A long-time resident at where I'm now living told me when a previous owner (that went bankrupt) started accepting HUD tenants, "that's when the drugs came in" (I wasn't living here then to be able to confirm this assertion, but I have no reason to doubt it).The same reaction happens in business ("street fighting" and "lifeboat ethics").

I obviously don’t condone drug use in the house and don’t want him scaring away prospective buyers.

but I will take a guess at what your askingif the developer is going to bust this into lots and you stay in you just lost your tax advantages and will be deemed a dealer at the highest tax rates.sell now no risk.. and best tax treatment you could 1031.if its one property and your saying should I partner and they are going to build an apartment on it and we will keep it.. that's different.. but you lose control because your now going to put a massive amount of debt on it.. all though in your area not too risky given market conditions.. and really depends on your developer  known, reputable and stable ?

I was the kid in high school getting offers from private colleges over how high my test scores were, and I ended up ruining so much with drugs, toxic emotions and bad decisions. 

Is it a place where people are making very little money and have none left over, or is it a place where there are open air drug deals during the day and cars broken into every night? 

You could also speak with a local manufactured home dealer in the area. 

"Bob-The Son" gets hooked on heroin, vacates the property, returns to steal everyone else's stuff to pawn for drugs, gets arrested and goes to jail.

I am a Photographer who also does high quality print work and framing for interior design dealers, and the occasional art gallery.

Shaun, absolutely speak with a local attorney but a few things I would say from my experience in NC:-A notarized bill of sale for buyers is sufficent in many places for residents to have utilities turned on w/ local providers, so that should give all parties comfort regarding its legitimacy-The counties where my parks are located, a title is required to move a home, so they shouldn't be able to move the homes from your park-Depending on how "by-the-books" you want to do it, a mobile home dealers license is required in many, if not all states, if you're selling above a certain # of homes in a given yearI hope this helps.

The small town rumor is that dude is the dope man and he has a laundry list of small-time drug and some more significant battery convictions already.