Buying a RV/Mobile Home Park
I have made an offer on a RV/Mobile Home Park and hope to start my due diligence period soon. The park has 40 sites, 11 park owned mobile homes and 25 RV sites. 3 sites are non-performing. Most residents are full time. The park water and sewer are well and septic. I calculate a $140,000 NOI and they are asking $1.4mm thus resulting in a 10% CAP. The numbers are attractive but I'm looking at them from a brick-n-mortar landlord perspective. I have read that there are pitfalls in this investment type that could ruin you. I've read about extreme property tax increases, tourism tax, infrastructure issues, Health Dept. & DEP issues. Can anyone shed some light on what to watch out for and how to go about minimizing the risk during the due diligence period?