Mobile home depreciation

[Xin Z.]

Hi, I have a mobile home on about 2 acres of land.  It has been completely rehabbed with new AC, water heater, windows, flooring, paint, appliance, etc.  It was made in 1999.

Now I am trying to decide whether I should rent it or sell it.  It is located in a convenient location, so renting shouldn't be a problem.  My concern is the depreciation of the mobile home.  After a few years of renting, if the value depreciates a lot when I sell it eventually, then my cash flow will be much smaller if any.  I'd like to hear from experts here when a mobile home is "too old" and start to lose its resale value.  Any comments and advice is greatly appreciated.

[Bill Ayers]

That is a very complex question actually. But to keep it simple... In my opinion the biggest risk of depreciation in a mobile home is the wrong renter. I have seen some homes just recently that were destroyed within months by tenants. For that reason, I only sell them. I do  not want the hassle or potential risks of owning mobile homes. So, selling it right away is my strategy.

Here is a more direct answer to your question about a mobile home being "too old".  I think of them more like used cars. If it is very well taken care of versus abused, it keeps its value, if not, its value can easily go to zero.

I hope this is useful.