Just curious as to what people are paying for MH’s. Sometimes I think I am too stingy & limit the number of homes I can buy as a result. Other times I think I am not stingy enough and could do better. Recent deals, all being moved to fill lots:
1981 3BR 14x70 in very good shape, could use new carpet, includes mini-garage, $1,400.
We are experimenting with a new mover, as the prior one had some quality issues that outweighed more favorable prices, seems to be the norm with contractors. The new ones are out of Indiana. Moving homes from Columbus to Muncie area run $2,800 to $3,100, assumes complete take-down, lot clean-up, tote, some prep work on receiving site, block & set, including all materials & axles + tires, not including skirting. It gets cheaper as the distance decreases - homes in Findlay/NW Ohio cost $2,200, homes within 20 miles of the parks cost closer to $1,800. These are not bargain prices, but if the mover is on the ball and requires little hand-holding, they are worth it. Given the large price differential for mileage, we will definitely be looking for more homes in Indiana near the parks (Ft. Wayne & Muncie)…that is intially a logisitical pain (getting out there to look at homes), but justified in terms of cost savings ($1,000 per home!). It also means I will not be looking for homes to fill Indiana parks east of Columbus or in the hard-to-access boonies.
Don, Greg & Shawn, thanks for the feedback, it is a helpful guide. I had frankly hoped for more from those of you out there, as I know you are doing the deals, come on, show us some skin!
I have purchased 40 homes in the last 22 months. I have paid as low as $1500 for a 1986 27X80 that needed $20K in repairs ( like new when done) and up to $15K for a 2001 14X80 in excellent shape. My average cost for a 1998 or newer14X80 3+2 in fair shape is $8K. I just bought a 1998 14X80 3+2 today for $3K This home will need $6K in repairs. I personally have seen no consistancy in pricing. I usually offer 1/2 of the asking price to Greentree or Vanderbilt. Sometimes I win sometimes I lose. My best deals come from dealer trade ins. I plan to purchase and market new homes in 2009 if our economy will allow. I have discovered from reading the forum that the mobile home business is regional just like the real estate markets. Prices and demand are different everywhere.
Thanks Ellen & Rick for the additional feedback. Looks like we are doing OK on prices.
Our strategy at present: We have bought in demographically and economically depressed areas. Between the lots and the older homes(1981 - 1995), we are aiming to undercut local rentals and sell cheap, cheap, cheap. Local lot rents, assuming pass-through of utilities, tend to be right around $180 - $200, with a lot of poorly-run, junk parks charging $125 (these are our acquisition targets). Looks like we will have around $5,000 in the homes after a move, with carpet & paint needed in a majority of the homes. We can sell for $500 down, $190 a month for five years, while borrowing 12% IRA money to fund the acquisition costs, and make a modest profit (really break-even after taking repos into account), which keeps total monthly cost to buyer/tenant right around $390, well below local 3BR rentals of $500-$600. The higher end homes (199x 3 BR Vinyl) that we come across will get moved into corporate/REIT parks that pay a $5,000 - $7,000 bounty, making for nice cash-flow Lonnie-style. Bottom line, we are looking to fill lots based on very competitve prices in low-income areas. I’m following Ryan’s (and everyone else’s) posts on filling lots with great interest, as that is our primary goal. Given that we buy for @ $5,000 per lot, $200 lot rent (assuming 35% expense ratio for net rent of $130 or $1,560/year) works out well for us. We’ll keep you posted as to progress.
The homes with negative prices are those that the community owner (where I do deals) paid me to take homes he had received as title turn-ins from evicted residents. With our high lot rent, he gets his money back quickly once the homes are sold, usually in less than six months.
JeffB(MI)…How much work do you have to do in a home that the park pays you $3,500 to take and what is that amount based on. Another question if you don’t mind is what would it sell for when you finish. I’ve taken these types of homes before for free and that is to much to pay so I’d like to talk to them about concessions on materials and labor to keep these homes in the park. It costs $1,500 + to haul them away after sitting there for 6 or so months with no lot rent before the decision to junk them is made… Thanks in advance for your help. Craig(MI)
Craig… the $3,500 home needed about $6k in work, but that was at my cost. Real, proper contractor bids were over $10k. This included new roof, drywall, flooring throughout, etc. So I am into the home for about $2,500, which is still more than I would like to pay, but it is a very nice home.