Have you come across MHP brokers who also own several parks, even a small portfolio or more, which were purchased at attractive prices? This seems like a conflict of interest for both park owner looking to sell and prospective buyer. I’m curious what the group thinks. I have come across one broker that has purchased several parks for either what appear to be incredible prices, or just really high quality assets at prices for less than they would trade if widely marketed. The broker then lists other parks it sells regularly.
Yes, a lot of the brokers I know own multiple parks or have a portfolio.
In a way, I like it, because it shows they also invest in the asset they are selling you. Shows confidence. You’d be surprised how some people will sell you things they themselves would NEVER buy.
What you have to realize is that brokers will market, find deals and then package them to you at a premium. It’s their business. If you do not like that, the only solution is for you to create the deals themselves but that takes time.
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Check your local state regulations for this but yes if brokers are buying properties under market value and defrauding the owners, it is illegal. Many factors involved, check your local state regs.
There’s nothing wrong with brokers buying deals and it usually doesn’t create a conflict of interest for you (the buyer) or sellers. The only time it would create an issue was if a broker brought a deal to market, but also wanted to purchase the park for their own portfolio, and bid against the other buyers they were bringing the seller. In this instance, they would be conflicted.
If a broker owns a portfolio and buys large deals at prices that you feel are under market, there technically isn’t anything wrong with that. If there is a willing seller, and a willing buyer, and the broker was never supposed to market the deal, there is nothing wrong with that. Alternatively, a broker could say to a seller, I’ll buy this from you at $x now, or, if I bring it to market for you, I could probably achieve $x+$10. Not everyone wants $x+$10 - some people just want a quick transaction. This creates a willing seller and willing buyer. The broker is doing and getting what everyone here wants - off market deals at great prices.
Anecdotally, I know some large brokers in other asset classes that come out and say that they “don’t buy real estate as they don’t want to compete with their clients.” Personally, I don’t have an issue with a broker buying a deal. They are allowed to have multiple sources of income, just like you and I can. They happen to know owners of mobile home parks well, it makes sense to purchase parks for other sources of income, additional businesses, etc. Especially because it helps smooth out the variability in brokerage income.
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A broker misrepresenting value of a property for their own personal gain is a conflict of interest. Now did that happen in the OP’s situation is unknown.
With properties being harder to find, the value of a good broker has increased. It is good business to be a good partner with a broker - use their time efficiently, let them know what you are looking for and what you aren’t, close without undue delays, and make sure the broker gets paid. That will likely bring you the favored deals in the future. Brokers certainly aren’t bringing the best deals to the most difficult buyers.