All Forum Posts by: Jon Dorsey

I’ll PM you

Valuation is based on NOI of lot rents then add to that whatever value you want pay for individual mobile homes.

Metering: you can call the current provider to see if they would do it, thus keeping you out of the loop. Otherwise it’ll be $200-300+ per home to get meters installed. There are systems that will automatically send you updates but have a monthly fee, which could be passed along to tenants. 

Septics: just put it in the lease of what’s allowed down the drains and they’re responsible for any clean outs. You’re still responsible for physical tank. 

They are easy to move but it’ll cost you $3-5k to have a licensed mover do it.  

@Ashish Acharya

What’s the depreciation schedule for this personal property (MH)? Is there bonus depreciation that can be recaptured in the first year?

Appraisal only if required by bank. Otherwise a wasted expense. Timing depends on closing date and wrapping up what’s needed to finalize lender financing. 

I’ve heard of some getting this loan. Just depends on zoning and you have to find the right loan officer. 

Two options: 

1) Get them to take a lower price $550k

2) Make it contingent on appraisal and when the bank won’t finance the deal hopefully that will drive down their expectations. 

$300 spread on POHs is enough to convert them to TOHs. You may lose some in the process but it’ll be better for you in the end, unless you are willing to do the maintenance to keep them as rentals. 

Push rents up in 2 steps to market. You have 12-18 months to put in some capital to get it on par with the other community that you said was in better shape, thus justifying the lot rent. Then keep increasing it annually at CPI+1-2%  

I’ve looked at one, similarly 20 occupied lots with POHs, and they want $1M. The broker sold the seller on this price and I feel whoever justifies buying that gets everything that’s coming to them. Lot rent is $200-250 for the area and has private water/sewer.

https://www.mobilehomeuniversi...

@Tim Y. Definitely keep digging into it. Work on the relationship with the owners and find out what you can about history, financials, tenants, etc. Build the bond. Then work down the price. Bank underwriting will help you with getting the price down because they won’t seller finance. You could agree on a lot rice with a stipulation on about bank financing to reduce it further. Plenty of options. 

I have a smaller multi family property and have a PM company that I really like. Our agreement on fees states they get a % “of total gross rental income received on all rental agreements.”

They see that is taking a % of collections at 100%, what could be, whereas I see it as % of what was actually collected that month. Every month there are a few tenants who are late but catch up within the next 2 months. 

My concern is that the PM is taking payment on rents they haven’t collected. 

Two questions:

1) who is correct on gross rent definition?

2) am I making a mistake by addressing this bc the PM goes above and beyond and I eventually get that back rent?