Yesterday, I closed on my first flip in over 5 years. I had to stop for a while and use my money for my son's college degree, but what a good investment that was. Anyway, I never wanted to invest in a mobile home, due to the depreciation factor. But a single divorcee friend had one she wanted to sell, just to get out from under the loan and get rid of the terrible renters that trashed the place. It was cheap $55K. 2100 sf on a beautiful, peaceful 3 acres a few minutes from town. Unexpected expenses were a new heat and a/c unit at 5K and a new water heater. I paid for these by forgoing the new kitchen counter tops I had wanted. I fixed it up super nice: all new flooring, 2 inch blinds, sinks, lights, fans, paint, mirrors, toilets, ss appliances, new roof on the back porch. It looked great and we listed. Lesson # 1: FHA mobile must be anchored, which meant $2300 for foundation work out of my pocket. Lesson #2: My first buyer was 48 hours from closing when a 2nd appraiser sent by FHA determined that the mobile had been moved twice, which makes it ineligible for FHA. This was huge, I was mad at my realtor for not knowing and myself for not doing my homework. Now I am in shock because who is going to be able to finance a 20% down conventional? If they have that much, they will buy a stick house. Lesson #3. Conventional lenders for the most part have a self-imposed 15 year age limit on mobiles. My home was built in 2002. That leaves cash and VA or me helping with the down payment and there goes my profit. I am secretly getting a little panicky, but I sit tight. A few weeks go by and a buyer from out-of-state pops up with a full cash offer, sight unseen. Call me skeptical. But as it turns out, it was legit. The real estate gods were looking out for me. Our area is near Waco, the land of Chip and Joanna. Thank you for making us a real estate hot spot. Now if I just had Chip and Shorty to work on my fixers. Heck, my daughter worked for a foundation company that the Gaines owed $40K to way back when they first started out. To their credit, they made it right and as they say, the rest is history.But I digress. Long story short, I got funded yesterday. It appraised at $135K, and I sold for $132K. I would have taken $122K. After holding back for short term cap gains, my profit was a sweet $20K. Lesson #4: I'm getting my re license reinstated from 10 years ago. Why pay an incompetent agent when I can pocket the commission? I had to tell her what to do every step of the way. My opinion is if you want to invest in something that depreciates, and has wheels, buy cars. Thanks for listening. I love BP!
