Small Mobile Home Park Value

[Clayton Smith]

Hi, My mom has a small mobile home park in Tuscaloosa Alabama that she is interested in selling but wants my help finding the value. I have several SFH rentals and am confident running the numbers in our area but do not know much about a mobile home park. Any help would be appreciated. I have said that getting a professional appraisal is probably the way to go but just wanted to get a few thoughts.

The park appraised for $350k in 2013. It is small park and sits on 4 acres of land that is adjacent to land that has been or currently being developed for nicer neighborhoods on all sides selling in the mid to high 300s. The land has value but I am not sure how to factor it. So I am just going to give a breakdown of the numbers for any advice. She has 7 mobile homes that she owns as well as a 3 BD / 2 BA house located onsite. She does not have any lot spaces for rent. Also she takes good care of the properties and I have actually gotten on to her about fixing constantly spending money on maintenance when some of the work is not necessary in my opinion. In other words it is a turn key operation so you will not have to spend much money on turnaround items. 

Current rent roll - $6,025 month

Insurances / Taxes - $635 month

Dumpster - $ 135 month

Grass / Maintenance cost - $ 750 / month average. 

So a cash buyer could expect around $54,000 a year NOI.

What would be a appropriate cap rate for this kind of venture? 

[Ola Dantis]

@Clayton Smith 

You should connect with @Charlotte Dunford, she is a master with Mobile Home Parks.