New owners of manufactured home communities can’t be blamed for being optimistic. They may own a 100 space park and only half are filled at purchase (not good) but are certain it will only be a short time until occupancy is full. At MHP Listings, we’re big fans of optimism but don’t forget to mix in a dose of reality before you sign on the bottom line and spend a few million dollars for a mobile home park.
Depending upon the local market, you may think that manufactured home communities should be able to be infilled in short order. Maybe and then again, maybe not. Don’t psychologically beat yourself senseless if you think you should be at 90% occupancy in two years and you only hit 75%. There are more years coming up. Trust us on that. Maybe the slowly increasing rate of occupancy is your fault but maybe it’s not. Maybe the market got soft. Maybe you were way too optimistic in your projections.
If you’re doing all that is humanly possible, the only choice is to become inhuman, and nobody wants that. Don’t forget that there are other ways to create income in manufactured home communities. We’ve discussed some of them before. Bring in vending machines, a laundromat, or video rentals. These are some high profit services that it’s very likely your tenants will take advantage of to varying extents.
And you can always raise the rent. This works better if you’re only renting the spaces and the homes are privately owned. The $3,000 cost of moving a manufactured home prevents most people from leaving inn a fit of pique.
Nobody ever said this was easy but it sure beats a real job, right?
The MHPListings Team
Flickr / Dave-F