Manufactured Home - Investment?

[Michael D'Alessandro]

Good Morning BP Community, I hope everyone is doing well!

I just came across a FSBO manufactured home on Zillow that was built in 1998 and is listed for $65k. I have been perusing through previous threads that briefly covered this topic. I wanted to get some additional thoughts from those who have much more knowledge/experience in this space. From what I gathered, manufactured homes will generally depreciate. This home was recently renovated (Brand new kitchen and Bathroom, Flooring, Painting, ETC) and has 2 beds and 1 bath.

I am currently a renter, so my initial thoughts were to potentially occupy for one year by qualifying for a low down payment and then rent out once the year is over. What are some thoughts on this? Can Financing be an issue?

Also, the description did mention that there is a lot fee, but did not specify the amount. Does this mean that someone owns the land? 

Thank you so much in advance and any other information would be greatly appreciated!

Best,

[Paul Shannon]

If there is a lot fee, that means you own the home, but not the land.  In this case, you are correct....you would be buying a depreciating asset and I recommend against it.  If you are investing in mobile home parks, you want to be the guy who owns the land, not the trailers.    

Alternatively, sometimes you can find manufactured homes that are erected in stick build neighborhoods.  The home, while manufactured, should be tied to a permanent foundation (as opposed to on wheels with a skirt around it).  In this case, the owner owns the home and the land.  Generally the manufactured home will appraise and comp out more closely to the single family stick-builds around it.  

The second scenario is a potentially viable investment.  The first is not.