Mobile home investment

[Brandi Bryan]

Hi y'all!  I want and need YOUR opinion. There is a mobile home across the road from my mom, has been sitting empty for about a year now, the people that own it lived there for a long time and own free and clear. I heard they were asking $3,000, motivated to sell because they have to keep up on the lot rent $300 mo/. This would be my first investment, was looking to buy and hold it for a long time. Rent it at $650 includes lot rent and have a $350 positive cash flow. The place does need power washed on the outside, a small piece of skirting and back steps. No big deal. 

What are your thoughts? 

Thank you! 

[Daniel Derrick]

This can be a good deal, but personally I would not go the buy and hold rental route. Depending on the park and possible ARV, I would try to get them down to $1500-$2000. Put in a bit of sweat equity and try to sell it for the going rate in the park. Usually that's going to be 15K or more for a rehabbed mobile, depending on specific park and your area.

Instead of treating it as a rental, sell the home and hold the note. You get the monthly payments for 5 years, you are not responsible for lot rent and you reduce your liability for fixing things that go wrong with it. At that point you are simply "the bank."

That's what I would do.