 94 or 96 in my county, not sure about now, I really need to find out.  As much as I want to get away from trailers, I have a few empty lots I may have to try to fill myself.

Chance to purchase a double wide is it feasible?

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