I’m closing next month on a small deal. It’s one mobile home rented out and two additional spots rented out. It’s in the city limits, public water, public sewer. Grandfathered in as a 'non-conforming" property. Two spots rent for $175 each and then the home that comes with the purchase rents for $500. Total gross monthly income of $850. Purchase price of $46k. Taxes are $1,253 annually and the water runs about $150 to $200 monthly. I’m thinking a cap rate of around 15? I’d love to hear input on whether I made a good deal. I will say that land values in this area are increasing.
All that said my questions are really about insurance. What type of policy do I need? I’m thinking about all that could happen. A tree falls on one of the tenants homes, am I responsible? Should I require that they have some policy of their own? Personal Injury? Looking for some guidance here. Thanks in advance!