Can it be profitable to invest in homes much greater than $5k?

[Orlando Paz]

From an investment perspective, can it be profitable to invest in homes substantially greater than $5k? It seems that an investment costing approximately $5k is the max standard among MH investors to make a good ROI.

I recently came across a MH that is FSBO. It was manufactured in 1983, but it's very well kept. It has also had some upgrading throughout, and a new AC system installed. The home is nestled in a small tree lined family park, which also happens to be very well kept. Overall, it's a hidden gem. The owner is asking $27k. The lot rent is $295 per month (not bad!)

In my mind, this looks like a place that I would consider buying (if I had the means). At $27k, I can only think of making some minor upgrades then selling it for about $45k. The only other strategy I can think of, would be to simply rent it indefinitely. According to information posted by the owner, they estimate a value of $30k. According to Zillow, recent comparables are about $70k. If I choose to rent, then the average rent for such a MH would be about $795 (According to rentometer)

Not sure if I am running on ambition and/or emotion, but I am thinking that there could be some potential.

Any thought’s or suggestions would be appreciated. 

[Rachel H.]

If you decide to purchase the home, just be sure you check everything. Older homes tend to have particle board. It can be repaired but costly for the long-term. 

Also, check the plumbing. If you have the "grey pipe" (I did a write-up on this awhile back), you'll have to replace over the years. There was a recall on this material which is why it's no longer used. 

Everything can be fixed. It just takes time and money. If you have a team of contractors who can help, it will make things much easier for you. With the amount of fix up work involved in this industry, this is what inspired me to write my last book on the subject. 

Best of luck!