"Property Banking" It's Safer and Pays More

[William Bratrud]

Investment Info:

Mobile home buy & hold investment.

Purchase price: $124,000

Bought this property a little under market value as an apocalypse bug out location and to get our money out of the bank early January of 2021. We are holding as values rise and now, seeing how Biden didn't usher in Armageddon we will likely resell once the equity margin hits a decent enough profit. Until then we have 5 mountainous acres in the woods on a well with plenty of wild game and a year round creek. Hey if we need it, its there.....

What made you interested in investing in this type of deal?

Prices are rising super fast in our market, properties are becoming out of reach. This one was listed at a good price for what it had to offer and at the time i was happy to have my money anywhere besides the bank. At worst we would have a tangible asset that produces 1k a month in rent and our money would be safe as inevitable inflation lifts housing prices to the moon. At best we have a property that can rent for 1K a month while in the meantime inflation takes our equity to the moon!

How did you find this deal and how did you negotiate it?

Found this one on Zillow, did a drive by and the agent happened to be there cleaning the place up with a couple other gruff looking guys. I had no idea he was the agent, Dude was scruffy with a big ol beard, dirty jeans and a flannel. I walked the property and made an offer on the spot, 3 hours later we had an accepted offer, 15 days later we closed.

How did you finance this deal?

cash

How did you add value to the deal?

We negotiated a little lower price after inspections but mainly this one is an equity hold as prices have already risen dramatically in the area.

What was the outcome?

Still holding, looking to sell possibly this fall or next spring, we will see what the market does.

Lessons learned? Challenges?

I don't think ill buy another MFG home in Tennessee, its just a bit tougher product to sell as they are less desirable, and the values tend to be much lower than a site built SFR. On the upside, if the market is hot and climbing like ours currently is moving capital from the bank to real estate can be a great move. At the end of the day i believe we will likely make at least 20% on our money once we decide to sell. Compare that with the 0.01% - 0.03% that most banks offer and its a no brainer.