Mobile Home Park Mixed with Residential - Financing Nightmare?

[Justin Cecil]

Hello Bigger Pockets!

I am a real estate agent who also works a full-time day job. Looking for my next investment property, I found something very intriguing. By intriguing, I mean a complicated puzzle filled with potential. Any advice, strategy, tips and tricks would be greatly appreciated.

Please hang in there with me on this because the details are a bit convoluted. There are 3 parcels in a trust that the seller(s) would like to sell together.

First parcel features a 2 bed 1 bath 864 sqft unit zoned multi family 2-3 unites. In addition to the structure, there are also 2 mobile homes that are not on foundations but are connected to public utilities(sewer/water/power).

Second parcel features a 1 bed 1 bath 480 sqft unit zoned multi family 2-3 unites. Similar to the first parcel there are also 2 more mobile home units also connected to public utilities (sewer/water/power).

Finally, this is a little tricky as the listing information does not match the tax data. MLS says it is a 2 bed 2 bath 1,314 sqft home. The tax record says it is 2 bed 1 bath 1,258 sqft unit. In either case, there is enough square footage to create a 3 bed 2 bath home. Yay for hidden equity! Also, this third parcel has another 2 mobile homes with no foundation but connected to the public utilities.

This is where it gets interesting...

Each mobile home space rental is $550/month for a total of $3,300/month plus utilities. The units also bring in a combined rent of $2,840/month. The total monthly income for all three parcels is $6,140/month or an average of $2,046 each. These numbers are current numbers and are low for the area. The average rent in this area is $1,309/month for 767 sqft for apartments and houses. Average space rent for mobile homes are closer to $750.

The property is definitely a fixer. The pest report shows about $20k worth of section 1 and section 2 items across the three units. The mobile home spaces are in desperate need of clean-up (trash, bushes/weeds etc). A true diamond in the rough.

ARV I feel is about $255/sqft. for the units. I've never comp'ed Mobile Home parks so maybe Brandon Turner will chime in but mobile home units in the area are going for $56/sqft.

Not sure what financing option I should use to get this property into contract? Seller financing may be an option but not yet discussed.

My goal would be to buy and hold long-term. Originally, I thought my next investment property was going to be a two-year BOORRR (Buy Owner Occupied, Renovate, Refinance, Rent). It is a two year process but I am working full-time (love my job) while also working as a real estate agent (love helping friends, family, and referrals) and you can't beat the owner occupied financing.