MN STR Cabin Manufactured Home (Mobile)?

Question

Hello BP!

I'm looking at getting a STR in northern MN (Brainard area or just North of there). There are several cabin options that are much cheaper because they are manufactured homes. Some after obviously a manufactured home and some you wouldn't be able to tell if you weren't familiar with them.

Does anyone have experience whether these would rent similar to other traditionally built cabins with similar beds/amenities? They are not in mobile home parks.

The only comparables I found in the forums were people over in the Carolina's, and they said they still worked.

Any thoughts are appreciated.

Thanks!

Richard

Also, My primary home is a manufactured home on a permanent concrete basement, so I'm familiar with them and can see this as being a niche for me.

Richard Appleby · Answer

Thanks for that info @Patricia Taveras! I am running my numbers at 1/2 the rental cost AND occupancy that AirDNA lists for my area and I would still cover my costs and be able to use the place with my family, just in case the manufactured aspect demands a lower rental rate.

Caroline Gerardo · Answer

There are a couple of foreclosures in Brainerd manufactured homes, one geodesic conglomeration that is super expensive. What attracts a vacationer to that area? Paul Bunyon Land is not a draw. Speedway during season? You need to make the cabin appear to be a fishing heaven, have games and books for those who want to be cozy by the fire but manufactured generally no fireplace. To make a manufactured home appear desirable in photos and a video is going to take a talented stylist and then you need to deliver on the promise to get reviews.

Comps in Carolina's ARE NOT COMPS.

Manufactured generally do not last as long if on a pier and post foundation or augers. Financing is more expensive and seller has to file the 433A and meet county codes which most will not have completed.

Who is going to clean them and set up?

Mike Eichler · Answer

A lot of times these can go very well as it's a much lower cost of entry than typical homes and nightly rates can typically be quite high relatively depending on which area you are in.

One thing to be careful of is regulations I would check many things, including Township/County rules, and regulations as well as checking HOA rules if they apply. Some of this governance don't allow STR at all or is heavily restrictive, so just be careful before you act on anything, I love the idea though.

Hope this helps, let me know if you have any more questions, I am happy to help.

Live Free,

Mike

Richard Appleby · Answer

Thanks @Adam Tafel.

I'm familiar with the challenges of financing that I went through with my primary. Short term this could be an issue - my target price is also at a lower point so if I can't rent it I could re-list this summer and not lose (too) much on the deal. I plan on no appreciation of the home, only the property spot on the lake - thus buying for the nice lake and land. Long term plan is to save the revenue and replace the mobile home with a stick built in 15-20 years that will appreciate and can be passed down to my kids - but was financed by the STR model.

It is not being marketed for STR or AirBNB, but all the ones I am looking at I am viewing as that.

I will DM you for more specifics on your STRs. Thanks!

Adam Tafel · Answer

Your rental rates in the short-term might not suffer if you what you say is true about not being able to tell the difference.. Most downsides will be over the medium/long-term - what sort of financing, appreciation, and ease of sale downsides might you experience in the future?

Also - is this particular property being marketed as a "short term" or "vacation rental"? We are seeing plenty of sellers/brokers advertising "vacation rentals" on the MLS as investment opportunities - when in reality the only thing that separates a "vacation rental" from a "cabin" is maybe 5-10k in furniture. These brokers often charge a considerable markup by offering financials and rental data - which is certainly helpful but often not worth the increased price.

I've been running Airbnb rentals in the MSP area for the past 7 years or so, feel free to reach out if you'd ever like to chat.

Patricia Taveras · Answer

@Richard Appleby

There is an Airbnb host in my area who rents out a 3 bedroom 2 bath singlewide and is at 96% occupancy for January. (We're  in NC.) It's not in a park. It's cute. He does charge considerably less than other 3 bedroom homes. Looking at his occupancy, he might could charge more than he does.