All Forum Posts by: Ryan Groene

your going to run at a very minimum 40% expense ratio. because it is a smaller park with lower lot rent, your not going to get the economies of scale that larger parks enjoy.  everything is the same price per home expense wise and your going to more than likely self manage this or have only a part time person in order to make a return.  

RV parks are along the same lines of a Mobile home park, but the tenants that come to truly RV parks, depending on where you are in the country are normally a little different tenants than RV tenants that park in a MHP.  Normally they have a little more disposable income and look for more things to do in the RV park beside just a cheap place to park...it also depends on what part of the country your in as well.

developments of rv parks can work, and are cheaper because you don't need to bring in a home. just a little more management intensive because a lot of customers pay in cash and there short term.  they do work well though and can make just as much money/returns as MHP's

@Melissa N. Here is how to evaluate the deal...  $175*17*12=35,700 yearly income from lot rent and number of occupied lots

37500*.5(operating expense ratio of 50%)=$17850 Net operating income(NOI).....your operational expense will/could be higher because it is a smaller park w/ such low lot rent and private utilities.

then divide that by the cap rate you want to pay, lets say 10%----17850/.1=$178,500 purchase price on lot rent only

then add in the single family home, discount it at least 30% from other comps in the immediate area becuase it is in a mobile home park after all.  or if you can parcel it off and sell it, do so to recoup more of your cash in your investment.  

then add the total amount of the park owned homes inventory and youll get your total purchase price.  I woudl say just based on initial operations, i wouldn't pay more than $250k because it is a smaller park, with private utilities..

getting titles to a Mobile home is one of the most painful processes in the business. it can easy or extremely difficult depending on state.  Its basically like a car title.    Check state laws on how to get the title. some you have to fill out an abandonment form, then let it set for a number of days, just depends.

For me, i would want a higher return than a 10% cap rate because its smaller and private utilities, due diligence is your best friend when it comes to these types of utilities, check state laws on septics/wells as well.  they can/could be a problem for sure, just depends on your level of comfort/education on them.

@Grant Rothenburger is correct in kevin bupp and frank rolfe are both great leaders within the industry of Mobile home parks and have great content..most free with some that you have to pay for...but well worth it

do both if you have the money. I have done them. Did them a couple years apart. Knowing both frank and Kevin bupp. They are both industry leaders in education  and you won’t be disappointed with whom you choose 

drive around local mobile home parks and look for homes that have for sale signs in the yard or windows. then talk with owners or park manager about buying it.  you will have to still meet the park criteria for owning the home, just let them know you want to rent it out and they should work with you maybe.

or check craiglist as well for homes for sale.

call around to other MHP's that have RV spaces in there and see what the market is doing.  If they are doing something similar, then do that.  See if they are charging back for utilities.  IF they are then do it as well as long as your market rates for space rent is around the same or below market.  If you are below market in your space rent, you could just charge a higher rate to offset the amount of the utilities.

@Matthew Wright i believe @Mindy Jensen and @Brandon Turner MHP is in Bangor, Maine.

Mobile homes if taken care of, can last 50+ years with no issues. depending on the market, 1 bedroom mobile homes are a lot harder to fill, even with senior citizens and single people.  2 bedrooms are always better and 3 bedrooms are the industry's most sought after units.  As long as the older units are taken care of and show pride of ownership, the park can still be a profitable park and can be held for years to come as the shortage of available affordable housing continues.  The smaller lots could be a problem, just evaluate it as such and the potential for reducing number of lots if you need to bring in a newer/used home.  be sure to check the setbacks, etc. that the city dictates.

Typical moving cost are around 4-6k to get it moved, set up, tied down, etc.  contact a couple local movers and get quotes.  easiest thing to do.

CASH program is the program that clayton homes runs for new and used units and financing them.  There are some caveats with it, but theyll let you now what those are.    

you could also try the CASH program thru Clayton....there are some specific's that you and your park have to meet...but its worth a shot.  Mobile home financing is starting to get a little bit better...but like @Rachel H. said, most owners have to bring in new homes themselves