Investment Info:
Mobile home buy & hold investment.
Purchase price: $50,000
Cash invested: $6,000
Bought a vacant lot for $6,000 cash. Borrowed $50,000 from a private lender for 10 years at 5%. Picked up a free 3 x 2 manufactured home and moved it to the lot. Installed a new septic system, fixed up the manufactured home and rented out. Currently it rents for $1,300/month and is worth around $200,000 to a retail buyer. Keep in mind we did this deal in 2013 so the market was much different than today!
What made you interested in investing in this type of deal?
This was one of my first deals. I had to start somewhere and the timing was right.
How did you find this deal and how did you negotiate it?
The lot was on the MLS the price kept dropping from $50,000 to $40,000 to $30,000. It was bank owned and there was drug manufacturing going on at the property previously and the bank had to clean up the mess. This scared off a lot of buyers. We just lobbed over a low ball offer and the bank took it!
How did you finance this deal?
Private lender.
How did you add value to the deal?
We had to install a new septic system and find a cheap house which we did. The mobile was "free" to we had to move it and fix it up (new roof, new carpet and paint, appliances, ect.).
What was the outcome?
We have been renting this place for $1,300/month for over 5 years now.
