I hope this thread will prompt those who have found effective methods to deal with following issues to post- I have noticed these issues have been pointed to as reasons for high turnover of residents and lack of sales in replies, but I have not read much in the way of tactics to use to avoid these pitfalls.
1.) RE: financed MH sales- LD’s; people here won’t buy unless it says how much down & how much per month on the ad.
2.) There is no use in asking-people here won’t ever have a big downpayment.
3.) In reality the “buyers” are just renters - they won’t maintain their home and will move out on a whim.
4.)Buyers will not buy homeowners insurance, unless we include it in the payment of home.
Shawn I’m not sure if you were listing what you saw as the common problems OR if you were giving your opinion as a response as to what the common posts are.
Anyway, in response to #1. I have sold two land/home packages this year both with $4k down and another with $5k down for 3 total. I have also sold 7 lots, 3 @ $2500 down, 2 @ $3000 down, 1 with $5000 down and 1 for $1000 where I was working with a local dealer (rare). I also lost a sale the other day with $5000 down on a lot because of a recent theft that changed the mind of the buyer as I mention in a post on 6/23. I have not closed on every other buyer that came my way either. I have had others with money to put down; I just haven’t closed the deal. I have one more home that I am putting in now and I have had interest before I’m finished and I expect to get at least $4k down again. I have sold as many homes as I can bring in (investors hello).
I am not doing Lonnie deals and am trying to find “nicer” homes that will last a while and have more appeal. In other words, I’m trying to find buyers that want to be between a lower end manufactured home and a lower end site-built home.
As far as people leaving, I’ve sold about 10 homes in the last 3 years and have the original people in all of them. I’ve only had real problems with one paying but he has caught up. I had 23 apartments in 4-plexes and a 3-plex over the same period and probably had 100 tenants and was basically a nightmare with people leaving whenever they felt like it and was even thrown in jail because I was arguing with a tenant who didn’t want to pay and was trying to leave without paying me (cops felt sorry for her basically). I don’t want to get started with that but it’s another reason I prefer ownership over renting. If they leave with ownership I don’t lose as much because they left me a nice down payment. Or if they don’t pay it takes 45 days but I can remove them - not much longer than a renter. With renters the deposit doesn’t cover damage or time consideration/vacancy period with fixing it back up and starting all over again. And at some point I want them to leave so I can do it again (but I don’t set it up for them to leave; they will leave eventually as their life changes but hopefully it’s after a few years.)
I’ve done both approaches with providing insurance and letting them get their own. If you get too many homes in your name you will be capped off with one insurance provider. I haven’t tried another company yet but I didn’t really want to have too many in my name. It was a battle with one to keep her insurance active but I just kept at it.
At times I can see why Lonnie got tired of the real estate/tenant side and went to just dealing with money… I still believe in the business but I believe even more in the ownership side than I do renting.
Before I started doing land/home packages - similar to Tony and Scott - I was only providing the land - as the previous owner/developer of the subdivision started. The previous owner was selling land with $0 down and I also did that for a while and that was a problem. People took it too nonchalant and I had people leaving before they made payments sometimes. The point is I made it too easy for them. The same with a renter situation or selling with nothing down.
I think we should start to see even better buyers/occupiers with common cost of living expenses getting too high for fixed incomes. How can they not look for something more affordable than where they are? Even if there are a lot of foreclosed site-built homes that are cheaper than they were when originally built or purchased, they still are more expensive than this product in most cases and/or the taxes will most likely be higher. But I believe it has to be a decent product provided for them also or you will attract more problems with it.
Thank for the input Sam. How about sharing mathods used to get down payments, and also to get better buyers that keep their agreements.