All Forum Posts by: Robert Lindsley

Hi there,

I have been interested in mobile home parks for a while.  Over the past year I've been researching and running numbers on multiple parks but haven't found anything that financially makes sense.

Last week I found a park that looks to be an ok deal.  It's a small park (17 units) and it's cash flow positive out of the gate and has seller financing (a huge plus for me).

But after doing some research on the park, I found some concerns:

- 3 months ago, a couple was arrested for making meth in one of the homes
- There's a level 3 sex offender living in one of the homes

The park definitely needs cleaning up, but those two things so far are the scariest to me.  I have no idea how to even approach these issues.  

Can I kick these people out?  What can I do with the home that the couple was making meth in?  Can it be 'cleaned up' or should I just junk it?

Any park I buy, I would want it to be a place where good, family oriented people could live.

Here are the financials:

Purchase price: $164k

Finance amount: $129k @ 6% for 20 years

Monthly income: $4,480

Monthly expenses: $4,022 inc:

- Repairs 7%
- CapEx 7%
- Vacancy 7%
- Maintainence 10%
- Taxes $1142 per month (yikes!  This is the scariest financial expense)
- Water $462 per month
- Mortgage payment $923 (seller financed)
- Misc other expenses

I'm going to try to figure out a way to lower the taxes.  Also I'd like to try to see if I can meter the water individually removing that expense.  Finally, I figure if I can clean up the park I can begin the process of raising the slip rent making it more profitable.

What do you think?  Is this something I should put my time and energy into?  Is it worth it given that I have to deal with sex offenders and people cooking meth?

Thanks!
Robert.

Hi @Account Closed.  First off, I'm sorry for your loss.  I hope you and your friend are doing ok.

There are a million people on BP with more experience than me, but wanted to give you my perspective.  First off, what type of return are you looking for?  8%, 10%?

If your goal is to build an empire from cash flow, you're going to most likely be interested in buy-and-hold commercial or multi-family properties. Personally, I wouldn't mess around with SFR -- the ROI generally isn't as good as commercial/multi-family properties.

If I were you I would start with multi-family properties 10 units or larger.  You'll want to find properties that give you a great cap rate.  You may be able to find those locally, but personally, they could be a thousand miles from me and I wouldn't worry.  As long as you have a good property manager in place, you're in a reasonably good neighborhood and you have solid tenants, you'll be fine.

You could also pool your money and buy larger complexes. That's a little out of my league but I know there are quite a few services that do it.

Best of luck to you!

Robert

Welcome @Cydy Palang to Biggerpockets.  You're going to find tons of great information here.

I would also encourage you to figure out how you want to get into RE investing.  Listen to the great podcasts here and elsewhere, jump in the forums and learn as much as you can.  And remember it's always ok to change your mind and re-focus as you learn new things.  I originally thought I was going to be a flipper, but realized after months of learning that buy-and-hold was the right strategy for me.

Best of luck to you!

Robert.

Hi Cynthia,

I just sent you a collegue request with additional information.  Please let me know if you'd like to chat further.

Thanks!
Robert.

Hi Cynthia,

That's great news.  I'll reach out to you later today with a one-sheet and specifics on the property.

Thanks!
Robert.

Hi Chi,

I ended up using Jay Hershman, working with Joette Trinh.  She's terrific!

My costs ended up being higher because my property is technically commercial, but you should call her and get a quote.  She's very responsive and is doing great work.

Let me know how it works out!

Thanks,

Robert.

Hello!

I am in the process of buying a multi-family investment property and am looking for an investor to help complete the funding.   The property is cash-flow positive out of the gate.  To complete the acquisition I am looking for an investment of $45k.  I can pay solid returns and am very flexible on terms.  If you're interested please reach out and I can share additional details.

Thanks!
Robert.

Thanks @Chris T. and @Anthony Susco.  I agree.  I need to get funding lined up asap but I'm going to continue looking.  Hopefully I won't need to go down this route at 12% - I certainly don't feel like with those terms there's any interest in them becoming a long-term financial partner.

FWIW The deal is terrific. Cap Rate of 11.18% with a cash on cash ROI of 22.06%!

Thanks for your thoughts on this!  I definitely need to keep looking.

Robert.