Hello Bigger Pockets! I had a mobile home park come up for sale recently in my area, and would really appreciate some advice as I evaluate. I'm a fairly new real estate investor, with no experience in MHP's. I've been intrigued with this type of investment since first hearing about it on the BP Podcast. So, my question - is this a good deal?
The numbers:
Two sites - an 80 site lot and a 29 site lot, both in the same town.
Lot rates - $265/month
First lot is City water and sewer, billed back to tenants.
Second lot is City water and sewer, individually metered.
Electric and trash are also billed back to tenants.
Occupancy - 45%
Built in 1983
City Population - Approx. 35,000
Park is all tenant owned homes, with the exception of 5 units. Owner also has 12 homes that need remodeled, and then could be sold/RTO to tenants. Seller is claiming an 11% cap rate. It seems like this could be a $2k a month cash flow investment. This area has had very little growth in the last 15-20 years, but there are some large manufacturing companies and oil businesses in the area and unemployment is very low. Any advice would be greatly appreciated! Thanks!
