All Forum Posts by: Troy Bevans

@Steve Coffey I too am in the Quad Cities and have been in the tech field. I have been investing in single family homes around the Bettendorf area. Welcome aboard!

Very interesting topic! I need to look this product up. I too try to set myself apart when it comes to the rental home market. So, I have spent a little extra $'s on the Nest products with an Internet On The Go hot spot device in each home.

The thermostat looks great...but does not bring in additional revenue : ( It does allow me to advertise the "smart" device though : ) And it also allows me to control the thermostat remotely if the the property became vacant.

Their other product, the Nest Protect (co/smoke detectors), allows me to see if the batteries are still working in the units remotely and can get a notice if an alarm goes off. I guess it has a bit of risk management associated with it.

Now you are making me want to paint the ceilings and make them smell super pretty too!!!

I am seeing a lot of Mobile Home topics lately and some wonderfully knowledgeable individuals have posted some great topics. With that in mind, I would like to build a list of items that the majority of MH investors could utilize as we review a potential purchase.

I would then like to take this list and create a standard checklist that helps "qualify" the property with a grade...like the type of grades received in school (A, B, C, D, and F). If the property receives a decent grade, the next process would be to "quantify" the property, which will allow the investor to get an idea on the hard dollar signs associated with bringing the property up to a better grade for sale or lease. The quantifying process will be different for each person and location of course. I am more focused on the qualifying side for the checklist to help us get to the quantifying side to make a decision.

QUALIFY TO QUANTIFY = BEST DECISION

Therefore, for all of those wonderfully knowledgeable individuals in the MH sector of our passionate drive to success....what would you suggest would go on this checklist? What typical items should be addressed...floors, roofs, plumbing....what are the best questions to ask the seller...and so forth?

A system that can be repeated over and over will produce a better opportunity for consistent results. So I am hoping to gain some great info from this to put into a standard checklist that can provide a systematic approach to reviewing any future mobile home investments. This checklist will be shared for anyone who would like to see the final results.

For all that participate, thank you for taking the time to do so. None of us are as strong alone as we are together! I love BP and the members for sharing their experiences and knowledge!

@Wilson Lindsey - Create a checklist that "qualifies" the mobile home you are considering. The checklist should cover all items within the MH, as well as the specific questions you should ask the seller. Add the numbers up and grade the property on some type of system, such as an A - D grade...like school...and some may even receive an F!

Once you have a few A and B (even C if you feel lucky) mobile homes in mind, you then start the "quantifying" process to discover how much it is going to cost to get it ready to lease or sell (which means getting the property a better grade). You will find that a lot of these MH's did not get their homework done...so you will need to catch up that work...which can cost $$$'s. The quantifying part will finalize your decision as to whether it would be a good investment or not when you see the actual "hard" numbers.

Qualify to Quantify = Best Decision

Research all of the items that need to be looked at when reviewing an MH for purchase to help create this checklist and use it for each opportunity. A system that can be repeated over and over will produce a better opportunity for consistent results.

Best of luck to you in your process : )

@Stephen Dominick - I really love the fact that you put a focus on families that need a break and the retired baby boomer. You didn't start out with asking how to make the most money possible with mobile homes (the get rich quick dream), which says something about you and the business model that will be created by you.

If you can obtain the MH without debt service, you will be in a much better position for profitability. I totally agree with you that a mobile home is nicer than your average apartment and feels more like a "home".

If there are concerns about about the property being destroyed, include "safety" inspections throughout the duration of a lease agreement to stay on top of how the home is being treated. Keep in mind, if you do this for one property you own, you will need to do it for all that you own, so that you are not creating a discrimination factor.

Welcome aboard! Wisconsin is such a wonderful state...with an awesome product called Spotted Cow...ever heard of it : )

You won't need luck to be successful in real estate investing when you are member of this incredible site, so keep on reading, asking, contributing, and growing!

Welcome aboard! Real Estate is addictive no doubt and you are in the right place to fill that need! You sound like you have a good plan moving forward.

Very well stated @John Fedro !!!

I am on my first MH right now and think my strategy is to purchase the MH, make repairs as needed, rent the MH for the first year to recoup some dollars, then ponder the idea of selling it in year two. If my first year tenants worked out well and decided to renew for a second term, I would hold off on the sale. I have my tenants selected and they move in November 1st, so we will see how all of this goes : )

I am still perplexed on the SAFE Act, so I am wanting to make sure I am staying within compliance before attempting the sale of the MH, as seller financing was a huge key in this side of the business.

@Eric F. , I would determine that based on the total amount you spent prior to getting the mobile home rented. The less the MH cost you to purchase and fix up, the better that $300 will feel each month (your capitalization rate, which is the ratio between the net operating income produced by an asset and its capital cost, and actually does not count the purchase price of the asset). In the example below, I counted the cost of the purchase price of the MH asset.

For example, if you purchased the MH for $2000 cash and put in another $3000 cash in repairs, and all of this is completed before your first lot rent bill, your total outlay is $5000, without any financing. If you can clear an actual $300, after all expenses, for a solid 11 months (factoring in vacancy), that makes your cap rate 66% during that time [(300 x 11) / 5000 = .66]. That is DARN good!

Insurance for my 1982 MH is $25 per month and I have also added another $25 - $30 per month as a maintenance factor....the "just in case" clause. One more item is vacancy, as it is difficult to keep them rented during a tenant transition. With all of this, do you still have a true $300 each month?

So, now to answer your actual question "should I be able to cash flow in the long run or is this too thin?", I personally feel you can. The MH is a cash-flow machine, like a washing machine at a laundromat, and it depreciates like one as well. Therefore, keeping them rented is very important in your cash-flow game, as they will not go up in value like a stick home. If I could ever figure out the SAFE Act correctly, selling them on contract is a way to capture some "eye-of-beholder" appreciation...but for now I will just rent them out!

Best of luck and please let me know how it goes with this MH.