It is most impressive, even humbling, to hear of the returns fellow investors are realizing, of Lonnie-Dealers who speak of stratospheric “good-enough” returns, all due to diligent efforts. The recent posts under “M.H.Prices” were particularly enlightening, educational for me. Extrapolating the costs of acquisition, renovation, selling or renting leads me to conclude that the investors will not only achieve a handsome return on their dollar, but also that their short-term loans to their purchasers assures a return of their monies. Just think of Don (NY) who recently bought a twelve-unit park for $50,000. Extraordinary! Or consider one random of many examples, the purchase of a 1991, 3/2 14’x70’, in immaculate condition, for $5,000 by John Hyre! The post contributors’ business acumen put mine to shame. Depressing? No, No! Their achievements are invigorating, educational. Their return on and of their capital is inherent in their purchase. Ryan, Tony and Scott, Ellen and John also come to mind, who furthermore do their own renovating and thereby enhance the profitability of their investments.
In another equation–Alexander and I bought DW’s for $10-to $17,000, hired out the renovations, and when the homes were ready for market, they cost $22- to $27,000. Three of the homes are sold on a fifteen-year term, and the others are kept as rentals. The return on capital is about 20%, but the return of capital is at least questionable. If it had not been for the good counsel of Bo Shomansuroff (Mobile Home Concepts), we probably would be in worse shape. (I would highly recommend Bo’s services to anyone). After attending Tony’s and Scott’s bootcamp, we also learned that we were “gold=plating” our homes. In light of the fact that our country is bankrupt, have obligations far exceeding our ability to honor our debts, the Feds, the banksters with their subcrime allies will choose to print dollars until these notes have reached their intrinsic value and the presses run dry. That is the definition of mega-inflation! None of us will be immune from the historically inevitable. Therefore, it would behoove us to consider the return on and of our capital. The rule of 72 does not allow for hyper-inflationary effects.