All Forum Posts by: Belinda Lopez

How is that each site only generates $1100/year?  That's $1100/7 = $157 month cash flow.  What is the monthly lot rent?  Keep in mind that owners under-report their time for management and maintenance.  Would have to look at all the financials to analyze it more.  Why is he selling?  if he wants to retire then how is he willing to stay on and still do all the work for only his rent costs?  Right now he does that and makes any income from the property.

The "No New RV Parks" is an insane attempt by lawmakers to regulate what property owners can do with their own land.  Worse, it hurts the people who really need that price of housing!  If there were a large enough lobby, someone needs to challenge that in court as housing discrimination.  We've seen it time and again and it only leads to folks living in some horrible, low income apartments or rental homes instead of allowing folks, who fully choose to live in RVs and manufactured home a safe, affordable Park to live in.

It also makes prices on existing Park prices go up and many deteriorate b/c they know their guests have no other choice.   

Does the park own all those homes? Does the $1275 include rental on the homes plus the lot rent? What is the lot rent? why so many vacancies? Sounds like a very poorly run property which could be a good opportunity for someone but I would only value it based on lot rent and/or land value. Renting homes is a very management intensive way to operate that kind of park. At lot value only, you get $250? $275?? a month for a pro forma gross of $2500. Times 12 = $30k times 50% (expenses) and you're back at $15k NOI. At a 10% cap rate, value would be $150k BUT that is a full leased park.

As-is value is $15,300*50%  (Gross*expense & vacancy factor) = $7650  at a 10% cap rate, total value is ~$76k.   So yeah, a $50k offer makes sense to give you room for a wholesale fee.  Be aware that most Buyers don't like buying these type properties via wholesale b/c they need to be able to do their own due diligence and be able to negotiate directly with the Seller. They would need at least 60 days for due diligence and would want to have all utilities inspected, talk to local authorities to see if the park is operating in compliance with all state and local rules, etc.  

You might want to locate buyers who will pay your fee directly so that they can work directly with the Seller.

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Hi Angie,  lots of factors to consider for this one.  Let's look at the numbers reported.  Are these actuals or just his estimates.  Is he willing or capable of producing two years of CPA approved financials and tax returns?  If you don't have those, any sort of bank financing will be difficult.  Going off those numbers he is claiming to a net revenue of ~$216k.($500*45*12= $272k plus a 10% vacancy = $243k minus  $100*45 expenses ($45k) = $198k

To make is simpler take $272k*50% = $136k NOI. So this could be a great deal at $750k. Happy to setup a call to discuss further.

Will he owner finance?  Why is he selling if it's doing so great?  public water & sewer?  does he self-manage?  We've found that many owners completely underestimate their true expenses and their own time to manage such properties.  Does he take a salary?

Sounds good so far, keep going on the due diligence.

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Galveston won't let you live in RVs so you might be talking about Crystal Beach, Bolivar and Gilchrist on peninsula.  Those lots are going from anywhere from $12k - $24k.  There are tons of them available and they don't seem to move very fast.

Where is the RV located now? How big is it?  Is there any warranty left?  I am buying an RV Park and plan on having an area where folks can park and sell.  Do you know what the book value is? You could easily do a wrap note and sell on terms since so many folks can't get financing.  You can also pay someone to move it for you.  I was looking at this option for a friend of mine as it's not too expensive. You can also rent a truck uHaul that you can pull it with. What is the make and model?

I think you'll be able to find an option that will work for you.  

The other advantage in Galveston is that the city has done a great job of hosting events throughout the year.  This means well located rentals can do well all year round instead of just the busy summer season.  I am just selling an AirBNB property (need the funds for another investment) right on the Seawall that was not in a floodzone!  House is over a hundred years old and never been damaged from a storm.  Not saying it couldn't be but it all comes down to location.

I went down to Rockpot a few months ago to check out a "fortified home" from Deltec that is Cat 5 rated.  I may build a few of those, including my personal home, to use as short-term rentals.

Be sure to check with compliance issues in Texas City.  They may not let the new owner replace the trailer and it might even be illegal to have it there now.  We were looking at what was advertised as an RV Park near downtown and when I started my due diligence on the property, the city manager told us in no uncertain terms that he had been trying to get rid of the park for years.  It was not in compliance with city ordinances and a new owner would not be able to get a permit for a new park.  

It's a bit tricky because you need to find out before listing the property but you don't want to get the current owner into trouble so do not give them any specific information if at all possible!  Check out the city ordinances at municode.org to see what they say about mobile homes not in a park.  Check the land use codes for the plat, etc. If the home is older than 1976 then it probably not going to be able to be replaced or moved.  We don't put any value on most used mobile homes when we buy parks but it all depends on the quality of the home and year built.

Is the trailer personal property or real property?  Mobile home or manufactured home?  current statement of location?  taxes?

Could be a great deal if priced right and it's in compliance.  Good luck!

Galveston is a great STR location. The City and Chamber of Commerce have done a great job of promoting conferences and events (Triathalons, Dickens, Biker Weekend, etc.) to keep rooms filled in the winter months.

We did great with a property just a block from the Seawall that meant it was actually in an X zone and no flood insurance required. Windstorm is another matter.  I agree the higher end homes and rentals are a different breed than Condos or older home that might be close to the seawall.  East end and West end are two totally different markets.

Don't fall for any ads that say "close to the beach" -everything is close to the beach and it really is block by block whether it's a safe area or not.