Hello everyone,
I am new to your website and I am very interested in getting into the MHP business but after reading most of your posts I have not found what the down payment requirements are for a typical park. I am looking to put down about 400k on a park throws off some decent income. What price range should I “realistically” be looking towards…?
It has been very informative reading all of your posts.
Thanks in advance for your responses,
Joe
Joe -
Most banks will want to see 25% DP. 30% is not unheard of. Seller financing varies widely - you may be able to get away with 0% - 10% DP. Assuming 25% DP, then your $400k translates into $1.6mm of ‘buy power.’
However I’d definitely hold cash in reserve to buy mobile homes. In all but the strongest markets you’ll need to purchase probably at least 15% of the inventory in your park over the next 3 - 5 years. Don’t get caught flat-footed with no cash to buy a home. The mobility of homes varies by market (the less expensive are more mobile). In Oklahoma we lost a home two years ago because Vanderbilt moved it out in two weeks from when it went vacant and we were not proactive enough in negotiating to buy it.
Best,
-jl-