In 2015, which states are the best to buy a MHP in?
We consider all 49 states to be fine (Hawaii has no parks), but we always urge caution in the southeast unless you are in a major metro market, due to perpetual problems with low housing prices (it’s hard to be in demand for affordable housing when single family brick homes are $35,000). We are in the Midwest and Great Plains, but that’s because we live there and understand these markets well. If we could turn back the hands of time, we’d have all of our parks on the beach in Los Angeles, at $2,000 per month rents. Since we don’t have a time machine, we will stick with the markets we’re in, but have no concerns with the Northwest, Southwest, Northeast and Southeast, as long as you use correct due diligence. Two areas that are changing in 2015, in our opinion are Michigan (finally able to get good bank debt there) and parts of the Southeast (where labor is the least expensive in the U.S. and many plants are relocating there – even from overseas).
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In most of the books I’ve read they say there are landlord friendly states, 15 was the number but I never got the list. Most say they will not buy in California due to the potential for rent controls and tough environmental restrictions. Trying to learn more about this as Cali is my home state.
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Hate to say this in public but most red states are the best places to buy parks and have less tenants rights. Being in OK with all counties being red it is the most landlord friendly from all the states we have experienced. I am not saying buying in Mississippi, Alabama etc is wise since their rates are way behind–our rates are up $335 per month and some large cities maybe fine.
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Carl
what does it mean?
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I am a broker and multiple park owner in Indiana. I have many MHPs that list at 11caps or higher. I think it’s a great state to invest. I’ve never felt the need to invest out of state with deals like they are here. Financial returns wise, the Midwest seems like a good choice.
Trent, please sent me information on your GOOD parks since we are familiar with Indiana and would like to see what you consider good choice so we can invest.
Hi Carl. I have a good deal for you. $960,000. 61 lots. 45 homes. Only 5 park owned. City water and sewer. Small town. Direct bill to residents for electric, water and sewer. $250 lot rent (not much room to increase it in this small town). $139k gross. $104k NOI. That expense rate includes $5,000 for management and a couple thousand in one time costs. And he’s paying $12,000 a year for the trash. That’s crazy. This is a park you can take to the bank for long term financing at a low rate if you want to go that way. There is upside of you want to fill the park with 16 more homes but I’d really check into the demand in the area to see if that makes sense. So this isn’t a turn around play. It’s a great park for a new investor with some down payment money or a big player that wants to add a medium sized park to their portfolio with low cost financing and not have many headaches. So… Seller financing … Right. Life can’t be that perfect. Come on. He wants to 1031 out of this so that would be tough. I have full price offers if he wants to seller finance. I’m very creative I think. So we are discussing some seller carry for down payment money and taking the rest to a local bank. We will see. This is an active deal right now. You can get a brochure at www.wiselycr.com or call me at 317-844-4684 or you can email me to get detailed financials and to get on my buyers email list for future deals at trentconaway@yahoo.com. I take pride in my pricing strategies. I own parks too. I don’t take listings if the price the seller wants is out of line. I would LOVE to talk all day about everyone’s ideas about pricing. We can use this as an example if you want. Let me know if something is out of whack with my logic. I don’t want to use this forum to just try to talk about my deals. I have had calls all day long on this park without posting it here. I want to be part of the community and add value. I hope this counts as adding value and not just talking about a park. I think I can learn and teach here. I am a buyer, seller, owner and broker. Someday I’ll talk you into seasonal MHPs (they are my favorite) and Campgrounds.
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The post is over 5 years old. I wonder how much this exact same deal costs to an investor today. Im interested in buying my first multifamily and I would like it to be a MHP to manage long distance. About 80lots.