I am considering to purchase a park with 128 lot, 58 occupied and 20 POH. I noticed the plumbing expense is about $2k-$3K/year. Is this a red flag or reasonable expense?I am thinking to ask seller to provide receipts. If seller can’t provide the receipts, what I can do to ensure this is no plumbing issue?
Erudolph86, is the Mobile Home Park Master Metered?If yes, how old are the water pipes?From the Plumbing Expense amount I would guess that it is Master Metered with old pipes.I would try to pin down the Sellers concerning the specifics (age, type) on both the Water System and the Sewer System as these can become big bills for the New Mobile Home Owner.We wish you the very best!
Actually, erudolph86, that number sounds on the cheap side. I don’t own a park, yet, but if you call a plumber out it’s probably $100 right off the bat just to get there. If the number that he’s giving you is not accurate it may be because he is trying to raise the value of his property by showing you costs that are lower than what is real. So, you might want to try to reverse engineer a number if it seems unrealistic, ditto the other costs and expenses. Good luck and please let folks here know what the outcome is.
That sounds like a reasonable annual expense to me for a park of that size.As part of your due diligence you should get all the seller’s bank statements from the past year. Look at the images of the cashed checks and see which are for plumbers. Add it up. Does the dollar amount match what the seller claims are his/her plumbing expenses on the P&L they’ve supplied? Regardless, call the plumber(s) that have worked on the property. Ask them how much they’ve charged the owner. Ask them what the problems are at the park.For recurring plumbing problems for the same problem (e.g. tree roots or semi-collapsed line) you may want to spend a couple of extra bucks (couple thousand actually) and cut down a tree or two, and/or replace several feet or more of old/cracked pipe. It is always good to save yourself money in the long run even if you have to invest now in repairing some deferred maintenance issues. Of course those sorts of needed repairs would be a legitimate basis for a reduced selling price (or have the seller correct them prior to closing).Good luck,-Jefferson-
Everybody,Thank you for the feedback.I think I need to find another park. Called police department found that they received many calls from this community. Also it looks like there is no much job in this town. Quality and hard working people have left the town due to lack of job. What left are retiree, people live on government support and drug addicts.Thanks,Elly