Help with Mobile Home Park Valuation (partially developed)
How would you value this and determine how much to offer?
I am hoping to make the move from residential (househacking and BRRRR) to mobile home parks. I came across what looks like a solid deal. I have thought of 4 ways to value it, but curious how other would approach it. The long term play would be to sell off the mobile homes and build more pads to bring in more tenant owned homes.
Facts:
- 30 acres total
- Front 10 acres have 9 park owned mobile homes, all rented out, dirt road, no amenities
- no tenant owned homes
- Back 20 acres are raw pasture land
- City water and electric, sewage on septic
I have thought of 4 Valuation Approaches
- Method 1: Sum the assets (30 acres land + 9 mobile homes)
- Method 2: Pure as is Cap Rate (Value = current NOI/Cap Rate)
- Method 3: Value the Front using Cap Rate + Value of Raw Land in back
- Method 4: Assume homes are sold, then value the Front using Cap Rate (estimate NOI using market lot rents for the 9 lots) + value of raw land in back + Proceeds from sale of the 9 mobile homes