All Forum Posts by: Miriam Seidel

If it were me, the cabinets are shaker, (which is still in style), I would sand and paint cabinets white or light gray. And add modern hardware. 

If rent to own or seller financing in your area with stick built homes have the same deposits and monthly payments, no reason one would want to purchase a manufactured home that loses value over time. With mobile/manufactured homes, it's all about the
deposit/down payment and monthly payments. You need to make these more attractive than for a stick built home, in order to get offers. (Thousands less for deposit/down payment and hundreds less per month for the home). Are appliances included? If not, put them in. Would a backyard fence be good for family with small kids and pets? Talk to a mortgage broker about what parameters your stick built competition requires, and make it more attractive than those requirements. Also, if renting an apartment with the same amount of beds/baths would be more than what you could offer, that is your market. Send postcards to apartment complex renters that offer a home with more privacy, less restrictions, and something they can own vs rent. Also, Open houses are a must!

What is the condition of the water/sewer/septic, etc. Very important to figure in the cost of this maintenance/replacement. Most parks that were started in the 70's will need the pipes replaced really soon, if not yesterday - assuming they have never been.
Also condition of roads...when will they need repaving, and how long will that last?
As well as fencing and any other common areas. And ad 10%-20% vacancy rate loss, when
someone doesn't pay rent, and you have to kick them out, etc. Usually these are left
in horrible condition, and need rehabbing before reselling. Also, you may need to replace instead of rehabbing, if it's a tear down - & looking at $50K-$75K for a new single wide.
10% CAP rate is the norm for any investment real estate. So, with your figures above,
$642K with 10% CAP rate - before deducting for all of the things mentioned above.

I had 3 vacation rentals in RV Resort in FL. I sold 2 and am selling the 3rd one in a few months. I was doing well before VRBO merged with Home Away. Now they charge a lot of service fees to both the guests and the owners, which make it extremely difficult to stay competitive with rates. I have not been able to raise my prices, and the lot rent keeps increasing. Also, in the off-season, very difficult to get good guests. The last guests I had stayed for 2 months - Aug & Sep, and totally trashed my place with over $800 worth of damage.

Vacation Rentals take a lot of work & time on the owner's part. Keeping clean, washing sheets/towels, etc. And, the maintenance is a constant battle. Also, must charge state and tourist taxes and cleaning/pet fees to the guest, and pass on - which is a lot of accounting. (Also, increases the cost to the renters, which again make it difficult to stay competitive to keep your place full) It is treated like a hotel.

If you can find a good renter for 6 months, it might be ok. BUT, very difficult to find that good renter in these price points.

Also, if renter has kids: mobile homes/park models - they don't stand up like a stick built home would.

Felons tend to gravitate to campgrounds, because if staying under 6 months, no background checks, and relatively cheap compared to apartments.

If it's on it's own land, consider putting on a permanent foundation (usually cinder block works),

and then you should be able to change the "mobile home" into "real estate" and hence get regular

financing. Also, will UP the value of the home considerably.

If you can not tear down old mobile homes and replace with a new one (which is what i thought i

heard from you), you can add vinyl siding and roof-overs to old ones, that will create a great new look.

You could also look into "rv resort/camp ground" zoning, and replace with new park models and have a "tiny house community", that you could also rent as vacation rentals - if in a decent area for this type of rental.

NOTE- if you have seniors, you may have a really hard time getting them to leave. There are laws protecting them from eviction.

Suggestion - do an addendum with the renters that require a periodic inspection of under sinks, baths, toilets, etc - and make sure you put pans under sinks in case of leaks. Your entire sub-floor can be ruined if there is a leak and the mobile home sub-floor is particle board vs hard wood. This is the #1 issue with mobile home problems.

All depends on if in a community w/lot rent OR on it's own land.

If on own land, go for it. If it is in a community w/lot rent - steer clear.

When in a park/community w/lot rent - is not considered real estate, because there

is no land that is purchased. The land/lot is rented by the owner of the home.

Gets very complicated, because most park owners/managers will try to get involved

and prevent you from completing anything. Because it is considered chattel, they

have the right to foreclose and take the property if the owner is behind on their

lot rent. Also, the buyer needs to be approved by the park before they can purchase.

And, many will not approve a flipper/invester/rehabber - which will waste alot of

your time. 

Mobile/Manufactured Homes are valued differently than stick built homes. It is like a used car, once a new one is purchased, the value of the home goes down immediately. If buying a property that sits on it's

own land and the home has been put onto a foundation, then the home & land's value can be calculated like it is a stick built home. If it sits on it's own land, but not on a permanent foundation, then find the value of the land through the normal real estate comps procedures, and find the value of the home's "blue book value" and add together. (MHVillage has a book value report for mobile/manufactured homes for $14.95 each. It will give you a base value, and then the opportunity to add to that value with options - new roof, new appliances, etc).

The third option is where the home is in a park/community. Besides the mhvillage value, the community it is located in, plays a part in what you can ask for the home. I have found, apples to apples, when in a park that has lower lot rent, can ask more for the same home. For example, in my area, there is a community were the lot rent is over $1000/month, and there are so many homes for sale (because the retirees don't want to pay that much), the median home will sell for $25K. Taking that same home and plop it in a community where the lot rent is $600/month, the median home will sell for $60K.

It's all in buying for the right price. Also, many communities will not allow rentals & must be owner occupied.

If you do not own the community, it can be a very difficult venture. Also, all communities require, background check and income/credit verification to be approved for buyer's to live in the park and purchase a home. (Which also means you have to go through this process to purchase a home as well). Also note, if the home needs new roof and/or sub-floor, you may end up putting too much into the home to make a profit on the sell-end. Also, if selling a home in a community, where you do not own the land, you have to get a used mobile home broker's license, or be an agent with a broker that has this license (similar to a used car dealership license).

Here are my positives, to your negatives:

(1) The 55+ age restriction..... I would think that narrows the tenant pool quite a bit.....

--- Better quality tenants

(2) Since its a gated mobile home community, the park has to approve buyers and tenants..... I don't like ANYBODY telling me who I can rent to..... I have strict guidelines for my applicants, so I doubt I would have issues getting anyone I approve past them, but I don't like the idea of someone else having a say on anything about the unit

--- The community does the background check, which the prospective tenants can pay for...

--- Felons are not allowed to reside in this type of community

(3) Exit strategy....... seems more narrow that a typical SFR etc

--- Selling will be to 55+ persons, where they also have to go thru background check AND

--- Income verification thru the community

(4) Harder to research value, rent rates....market/advertise......tenant screening since many might be retired etc

--- Website called MHVillage has an easy valuation finder for small fee