All Forum Posts by: Vicky Blacknall

Davin,
I would suggest as learning tools, to get acquainted with your local REIA and some area investors. It's really hard to begin without at least someone who knows the area and is willing to help you ask the right questions before investing. Better yet, you might meet a mentor.

Vicky

And you do know that he can get and interest only payment and have the money that would have gone to the principle put into an Rooth IRA account that is yielding 8%. I say if he does that and everything works out nice and dandy he will be able to pay off the mortgage in 10 to 15 years and have $1,100.00 positive cash flow a month.

Calixto, I'm interested in how this works.

John,

Thanks for your reply. We initially approached the sellers with carrying the note, but absolutely no interest there. Not even partial. The bank that has the note now has said they will be interested in lending to us. We still need to do a pre app. and submit a business plan.

We definitely are not interested in running a restaurant and probably not a motel either. Will either sell or lease buildings.

The part about waiting until the cash flow has been established is a strategy that we are playing if they insist on a price higher than 10% cap rate. It's basically a waiting game. They aren't getting any other offers. Hmmm. I wonder why????

Vicky

Hey All,

I love this site. The generosity of pros is astounding. Plus, I like the different opinions that provide different things to think about.

Hubby and I have been looking and working on purchasing a small MHP+ for 6 months. Seems the RE agent is rather, shall I say, um, an air head. So, after we submitted an intent to buy, which was flatly refused with no negotiation, we found a commercial RE agent to represent us. He is wonderful! He was able to get information we couldn't. That plus what we dug up, gave us a good picture of what is going on with the place. Plus, we continue to pick up info from locals.

There are 8 pads and all are filled. But wait before you think that's good. Only 4 are paying tenants - 2 pay for the lot only and 2 for MH and lot. The others are not rentable and need various degrees of rehabbing.

There are two pieces of property involved in this deal. The larger acreage has an older abandoned restaurant and a 5 room + manager's quarters motel with 2 squatters.

The whole place is trashed and will take some time and SE to just clean up. What helps to make the deal sweet is the Public Service Electric Power Plant is in this town and they do a huge amount of contract work and need housing. Plus the town is rent deficient. In addition, it is the next town in line to grow from a bursting metropolitan area. (Lots of people are already migrating.)

So, here are the numbers. $1200. income on the 4 Mobiles/Lots. Potential for Mobile Home Park with other 4 mobiles rehabbed and rented: $3600.00 There is room for 4 more pad with easy utility access. We will likely put some cash into the Restaurant and Motel buildings, (both sound) after getting the Park up and running. We are looking at selling both or possibly renting out. The seller is crazy and is asking $210k. We are contracting for $150k tops.

Any advice or input will be greatly appreciated.

Ok, here's my figuring:

Carrying note @10%:
$16k investment
$39k gross return (roughly)
$23k net ROI

Rent @ $300 mo:
$180 per mo after 40% expenses
$21k net ROI
More hassel

Of course, this doesn't include a mortgage, and $300 positive cash flow for a rental is mighty good these days (generally around here the cap rate is 10%). So, the difference would be substantially greater.

Does this make sense? Am I missing anything?

Vicky

Wow! great discussion Mike and John. One of the reasons I'm a little uneasy with rental is the ROI. I just figured I wasn't figuring right. (Pun not intended.)

Years ago, we sold our paid off 11yo mobile and 1.5 acres, carried the note and made money on what was then called a "bad investment" meaning the purchase of a mobile home. We had 16k invested, sold the place for 25k at 10% compounded interest for 10 years.

So, can you help me out by using this example and show me how to figure the difference between what our ROI was by carrying the note as opposed to renting for ten years using Mike OH's expense theory?

Thanks for your help.

Vicky

John,

We do expect to bid in the future with the intent to buy. Some investors got some really good buys. We did a consult with an attorney and learned more about quiet title action. From the posts here, I'm thinking some reading is in order. Do you have any suggestions?

Thanks for your reply.

Vicky

Hi!

I'm posting on this old thread because hubby and I are also interested in purchasing a mobile home park. I'm a little nervous about how tight the numbers are and would like some critique if anyone cares to jump in and give advice.

The park is small with 8 pads, an old run down, but sound 5 room motel building and a similar good sized restaurant building. There are only 4 occupied mobile homes in the park, two of which are owned by the landlord. There are 4 unoccupied mobiles, two of which is not in terrible shape, one of which we are puchasing for $750.00 and will rehab and rent. The overall income with the motel rooms renting as they are apartments is $2100.
Therefore, the owner is asking $210,000. We are offering $150,000. with $20,000. down and owner carrying $130,000 @8% for 15 years with a balloon in 3 years.

The improvements sit on 5 acres 2 blocks off a major state hwy and the town is the next stop in booming growth. The city has been preparing for that growth by expanding the water/sewer system (which by the way all the improvements are on the city system). And, I have heard from 2 realtors that the town is hurting for rentals, which after scanning the place and knowing some of the industry seems to be true.

Any comments or formulas would be greatly appreciated.

Vicky

Ryan,

Do you use land records for in area comparable sales?

Vicky

3. Pretty much everything a standard investor should know, basic market information as well as possible buyers. Network like crazy and you should be fine.

Jbalinvest,

Sorry to ask a dumb question, but what do you mean by the term "network"?

Vicky