7 unit park for sale near me - Willing to assist

[CJ Witmer]

I'll be very up front, I don't have any experience with mobile homes besides what I've listened to on BP podcasts, but I'd love to learn more.  :)  I'm not sure on the numbers here, but wanted to bring it up because it's out of my price range, but I'd love to be involved as boots-on-the-ground for this and maybe work out a mutually beneficial situation.  It's about 25 min. from me.  Let me know if anyone is interested in running some numbers or if I could help anyone out who might be interested.

http://www.realtor.com/realestateandhomes-detail/2081-Fort-Loudon-Rd_Mercersburg_PA_17236_M34840-11807#photo0

[Account Closed]

@CJ Witmer Problem with parks is they are not like SFH where there are thousands around you. Though its only 25 min from you , its rare it works out that way so don't let them carry too much weight.

Without knowing any of the details, there is no deal here in my opinion. Quick reasons, being so small you typically want to hedge that with purchase price since there aren't a ton of buyers. Its on well ( but can be good if city water is available ). Ability to expand is nice but for this not worth a premium especially since you will only be at 14 spaces. The park owns all the homes. Lets say lot rents are 300 ( could be less or market could be more) at 9 lots so 2700 a month annualized gross of $32,400 and using an expense ratio of 50% ( could be more once you check actuals) since its really a small park about 16,200 in NOI. Then if its a 10 cap 162k but 12 cap about 135K. Then wholesale value for homes ( they look like they might be rounded roof metal 80s home from satellite image). Lets be generous and give him 5 k per home ( could be less...) so 35k for the homes on top of a 10 cap ( which may be overpaying for this property.....) So 197k. You have the SFH as well so you will have to factor in something on that depending on condition , rent etc. But SFH in parks aren't worth as much as retail houses and not as desirable. so lets do an arbitrary 50k and do 247 k for the deal. The deal might be worth about 200k less than they are asking . So you really don't want to waste your time but know you have a thought process of why. They are advertising as a 12 cap. What they might be doing is saying the mobile homes rent out for 700 and then understating expenses . This is called capping the homes. Its a great way to get someone to pay 20,000 for a home that is worth 5k or whatever. If you can get them to do it 7 times over ...... So they are just saying that but you have to break it into two parks, wholesale home value as well as lot rent income/expense.

Additionally, i noticed that in the satellite image appears to be 11 homes but they have 7POH and 2 TOH . So maybe verify if homes are getting pulled or they are abandoned etc.  Its not enough to change the deal on this one but something to consider.  

And finally financing will be tricky.  Additionally, remember if you go that small , the lender pool is bit more limited but thats secondary to the rest of this stuff.