When older mobile home parks are bought up, investors want to raise the lot rents to “market rate.” How is that rate figured out?
What is the overall mathematical method to figuring out the percentage to increase “market rate “ mobile home lot rents for any USA location?
How are regular apartment and house rents relatable to increasing mobile home lot rents in a region?
Sorry if this wound up in the wrong section. The drop box would not allow for adding a new topic title.
Hi Shamrocks -
The non -mobile home market survey gives you a baseline for the immediate area of housing prices for rentals as well as purchases.
The market survey, if you want some help on that feel free to give me a call 253-632-1846
It sounds like you’re asking about market rate lot rents. Market rate lot rent is set by all of the comps of lot rents. If there are no comps then you’re going to hard time with your mobile home park. Otherwise it’s just the average of what everything else is going for, multiplied by a factor related to how you compare to everybody else in the marketplace.
What I think you’re really asking it’s how you set lot rate versus home rental rate versus the surrounding market, and the general of thumb I have heard is a three bedroom mobile home comps to a two-bedroom apartment. Subtract out the cost of the home and you have the cost of the lot.
This speaks to the crux of the issue which is how do you back out the monthly cost of the home, homes have different costs and all markets are different etc etc.