Remember this line, “If you bait for rats, you will attract rats”.
I recently tried to sell a 1983 model 14x70 3 bedroom with a bath and half for $1500 and couldn’t. It even had vinyl windows! Problem was it needed floors throughout and I couldn’t find a capable buyer even at that low of a price. What I was attracting was folks that wanted to know if they could make payments on the $1500! That’s what I mean by rats.
So I repaired the floors and installed new floor coverings and made it a decent house and sold it for $7000 cash and got a great family to boot. They couldn’t get me the money fast enough because they were afraid someone else would buy it out from under them.
Did a similar thing with another house in the park, sold it for $7500 cash. Nobody really wants to live in junk…well except for rats.
When you try to sell a fixer upper you will get the bottom of the barrel buyers usually and as Jefferson stated, they lack the ability to fund and see the project through and will many times make it worse because they don’t know what they are doing.
I will typically spend $2000-$3000 in rehab costs plus $1800-$2300 in floor coverings. I probably over rehab though as I usually will upgrade all the fixtures and cabinet pulls to brushed nickel. I have accent walls in the living room and master bedroom as well.
My park needed quite a bit of turnaround in residents and reputation so these are the steps that I have taken to attract a higher quality resident. I’ve done 3 rent credit deals like this this month all for $2000 down/$575 per month on model years ranging from 1987-1995. I also have 2 more homes already spoken for that I am setting up.
FYI, I’ve bumped my rent credit agreement repair clause to $1000 and tell them that unless the Furnace or A/C goes out it’s their responsibility. They know what I’m providing is a good deal for them and I’ve gotten no push back on this.