What Would Cause You To Pass On A Free Double Wide

Question

I have a potential deal with a local park owner for a 73 double wide. It would be my first time working with a mobile home and was wondering what sorts of things would be your conditions to take it on.

Physical condition, park fees, title condition, etc.

I'm actually fairly excited about this deal if I can make it work.

Physical condition, park fees, title condition, etc.

I'm actually fairly excited about this deal if I can make it work.

Leslie A. · Answer

could be a great opportunity.  Like the others said, get the details of costs for lot rent and repairs. See how much you could sell or rent it for.

I have 8 rentals in a mobile home park and the park is quite nice, so I disagree with those who say only lowlife parks allow rentals.  In fact, I've been told I could rent homes in some of the nicest parks in my area.  So, a lot of the negativity is hearsay that gets passed around

Not discounting those here who have had bad experiences.  But all types of investing has it's downsides and failures

Dan Mackin · Answer

@Eric F. & @Curt Smith

Thanks for the info.  I was considering it due to the ridiculous cost of housing out here.  Even getting a lot in a park is difficult so it seemed like there was good potential even with a rehab.  I just spoke further with the park owner and it won't work out.

Curt Smith · Answer

Homes in parks present a bunch of problems.  Read past posts here on why not to do deals in parks.

- does the home come with back lot rent?

- will you owe lot rent from day one while you fix it up and market it?  You could be oweing $300/mo while you fix up and market.  You'll not make money in the first year easily.   Free to get, $10k++ to fix up, $1200 lot rent (3 months) to fix and market, then your paultry positive cash flow above lot rent and setting aside reserves for damage and turn over.

- 1973 is VERY old.  Have you seen the inside?

- Will you own the septic system it sits on and the maint?

- These older homes where plumbed with CPVC or PVC.  Which get brittle and need replacing.  PEX the best material for plumbing in mobiles is more recent.

- A long line of ifs for me to take a few home in a park.

- Will the manager let you manage your own rental?  Will he let you sell it?  Meaning if you bring a candidate will he approve them quickly.  He may just want you to fix it up, then not approve your applicants.  Forcing you to give back the fixed up home.  You think this sounds preditory and not possible?  Parks and managers are an unbelievable bunch when they go bad.  You need to be very very sure your effots and money will not be wasted.

Bill Neves · Answer

Most areas will not allow older than 1976 to be moved. Most cities/counties won't give a permit to move that vintage. Haulers can't legally move them. So leaving them in the park is the only option.

One question I always ask the Park Manager (PM) is 'can the unit stay in the park?' Sometimes as mentioned, they want to upgrade the park so will give it to someone to move.

Just double check.

Also I'd steer clear of them unless you're comfortable with them. I'd recommend to do at least 5 or 6 newer ones to get a feel for the business before venturing into deeper waters.

Good luck with it and....

Have fun!

Dan Mackin · Answer

@Natalie Kolodij - There was no plan for me to actually move it.  I was working on convincing the owner to let it stay in place.

Jeffrey Vandagriff · Answer

Someone correct me here, but if it's older than 1976 the possibility exists for asbestos insulation. So I was told anyway. Most parks around here in Oklahoma have an age limit on homes. The park might just be wanting to move it out to update the overall look of the park.  There might be nothing wrong with it other than its age. You just never know, until you know...

I met guy who got an old mobile for free and let the local volunteer fire department burn it to the ground for practice. They gave him some receipt for his donation and he was able to use that on his taxes somehow. I thought that was clever, but not sure if his story was BS.

Bill Neves · Answer

I'd look at it. I have done several older than 1976.

In addition to plumbing - Aluminum wiring is in most.

In my area, you must meet code requirements for older than 1976, in order to sell:

1 - Egress windows in bedrooms.

2 - Sheetrock around heater and hot water heater compartments. Also within 6 inches of open cook areas = cooktop and exhaust vent. Ovens are enclosed so exempt.

3 - All plugs and switches must be replaced with certified aluminum ratedOR needs a non corrosive grease (available at any Home Depot, Lowe's, etc.) on ALL plugs, switches, light connectors. (If you hire it out it's quicker to put new.)

This can run several hundred to several thousand $.

Also if it's free from the park ALWAYS ask for rent moratorium until sold. Like mentioned above if it were a screamin' deal the manager/owner would likely do it themselves.

Have fun!

Natalie Kolodij · Answer

OOOOOO

it needs to be removed from the park????

Ya, I'd pass on that.

There are 10+ free mobiles on CL here at any given time to be moved. It costs too much and if its older most movers won't do it.

I never move them.

Dan Mackin · Answer

@Natalie Kolodij - I was not able to go look at it and the park owner is adamant about removing it from the park so there isn't much I can do.  In my area of Colorado there really isn't a cheap park.  Lot rents run 500+ minimum and are usually at full capacity.  I am going to keep an eye out for others as I continue forward.

@Mike Baker - Mold was a concern of mine with the home from the pictures.  I had some roof leak problems and it was hard to tell where it had gotten into.

@Blair Poelman - I was going to work with the park owner on the logistics in terms of what was still owed.  The park is a mid range in terms of ownership.  In the city it is 1 of 3 parks and definitely is in the middle of the pack in terms of quality.

@Leslie  A. - Personally for me I couldn't do mobile rentals or at least that's how I feel right now.  I'd much rather rehab them and do a seller finance on them.  Not all park owners are bad, but I would have issues knowing that they could change their mind on terms.  Plus lot rents here are getting ridiculous and aren't slowing down.  Everyone from Boulder is getting pushed out of the "Bubble" and it's shooting up prices in the surrounding area.

Blair Poelman · Answer

First of all - nothing is ever free.  There's a catch somewhere.  If there was no catch, the park owner would take the unit.

Mobile homes are different in that they are not always "real estate".  They can be, but they always start as personal property - it's a vehicle with a VIN, not a parcel ID.  Often times it can be converted to real property, however you then start paying real estate taxes instead of property tax, which is usually more expensive.

My experience is that any park I would feel comfortable doing a deal in will not allow rentals (their way of preserving the quality of the park with some pride of ownership) - in that case it would be doing an asset flip, or a seller financing the asset.  If they do allow rentals I probably wouldn't deal with it.

The rehab of a mobile is slightly different than a house - it's usually not on a foundation and you're dealing with different materials, but overall there's a lot of similar aspects.  You're still getting your supplies from home depot...

If it's in okay shape, there's no back rent or crazy fees that come with the free unit, and if the park isn't a total dive, and the monthly fees are reasonable, and it's not haunted or something crazy like that,  I'd seriously consider it.

What Would Cause You To Pass On A Free Double Wide

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