All Forum Posts by: Joshua Diaz

The .10 signifies a 10 cap on a park purchase.  And I get the 10 cap from Frank Rolfe and Dave Reynolds, who like to buy parks at that cap and value them as such on the purchase.

And we are talking about profits after all expenses you can think of EXCEPT debt service.

Hope that helps!

@Ralston Grose

Just for another perspective:  that wouldnt excite me at all.

If anything,  I would go bigger and find a money partner while doing all the operational stuff myself.  Splitting it 50/50 as well.  That way the down payment wouldnt be so much of a stressor (but I would still put in some money to have skin in the game) and we would both make out better than 700 a month

Just my two cents.  But definitely keep on analyzing!  Best thing for ya

That’s cool and you’re welcome.  Just keep in mind all the money in expenses for each of those park owned homes.

I’m not experienced enough to be more specific than I already have but I wish you the best of luck on your path.

Are those rent amounts and expenses a monthly amount or a yearly one?

Take the profit you get after all the expenses for a year and divide it by .10 for an idea on what the price would be.

700,000 seems way too high at first glance

So from all I’ve heard and read, the rentals from park owned homes are not counted in the same numbers as lot rent.

The model people tend to go for is to have only lot rent and have all mobile homes owned by the tenants.  Refinancing would be difficult if you try to include rentals from park owned homes.  Most lenders seem to shy away from that.

That said, 700,000 for 47 spaces seems kind of high to me based on what I’ve seen.   When you add up all the lot rent, what is it per year?

Do you know what the cap rate of the park is?  Or what cap rate you are looking for on  purchase?

How old are the park owned homes? Adding the value of the homes to the price may be the simplest way to do it but I’ll let someone with more experience chime in on that one.

Hope this helps .

Well being new myself, I don’t have experienced advice but some avenues I was thinking about would be:

1)manufactured housing associations

2) real estate investors groups

3) through any RE agent you have dealt with if they have heard of anything or know anyone.  Helps if their brokerage deals with the MHP space

4) and of course Biggerpockets , itself.

Other than that,  tell friends and family what you want to do and why you are enthusiastic about it.

And I’ll do the same.  Best of luck!

That was an amazing read! Thank you so much for sharing and congratulations on your success!

Hey there.  I have yet to buy. Mobile home park but the way I would do it is by going off what income it makes.

Take the lot rent each pad currently makes in a year and minus out all the current expenses besides any mortgages.  That would be the net operating income for the year.

Take that number and divide it by the cap rate (usually the average cap rate of the areA I believe) and that would be your price.

Do not count the mobile home rental income.  Lenders don’t calculate that and neither should you.

Kelly blue book should give you an idea of what the homes are worth so you can add those to the price of the seller is insisting a worth to those.

Again, Do Not include mobile home rental amounts in your calculations.

Hope this helps a little.

Yup.  From what I know , commercial loans in the mobile home park space can be really creative.

So you mentioned that institutions see this as too small and hard money is too expensive and restrictive.

One way I’ve read of is to try for a seller finance.  Is that something the seller is willing to do?  It’s the cash flow that they received before but for none of the work now.  The terms are all completely negotiable in this case.

A bank with the ability to do portfolio loans can also be an option here.  These are usually smaller local banks that probably won’t have a requirement of a mil and up for a loan.  Worth it to call around all the banks .

Or if you have family and friends you can raise money from in the form of private money, that is another option.  Everyone’s family and friend situation is different though and I’d say be prepared to show proof of why this is a good opportunity for them to mke a return in their money.  That’s inportant, you are doing them he favor and not just asking for money.

Again I’m not an experienced financier but these are the most common ways I hear of to finance mobile home parks.   I hope this helps even a little.

Best of luck .

Brian Spears’ account still looks open to me.  He did respond to someone whose account was closed and their original post removed so it does sort of look like he is talking to himself.