All Forum Posts by: Harold Anderson

My wife and I argue about that one.  So far, we've only done the older MHs with wood panelling.  I prefer to fill in the grooves and make the place look as much like a stick built as possible.  She says, just paint it.  

We renovated a 76 double wide on land.   I filled the grooves and made the walls look like standard walls.  Where I had to take panelling down, I replaced with 1/2" drywall.  The going rents in the area for a doublewide on land were $6-700.  We hired a management company and they easily got $1150 for ours.  And, so far, the 2 families who've rented it have been very respectful of the house, keeping it up better than most renters.  

Is it because of the renovations or a good management company?  I don't know because I haven't rented one that hasn't been renovated.

@Brandon Brown

Make sure that you check with your county and the one you are moving to.  Some counties won't allow moving a MH older than a certain age.

@John Fedro

While I understand what you're saying about "messing up", I've made and am making some of those "mistakes" right now.  It's certainly good that you point them out but sometimes us "newbies" just haven't come across the advice yet or get ourselves into a situation where we don't know what to do so we make the "mistake" because we have to act.  

In my case, I bought a MH for $1000 in a 55+ park that doesn't allow rentals.  I started with a plan to do modest renovation only to discover that it had hidden leaks in a number of places.  Suddenly my costs soared.  But I had to fix the leaks.  The project time expanded from a month to months.  Hiring someone would have brought the time down but increase the costs far more than the extra monthly lot rents.  Since the costs have gone up so much just to get the leaks repaired, I figured I'd need to get a better buyer who would be more demanding.  So I ended up renovating the entire MH including new kitchen cabinets.  It's been 6 months, I'm within days of completing, the place looks gorgeous, a neighbor wants to buy it, and I've offered to finance it.

I'm not saying this to look for advice but to show what experience does when you've read the books, gone to the meetings, talked with the local gurus, etc.  

I don't consider my decisions mistakes even though I'll likely lose money on this ( I haven't set my price yet).   I love what I've done and could have spent a lot more than my losses in education expenses and still made the "mistakes" I did.

The problem that Erik and I have is that we have to find our own way.  It would be great to have a guru as a partner to tell us what to do all along but that won't help us to find what's best for us.  

Harold

@Spencer Keables

I agree that a stick built holds it's value longer and might be a better way to go.  However, you could get in at a lower price on mobile home.  If you go that way, I'd find one on land.  Make sure that you can rent it out later if it's in a park.  Get the seller to carry financing.  Then you can get your hands wet on doing repairs and/or renovation.  If your situation changes, you can rent it out and buy another or move to a stick built.

@Richard Zuptich

I know what you mean about not understanding language even from RE 101.  I strongly recommend that you do not jump in without understanding what you're doing.  Some of my biggest losses have come from doing that.  "Become a millionaire - here's how".  I suggest that you start with something you can understand.  

While I love real estate, I am not a big fan of going into real estate to make money.  I'm a fan of leveraging what you can and what you can understand.  If you're working and get a 401K, take advantage of it.  It's a great way to increase your nest egg.  If you own a home, can you make money off of it?  Rent a room?  Start a B&B, vacation rental, etc?  If you're looking to buy your own home, buy something that can bring in extra income.  Rent parking?  Buy a small farm and sell off a chunk of it?  Or put up a nice house and sell it for a larger sum?

There are other ways to make money easier than RE (ignoring the experienced investors who apparently can buy a place and turn around and sell it for double the money putting almost no time or money into it - does this really happen?)  I love evaluating companies and investing in the stock market and have done much better with that than I have with my RE moves.  Some have done excellent with options, bonds, etc.  We've also done very well with starting B&Bs (the hospitality industry AND the real estate part of it).  Then there's buying or starting a small business(very risky unless you know the business very well).

I wish you the best.  

I suspect that the rules vary state by state.  We owned a water utility in Arizona with a mixture of 525 MH, stick built, and very high end homes.  We were regulated by the state but could and did turn water off if the bill wasn't paid.  It was simple.  We'd give them a month to pay.  If they didn't, their water was turned off until they paid their bill.  They had other options for water.  We just didn't have to send it through their pipes if they didn't pay.

We had a small group of people we had to turn the water off on fairly regularly and a few found out how to turn it back on.  We'd just go back out and turn it off again.  In rare cases, we'd put a lock on the valve.  

We looked at it as how we had to do business.  

We also sent them a newsletter once in a while with tips on how to save on their water bill.

@ Jon Carter,

I see no problem with your wife's challenge on your first deal.  I'm an investor.  I want to see a return on my investments.  I see no problem with challenging yourself to make 25% in 6 mos with $10,000.  However, to say that you can't make it as an investor if you don't meet the challenge shows that she isn't an investor.  

My investing started in and continues in the stock market.  Today, after 15 years, my odds of making that kind of return and more are much better than in my first year.  That's after learning a lot about the market.  While I agree with the people here who talk about high risk in the ventures that would make you that much money, I think it's more about temperament.  In the stock market, a widely made claim is that, if you can't stomach the ups and downs of the market (such as a 50% loss), you don't have the temperament to be a good investor.  

It doesn't bother me, in the stock market, to take a great loss because my experience shows that if I continue trying I will do better (far better) than putting my money into safer investments.

Real estate is generally lower risk than the stock market therefore your returns in RE tend to be lower.  

People have suggested that you invest the $10,000 in education.  I've spent that amount in education but I haven't started really learning until I've got my feet wet.  I guess I prefer the higher risk of investing to see how it goes.  That's what your wife's challenge is without acknowledging the higher risk of the attempt.  But you need to be able to learn from that and, even if it doesn't succeed, try it again until it does.  If you or your wife can't stomach not achieving that 50% annual return on your first try, perhaps real estate is the wrong investment for you.  

I am also a big believer in leveraging what you have to do anyway into a real estate (or other) investment.  Ideas are to buy a home with income potential.  There are so many ways to do this I can't list them all.  Some we've done have been to buy a very large home and rent rooms either monthly or shorter term as in for Bed and Breakfast income.  We've bought a farm and put cabins on it creating a farm bed and breakfast.    Our current home pays us back  more than $3000 over our mortgage payment.

Bottom line is that you can succeed as a RE investor but not if you set yourself a tough challenge with the penalty being you can't try again if you don't achieve those lofty goals.

@Orlando Paz

I don't remember how you intend to get into MH investing.  If you're buying on land, you'll need more money than buying in a park.

Are you planning on rehabbing?  Or just buy it and flip it?  

If you're planning on flipping, you'd be in a better position to sell quickly if you can offer financing to your buyer.  If you buy right, you can get a down payment, when you sell, to cover your costs.  Then enjoy the monthly payments.  But you need to think about the unknown costs of repairs/ renovations.  These can be substantially more than you think.

I think your best bet is to find a seller willing to carry a note for you but that will take away much leverage for you to buy at a discount.  But there are sellers out there desperate to sell so it wouldn't hurt to try both.  

@Leslie A.,

What kind of rents can you get in Houston for a FEMA trailer?

I'd love to one day start a park.  But it doesn't seem to pencil out for me.  Land is pretty high here.

The park I'm currently working with is for sale for $5M (MH and RV).  I haven't looked into it as I'm not interested in jumping in that far at this point.

The land I'm currently renting is our own parking area and it's only for about a month.  We're not planning on doing this as another business.  It's for a friend who pays us $100/wk.  

I was looking at a local Streamline Trailer - a '71 with an asking price of $4500.  But if I rent them out, it would make more sense to find more run of the mill trailers for lower price.

Thanks for your tips.

Harold

@Leslie A.,

I remember that you did that.   

I'll contact some RV parks.  We have a lot of temp workers around here.  In fact, we considered renting rooms to the employees of a crane company recently but found another, better solution for them.  

Do you get newer RVs or rehab older ones?

Are you able to get discounts from the parks?

We're currently renting part of our parking area to a construction worker in his tow behind (is that still considered an RV?).

Thanks for your response.

Harold