All Forum Posts by: Howard Abell

I would think that you are a candidate for looking at single tenant net leased (STNL) properties which at a 7% Cap could give you an investment grade tenant (S&P BBB) or better with the possibly a 2 to 3 % escalation of rents. This is great for out of state investors which those in California know very well. These include fast food, dollar stores, medical offices and others.

I think you are on the right track. You need to use what you have already accomplished and leverage that with either the banks or private money. You have a history of success even though it is in SFH but you can show a nice track record. I would approach individual investors. you may have to give up more equity than you want but after a few successful deals you will be able to set better terms.

If it is "lot rent" meaning a payment for the land where the home is placed than the amount depends on many variables. The fastest way to determine this is to compare other places in the area.

For more detail on this and other questions about mobile home investing I would suggest the mobile home forum here on BP. It has very experienced and giving members. 

Hi Donna,

Welcome to BG. I would encourage you to look at the Mobile Home Forum and the Landlord Forum here on BG. There is a wealth of information from very nice people who are doing real estate deals of various kinds and who appreciate others who share. 

If you or your investor boss will look a little further into North Carolina, I may be able to help find some great homes or a park or two.

I might be missing something here but why not reduce the selling price by the estimated cost of the violations and do them yourself after closing and  proceed to closing where the liens are paid off from sellers side of transaction?

I have two mobile homes, recently rehabbed in my park in Lillingtion, NC. They have renters paying 600 and 630 per month. ROI between 15 and 20 percent. We offer PM services to make it totally passive investment if you wish. We are an investor friendly park and welcome investors into our community. The only requirement is that the home remain in the park. Call me at 919-444-4358 or email at [email protected]

your are welcome.  Reach out anytime.  Good luck.

I am not sure we are talking about the same thing when I say debt coverage ratio. It is not debt/income ratio that I am referring to. Debt coverage is the about of NOI available to pay for the debt owed to the lender. For example if your net operating income is 5,000 and your debt payments will be 4000, that is a debt coverage ration of 1.25 (5000/4000=1.25). Most banks would use this as a minimum for debt coverage. A private lender may or may not be happy with that ratio.

You also might consider trying to simplify the interconnecting issues as much as possible for the lender to feel more comfortable when underwriting this loan.  

I think you need to show the debt coverage ratio (DCR) to show you can pay the 2% at least. Also you need to lay out how you are going to pay of the debt in 12 months. In other words, what is the exit strategy?

I would first jump on Amazon.com and look up commercial real estate books. There are not too many but it is a starting place. I would then seek out someone in the industry and take him/her to lunch. Be up front with them and you might get some valuable insights into what commercial real estate is about. A logical person might be a commercial real estate broker but it depends on how they feel about wholesalers.

Good Luck!