What To Know About Owning A Mobile Home Park Before Investing
In states such a South Carolina, North Carolina, Ohio, Wyoming, West Virginia, Mississippi, Alabama, Arkansas, New Mexico, Kentucky, and Louisiana, among others, quite a substantial percentage of the population lives in mobile homes according to data revealed in a BBC article [http://www.bbc.com/news/magazine-24135022 ]. As a matter of fact, these are just a few examples of places where you can venture in mobile home business, even though it is approximated that at least 20M Americans live in mobile homes. These figures are quite promising, especially for people with an eye in the real estate business and housing industry. Mobile homes are advantageous in terms of purchase price, alongside the fact that they are quite convenient when it comes to waiting time before you get a new home. After purchasing a new of a used manufactured home, owners have the option of placing the home on land that they currently own, or seek a reliable mobile home community. This is where you should start being keen on what to know about owning a mobile home park before investing.
What are Mobile Home Parks?
Mobile home parks are also known as mobile home communities or trailer parks. They are essentially investment agencies that cater for mobile home owners needs such as a space to rent or lease for placement of their mobile homes, caravans, or camper trailers. Park sites also do provide the occupants with essential utilities such as water and electricity. As a matter of fact, mobile home parks have become a booming business in various states of the US for the past few years, thanks to the various benefits of living in a mobile home. In this sense, let us now look at the advantages and challenges associated with investing in or owning a mobile home park just so you determine whether it can be a fruitful venture for you or not. Below are some things to note:
Benefits: Why Invest in Mobile Home Parks?
As seen above, mobile homes and parks provide a more affordable option for people to own homes or even renting property. This makes investing in a mobile home park an interesting opportunity since you will rarely lack the market. The other advantage of parks is that operating expenses are significantly low, especially since you don’t have to spend much on fixing up or constructing structures like is the case with building apartments or real estate. Your primary focus when starting up is to invest more in land and the utilities that your park community tenants will require. Mobile home parks are also more advantageous in terms of capitalization rate as compared to an apartment building in most areas, especially where the land development potential is somewhat lower. Last but not least, it is easier to evict a tenant who fails to pay up their dues than it may be in the case of site-built homes.
Challenges of Investing In Mobile Home Parks
One of the most common challenges faced by trailer park owners is the fact that financing may be a bit discouraging. In most cases, lenders provide loans at much higher rates and stricter terms in comparison to real estate financing. The owner also bears a high risk when it comes to infrastructure and utilities. This necessitates doing careful due diligence whenever hiring contractors as well as recruiting tenants into your mobile home park. There are also not as many mobile home park management firms as there are realtors and management agencies for real estate, meaning that you may have to do quite some research.
The Industry Is Quote Competitive
As a mobile home park owner, it is important to note that manufactured home owner often have a number of options on where to place your home. There is also a high degree of competition, meaning that you will have to improvise on the amenities you provide your tenants with, especially for an area that has other parks around. Sometimes you may have to go overboard and invest in buying multiple mobile homes to encourage rental tenants into your park.
Mobile Home Park Examples
1: Mobile Home Parks with Financing
Nevada, Oceanside, Huntsville, Clarksville, Bentonville, Millbrae, Illinois, Concord, Lancaster, Lynchburg, Westminster, Beach Park, Burlingame, Westland, Lake Forest, Red Bluff, Bellwood, Huber Heights, Starkville, Arroyo Grande, Maryland, Lompoc, Weslaco, Kalispell, Edgewater, Gardena, Decatur, Katy, Grosse Pointe Park, Oxford, Laramie, Pennsylvania, Sherwood, Deerfield Beach, Amarillo, El Reno, Cheyenne, Moore, Dover, Hastings, Keansburg, Santa Barbara, Ontario, Vero Beach, Casper, Hialeah, Orland Park, Bloomington, Winfield, Walnut Creek, Chino Hills, Connecticut, Susanville, Brooklyn Center, Lincolnwood, West Palm Beach, Front Royal, Albany, Sparks, North Ogden, West Haven, Lake Mary, Hawaii, Montgomery, San Francisco, Douglasville, Valley Stream, Auburn, Delaware, Lumberton, East Wenatchee, New Braunfels, Kansas City, Buena Park, Marysville, Sapulpa, Robbinsdale, Alvin, California, Pekin, Oklahoma, Upper Arlington, North Plainfield, Yorba Linda, East Moline, Norwood, Tyler, Kingston, Georgia, Wilkinsburg, Lackawanna, Berkeley, Herrin