Met with an out-of-town park owner who is burnt out on managing his 10 rentals (park is 32 units + 4 park model units. He has 2 vacant park model units). PM offered to sell 10 rentals to me and threw out a price of 75K (I know without looking at the units that is more than I’d pay, but I’m sure he’s negotiable).
Lot rent is 210 (though I’d try to negotiate that), and includes water and trash. He is actively seeking to meter his water and said he’s apply the funds raised from selling his portfolio towards the meters. He is getting $425-$450 for rents, but believes (and I agree) rents could be raised.
He also mentioned he was interested in my possibly managing the park. It’s my understanding that one has to be a licensed property manager to manage someone else’s real estate in NC. Is this true for parks, or is there a way to get around this? Managing seemed attractive to me because I’d have my own little LD fifedom & it’s not far from my house.
If anyone has any thoughts on this, please do share. I am a green landlord but learn quickly. PM just wants to get his lot rent & doesn’t have to worry about anything. We did not discuss payment, but I’d assume 10% gross rents would be fair.
I know what some of you are thinking…just buy the freakin’ park. In our conversation, the park manager mentioned that he wished someone would come along and buy the thing from him for 2 million. He said he has a large mortgage on the park. It is prime real estate. Developers are buying land all around him, and the park is well-situated. On the other hand, he seems motivated. He co-owns park with 2 brothers & does all the work. He lives in FL & park is in NC. He is aware the land is valuable. Still, there might be a creative way to buy this thing that’s reasonable for me?
Positives of buying rentals.:
12 minute drive from my house
Manager doesn’t care if I rent, lease/option, or sell homes
Park has great location relative to town & shopping (ez to rent)
All units have tenants
Manager claims he has a waiting list of renters (seems plausible).
All 2 bedroom units, plus 2 @ 1 bedroom.
At least 4 units have existing underperforming tenants on mo-to-mo leases.
3 brothers own park, one is dying, & park could be sold soon (PM has indicated we could have a stipulation that he’d buy units back at a “fair market price” if park is sold, but that value seems arbitrary to me.
This guy has had hired managers in the past and seems pretty stressed out by having to travel up every month and manage it himself.
I am definitely looking for a park and wouldn’t mind owning this one. Or just owning 10 rentals close to my house and possibly getting some management experience sounds attractive.
Anyone have any thoughts on how I might buy the park, whether or not to buy the rentals, or whether I can (or should) manage this dude’s park.
Post Edited (04-02-08 04:39)