All Forum Posts by: Bill W.

I strongly advise against moving a home on your first deal. It's a lot easier to learn in smaller increments than taking on a project of that size with so many figurative moving parts to begin with.

The quote you got to move the home (assuming it is just for moving the home) is really high. You don't mention where you are located but you could probably get it done for $1500. However, when moving a home you'll also have to pay to have the plumbing and electric hooked up. So altogether it's probably around $3500.

The home sounds like it is old. You didn't mention what year the home is but based on your description and that similar homes sell for $7k, I'm guessing it's a late 70s or early 80s. Homes that old are not worth moving because of their condition and you'll spend more on the move than the purchase of the home.

If by chance it's newer than I think, you might be able to have a park help pay for the move.

Based on the information you provided, I'd pass and find a deal with less headaches and bigger margins.

If I put a home under contract and intend to wholesale the property, what prevents an unscrupulous buyer from intentionally tying up the home, backing out of the purchase during the option at the last moment, and then buying it directly from the seller a short time later after it falls out of contract with the wholesaler?

If a buyer used the option period and backed out, it seems there is a good chance a wholesaler wouldn't have time to have another buyer purchase the home during the wholesaler's option period. In an event like that, couldn't the buyer purchase directly from the seller less the wholesale fee?

Other than getting a lousy reputation, what prevents a buyer of a wholesale deal from doing this?

You want to pay off the loan on your property early so you can use it as collateral to take out a loan on your property? Not sure what the benefit of that is. Why not just use money you have now and buy additional properties.

Also, what happens if you sell multiple properties in the portfolio? You pay down the principal but your monthly payments stay the same. You could get into a cash flow problem depending on how much you want to sell.

The home comps at $30k but you're excited about being able to buy it at $40k? Makes no sense to me.

Why not, at the very least, go buy a home for $30k and put a Sec 8 tenant in it?

An alternate I've seen to MH skirting is lattice. Doesn't look as good as vinyl siding or aluminum sheets but it's cheap.

Yes, it would reasonable to have terms like that but not for their asking price. Their asking price is so far off from its income producing value, I have a hard time imaging there is a deal here. The expense estimate that the agent is providing is a joke at 15%.

Before determining the value, you'll need to know how much of the $80,700 in gross rents comprise of:
A. Lot rent
B. Mobile home rent
C. SFH rent

Travis Elliott

A good formula to get a ballpark estimate, which is similar to Sabrina's but accounts for empty lots is: park value = (# of occupied lots x $lot rent x 60) + (# of empty lots x $lot rent x 30)

so you're looking at (14x$250x60) + (30x$250x30) = $435,000

Then you'd need to subtract the required repairs and add in the value of the home. The value of the home will be dramatically reduced compared to similar homes in the area since it is in a mobile home park.

Also, that formula would be used assuming you can fill the empty lots in a reasonable amount of time. If the lots can't filled because population is declining or there are other barriers, there isn't much value in an empty lot.

Texas Department of Housing and Community Affairs requires that you pass a 2 1/2 day course, pay for licensing fees, have a $50k bond and follow stricter sales guidelines.

The stricter guidelines includes requiring the home to be considered habitable which means the home must have a working furnace, good electric, good roof and a few other requirements. This is regardless of the condition the home was purchased or price the home is sold (even if you give a home away for free, the home must be habitable by their definition).

http://www.tdhca.state.tx.us/mh/

What do you mean by investor model? I haven't heard the term related to Lonnie deals.

Carl G. Texas has one of the strictest requirements for licensing. You're allowed to sell one home every twelve months without a license. If you're married, you can do the paperwork in your wife's name as well. After that, you'll need to take the state class, pay for bond and comply with state regulations. So if you're interested in mobile homes, you can test it out on a deal or two to see if for its for you before going through the licensing process.

If you haven't done so already, you'll want to read Deals on Wheels by Lonnie Scruggs.