Sure, you can buy a mobile home or you can buy land, but when you put the two of them together in a land/home deal, then, friend, you’re talking about serious investing. This hybrid investment takes two types of investment properties, puts them together, and creates value that wasn’t there before. The deal can go down a few different ways:
1. Buy a mobile home and put it on land you already have
2. Buy land and bring in a mobile home you already own
3. Buy them both individually and stick them together
4. Buy them as a package already together
Here are some of the reasons we love to create mobile home parks with land/home deals.
1. Mobile home investing is a still relatively undiscovered type of real estate investing. You won’t be competing with the “I Buy Ugly Houses” crowd or the “No Money Down” investors fresh off their late night infomercial training. With less direct competition, you won’t have to fight so hard for the sweet deals that pop up.
2. You have less money at risk with mobile home investing. Most mortgage payments will land somewhere in the $200 to $400 a month range, which is a far cry from the $700 and on up numbers you typically find in traditional income property deals involving a residential home. Your cash flow on a mobile home is going to be about the same as with a single family home, so why take on the extra risk?
3. We appreciate appreciation. We got into this business for cash flow and refinancing possibilities. As with all correctly executed real estate investment strategies, any appreciation in the value of the property that happens along the way is simply icing on the cake. Our experience has been that double-wide land/home properties tend to appreciate at the same rate as traditionally built homes. Bonus for the mobile home investor!
4. Demand is good. Let’s face it. Mobile home properties are usually considered the target market for lower and lower/middle incomes. Good housing market or bad, the demand for these rentals stays consistent. Consider the recent recession. While some of the luxury and high-end places might have a heck of a time staying rented, the same is not true for mobile homes. They stay rented just fine and expect to do even better the longer the present financial crunch continues.
The Commercial Investing Center Team
(Flickr / mansionwb)