We’re trying to turn around a neglected park. As part of our efforts, we’re planning to bring in some newer homes. I found a good deal on a 16’ wide 2002 model that looks good and really dresses up the park. We don’t want to own any homes, so we’d like to sell it asap. In the interest of attracting more buyers, we’re trying to keep the price low enough that it just covers our costs.
We’ve had a lot of interest, but every serious buyer (with $$$) wants to know our 'bottom line cash price" and they all intend to move it out of the park. We’ve invested a lot of effort in finding the home and getting it set up. We really don’t want to lose it. I understand that once it’s sold, the buyer can do whatever they want with it. Or can they???
When searching for homes, I’ve come across many (most) for sale by parks that require the buyer to keep the home in the park for at least 4 years. I spoke to the manager from one park and asked what would happen if the tenant violated rules and was evicted. He said they were still obligated to pay rent for 4 years.
I spoke with my attorney about the matter and he said that if I bought a home directly from someone who purchased it with such an agreement, I’d be free to remove it and the park would have recourse only against the person who agreed to keep it there for 4 years.
I think some of the problem in the area is cheap land and lax regulation. We’ve lost 3 homes from the park when they were hauled out by a dually pickup truck. Illegal, yes. But nobody seems to care.
I’m wondering if there are any creative ways to sell the homes and keep them in the park. I realize this comes across a bit like wanting to have my cake and eat it too - I don’t want to own the home, but I don’t want to lose it from the park. Still, if there’s an effective means of accomplishing this legally, I’d like to know. We’ve thought about rent credits and would do that if necessary, but we really want to avoid rentals if at all possible. We’ve talked about having buyers sign a one-year lease, but if they sold the home, the buyer would not have to honor the lease.
The only real solution we’ve come up with is to put a price on the home that would cover replacing it if it’s moved. But if we could figure out a way of keeping the lot rent (our ultimate goal), we’d like to offer the home at a lower price (our actual cost). I hope that makes sense.
You’ve done good research and have already answered your own question.
I’d mark-up the home above my costs. I’d make any buyer (especially an all-cash buyer) sign a multi-year lease. And I’d be very upfront with them that if they have ‘that kind of cash’ they’d do better price-wise to buy from a local dealer. I explain I’m not a dealer.
If they pulled the house and did not continue paying rent, I’d pursue them to the fullest extent of the law.
My 2 cents worth,
-jl-
Why do people want to buy the homes to move them out? They can just as easily already buy them up and on wheels from repo lists or websites like MHBay. Is it other park owners, or is it the end user? We don’t see that phenomenon in our parks, and I’m trying to understand what makes your homes so desirable that people are beating down your door to buy them and pull them out over buying them outside of the park.
Thanks for the input. You’ve pretty much reaffirmed my thoughts, but I wanted to present the idea in case I was missing something.
I’ve only advertised one newer home that we moved in ourselves and while I’m not sure about everyone who called, I’m guessing that many were resellers. Almost every conversation began with, “What’s your bottom line cash price?” I’d then ask if they intended to keep it in the park and every person said they would move it out. I was fortunate in that they were all honest, but if someone had convinced me they wanted to live in the park, I may have been tempted to make a deal, just to be rid of it. There are scores of ads locally from people advertising they buy mobile homes. I think many take advantage of people who are financially strained and behind on lot rent (parks 20 miles from us charge $400/mo rent). I’m guessing that was the motive behind many of the calls. I only spoke with one person at length; he told me he was a reseller and promised to send a list of his current inventory, but I never heard from him again.
I happened to be on Craigslist at the right time and was able to buy this 2002 2/2 16 x 60 for $3500 that was in a high-rent park. We have another $5500 in move, setup, new skirting/deck/steps, and some minor repairs inside. Since we don’t want to own homes, we intended to sell them for our cost, so I listed it for $9000. I would have been satisfied with $9k if it stayed in the park, but I can’t replace it for that. And I’m not sure that I’d have any buyers at a full replacement cost (including setup). Most decent singlewides are closer to $10k in purchase price + move/setup. Since the park is in such a transition now, we’re not able to attract the type of buyers who could afford a $15k home, so we may have to entertain the rent credit idea, at least for a while.
I could see where the lease could present some problelms. Suppose the person intentionally gets evicted? I’d have to break the lease and it would be hard to demand they continue to pay rent. I’d like to see the contract the other parks use (in Jacksonville, FL) that require the buyer to continue making payments, even if they’re evicted. I may pose as a potential buyer and see how it’s worded. When I explained that I owned a park and was curious how they handled their agreement, the woman told me to go pay a lawyer. 
Thanks again for the input.
there is no way to keep somebody from moving or removing their property (mobile home)… I own 5 parks and have been at it for 26 years, usually a cash buyer is the guy who is going to move the home, and it is a lot of work buying and setting up… I ask the potential ad responder before I let the caller know I own the park, “Are you going to move it or leave it in the park?” Usually they will answer truthfully. At that point I just bump the price to where if they want to pay it they can take it. When I do get a guy who just wants a place to live, I do my do diligence on the guy, credit, criminal, call the local court, talk to the local baliff to see if they know him. After this if I get a good feeling and I think the guy will work in my community, I see how much cash he has to put down and you always want to get as much as you possibly can. I will sell them the house on an interest free loan and I will try to make the monthly house payment and lot rent within reason something that they can comfortably afford. It will be a lease with an option to purchase and when they reach the plateau of having it paid off, we will transfer the title. I also guarantee their monthly payment not to go up through the life of the agreement. I will guarantee the furnace for the first couple months of the heating season. I will pretty much guarantee the water system throughout the life of the loan, something like if they get a water leak, I will pay for the parts and the labor if it is a cheap fix. If it is an expensive fix, they pay for the parts and I will supply the labor for free. A water leak will do serious damage to a mobile home. This makes it a great deal for the resident, they have the mindset of a home owner and instead of $260 or $270 lot rent, I collect $475 to maybe $550/$600. I hope this helps.
