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Updated over 4 years ago,

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7
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0
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Erik K.
  • Real Estate Professional
  • Escondido, CA
0
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7
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Mobile home parks evading rent control, using vacancy decontrol

Erik K.
  • Real Estate Professional
  • Escondido, CA
Posted

I know that many investors buy manufactured housing parks precisely to avoid the cost and burden of owning the home structures. Suppose, however, that a well-funded buyer has a different strategy: gradually acquire all homes in the park and rent them out at full market value.

In some locales, rent control begins when someone buys a manufactured home and moves in (agreeing to whatever rent the park owner currently asks), and ends when the homeowner vacates.

In that situation, it seems that park owners may raise new rent so high that vacating homeowners would find it impossible to sell the home (except maybe at a ridiculously low price). Then the homeowners must acquire a new place for the home (if that's even feasible) or sell to park owners at any price demanded. If the home is removed, park owners could purchase and install a new home.

Rent control does not apply to homes owned by the park owner. So, whether or not the home is removed, the park owner gains something and the homeowner loses greatly in terms of money and aggravation.

In practice, does anything deter park owners from inflicting huge losses on homeowners in this way?

I'm focused on parks in California, but this could be a danger for homeowners anyplace where rent control ends when the homeowner vacates.