Buying out of State Question


I am looking out of state. By plane it’s about a 5 hour flight. This will be my first purchase. My question is what is the minimum number of tenant owned lots at 100% or close to that you would recommend for an out of state purchase. .Purchase price is about 500k with gross of close to 80K. It has city water and sewer. Homes are about 25 yrs old. I realize this is a very thumbnail sketch but is this something I should even consider since it’s my first purchase??? I don’t mine the 5 hour flight several times a year.
25 lots about 265 per month.


I don’t know that there is a rule of thumb. You need to budget for those trips and see what that does to your NOI. It’s not the time of the trip, its the cost.

Your NOI now is probably close to $47k. How much are the flights? What does that do to your ROI? are you satisfied with that?


Thanks or the insight but how or why did you arrive at a 47K NOI?


All tenant owned is really nice. For that kind of a price I would also want to know the infrastructure was in good shape and organized with no guess work on what’s going where.

If you’re financing this property, I think you would make your payments but don’t think there would be much left over.

Good luck


That’s roughly 40% expense ratio. It could be higher if you are paying water sewer trash


I think a better way of putting is, your NOI will be around $47k until something bad happens.

Is there any obvious up side to this park? Will you be happy with long term staying about where you are now?

It seems to cost me $1500 – $2000 when I visit my parks, if that is any help to you. I usually stay 5 days or so, because I have more then one park and want to look around a little to scope out the market. I keep careful tabs on a number of parks and buildings in the areas.


Okay being new to this what is the worst thing that can happen to a tenant owned mobile park?


Who knows? Bad things seem to come at you from out of your field of vision. Homes catch on fire. Last summer a friend of mine had a house fire (not his.) Three people died in it and it heavily damaged the homes on either side. Don’t know if they were fixable. People move and sell their homes to people who don’t want to keep them in your park. Last summer I had a guy die in his home and his dogs were eating him before they found him some weeks later. Now no one wants to live in the home. Who saw that coming? Your water bill can skyrocket and after spending thousands to find the problem the leak detection company gives up.

I don’t want to deter you from becoming a MHP landlord but your pro formas don’t always work out as nice and clean in the real world as they do on paper. Sometimes they do but don’t go into a deal that is so tight that it can’t handle the hounds of chaos getting loose from time to time. It is a good thing to have some upside in a deal to offset, well – who know what.

I know it is tautological to say, but it seems to be the rhythm of this business (as well as life), “Things are good until they are not.”


Yikes!!!a guy dying in his mobile home and then his dogs eating him before they find him. I need to start a new topic on the most weirdest things that can go wrong while owning a Mobile Home Park.
After reading that you state but you do not want to deter me from buying my first MHP.

Randy, I need to have a beer with you. I’ll pay for all the drinks just to listen to some of your stories…priceless…


It has become painfully clear that a tenant can really make your life stressful by developing a new habit of flushing hand wipes down the toilet.

When these wipes hit a tiny tree root or crack in the tile 10 feet down. Why ten feet down? Well, they wanted to make it a game of hide and seek when they built it.

On its own is not really a big deal if you wanted to replace that section until you have to get around the meter stands and underground lines to each home. Lol.

I still love it. Glad to be sailing.

Be kind and respectful to the tenants. They are like the waiter that can spit in your soup without you knowing it.

Again, I’m not sure about your water situation. My newest bill was 1k higher because it has been cold there in Kansas. I think they leave the water running more. I can’t blame them. Everybody fears the dreaded froze pipes.

Tree trimming so you can be proactively pruning away the danger limbs


My parents used to say, “You can’t hurt the dirt.” The risks are small but they are there.

Drainage problems
Contamination problems
Bad Area / Bad Economy (or “goes bad”)
Code or Regulatory problems

Your tenants die off or move out and the homes are not worth buying at any price.

A “bad seed” starts to encourage retention problems or lead tenants in “revolt” against your vision for the park

Animal problems, such as stray dogs, or cats (we have had both of these problems)

Problems with City Hall (e.g. not working with you, working against you, or harassing you or your tenant base)

Not to mention all of the capital improvements that you need to put in over the “lifetime” of the various elements

Road repair - this is a huge expensive CONSTANT issue.
Water & Sewer pipes – excavation and replacement when trouble arises (how often?)
Electric pedestal upgrades & underground trenching

At the bottom of it all, a MHP is a plot of land with the utilities and parking. You have to maintain & repair all that and that (capital reinvestment) is a cost of doing business that is rarely talked about in this forum.


To me, having to fly 5 hours for a 25 lot park doesn’t work. How can you have an on-site manager with a 25-space park? And how do you manage a park from the other side of the country if it doesn’t have an on-site manager?

If it costs $500 round trip (in advance, $1000 short notice), and hotel is $120/night for three nights ($360) and meals $30/day ($150 incl. travel days), and your manager will give you rides so you don’t need to rent a car, each trip will cost around $1000. If you did it 4X a year, it will be a fairly large expense as a percentage of rents.

For your first park, find something closer, preferably something you can drive to. Try to get at least 40 lots. Use direct mail to reach owners, followed up with phone calls. Mail and call each owner quarterly until they sell it to you or they sell it to someone else.


Thanks everyone for your replies. Brandon I will start a new link for what can go wrong in the so called “perfect park”…all tenant owned homes with city sewer and public water

Marc excellent advice I really appreciate that and thanks for putting me in the right direction but why 40 as opposed to 25 lots. Whats wrong with 25 lots that I can drive to? What’s the furthest driving distance you would recommend for my first park.


My rule of thumb is about 7 hours drive-time. Why? I can quit working on a Friday afternoon, and be in a hotel near park by midnight IF I HAVE TO. I can spend all day Saturday there and part of Sunday, then drive home. Done it many times. Not a big deal.

But I won’t do that with less than 35-40 lots minimum. There is not enough money with anything less if you are really doing your boots on the ground management and getting to your park regularly.


Thanks Zepp, but what exactly do you do for a full day when you visit an all tenant owned park?


You might be trimming trees.
Making trips to the dump cleaning up for spring or fall clean up
Inspecting the grounds
Making lists of house keeping items for tenants
Replacing a section of sewer
Upgrading water pits
Managing your onsite person as to expectations
Checking to make sure people have heat tape plugged in and working before winter
Meeting plumbers and other tradesman you may need to do business with.
Take your banker to lunch
Inevitably you will have a vacant home to deal with. You will need to have someone you can call to turn it around or help fix up a unit when you get a vacant lot.

It all depends on current condition. If you don’t have to fix and upgrade anything then you won’t need 4 visits. Maybe just one or two per year.

Good luck
Ken Lavoie


I agree with the prior post: 40 units is a good number to work off of; otherwise, it’s hard to justify the travel time and expense off of a 25 unit revenue base.
A first park can also be considered a hobby of sorts: being that it’s your first exposure to this type of real estate, you may not mind the travel time and will justify (to yourself) the added expense.
In my opinion, you will be visiting the park more than 4x/yr. As stated, things go wrong, and if you are your only Boots on the Ground, well…
Alternatively, you can consider this geographic area as your base from which to expand; in that case, consider your travel expenses as your “investment” for future growth.


I used to think that I would be able to buy parks outside my state until I bought my first park which was actually in my state. It was then that I noticed that it’s tough to manage something so far until you have a few parks under your belt. Even though you might have a manager things happen often that it’s just better to be closer to take care of those issues especially if it’s a park in bad shape.