All Forum Posts by: Andrew Warner

@Janine Smith @Bill Jacobsen Thank you for your responses! I plan on calling a few owners and asking them. I have seen very little on hotels/motel investments on BP. It is one of the reasons I plan on moving into this niche.

@Jordan G. 

 Hi Jordan,

I am currently working as a MHP broker in AZ. I am working with my father who has been in this business for over 10 years and is doing quite well (I would say he controls most of the market in AZ). 

Since you are starting out in MHPs as a broker I will give you advice based on what he told me and how he got started. 

First off, we never really use loopnet or Costar. And when we do use costar it is usually for comps or to add recent sales into our own database. We never list properties on the MLS and all of our listings are pocket listings.

I recommend focusing on Parks that are at least 80 spaces or 1 million or more. In fact the bigger deals are the easiest deals to do. In the larger deals you deal with people like Jim Johnson who have bought parks before and don't need you to hold their hand through the entire process plus the pay out is more. Second I recommend you build your own private database. The advantage of being a MHP broker is that technology has not caught up with this niche yet. In fact costar and loopnet have almost no information or very faulty information on MHPs. This makes having your own database even more valuable. If you have the information, know who is buying and selling and where the deals are you will own the market in your area. 

Goodluck

@Paul Choate Who pays the Utilities? If they are included in the rent you should get the mobiles metered and get some added cash flow quick. Should be around $150 per mobile to meter the park. Pretty quick, easy and cost effective way to increase your income.

Hello BP!

I was wondering what information experienced investors look for when buying Hotel/motel investments. What information is most important for analyzing these deals? If any investors in this niche could enlighten me I would appreciate it. I am a real estate agent in Arizona and am planning on creating a Hotel/motel database of all the major properties in this state. Knowing what information is most important to investors when looking at this property type will help! 

Thank you!

The brokers in my office always joke about these. Usually when people start converting apartments into condos it is a sign that the housing/multifamily market is about to crash. Way risky and a lot of people lose money doing this while a small few make out with the right timing. 

@Jeff S. Thanks for the tip! I always thought the 1-4 units applied mainly to FHA loans. I'll keep that in mind.

-Andrew

Thank you @Deborah Smith for the advice! By multifamily do you mean a du/tri/fourplex?  I have been looking at some in Tempe and they seem a bit pricey right now and don't meet the 2% rule. I recently talked to @Justin Howe and he said the PMI is now required for FHA loans and that a conventional loan may be better suited. If this is the case I wouldn't mind looking into a more than four units.

@Deborah Smith @Mike Dmuchoski 

Thank you for your responses! I am still living with my parents right now since I am doing commercial real estate. It usually takes about a year before you start seeing any income with my current job. We have 2-3 big deals that are going to close soon and I am expecting to get a large amount of cash to put down on a house. Since it is going to be my first investment my plan is to live at the property and get a fixed rate 30 year FHA loan. However since my income is not very consistent I will need to to rent out available rooms/units. The plan is to pay off the mortgage with the rent and continue to use my income to invest. I want a property that isn't cheap but also not too expensive (100k-250k).

Hello BP,

https://asunews.asu.edu/20140804-business-orr-hous...

Just read this report today. It appears the Phoenix, Arizona market is hitting a slump. I am planning on purchasing a house soon and want to time it right with the market. I'm thinking about waiting a few months for the prices to go down to meet demand. This will be my first real estate investment and I would like some other opinions on this strategy. 

Thank you!

@Account Closed said MHPs with mostly Park owned units are usually a lot of work and high turnover. With Park owned units you have the added cost of up keeping the mobiles. Also since the mobiles are park owned it is easy for tenants to just pick up and leave. The tenants in MHs, especially park owned home renters are lower tier, and are likely to cause damages to the mobiles, especially since they do not own them.  Most savvy MHP investors try to avoid Park owned homes for this reason.