Since I seem to be addicted to running numbers and scenarios of potential deals I thought I’d put this one out there to anyone on the forum. This is a deal I’ve been working on for a few months. The seller and I have developed good repore and he will carry financing. The park is actually in very good condition with large lots, chain link fence surrounding each lot, paved roads, nice trees, and on a main road. The seller wants to move back to his home town to care for his ill parents. Here’s the scoop:
42 lots
lot rent = 165
21 lot rent only
13 POH’s, avg rent is 425
8 lots unoccupied, but have homes on them
city utilities
The seller and his wife are running the park themselves, doing all the repairs, collecting rent, etc. The lot rent is a little under market, I could easily raise it 20 dollars. He has begun installing water meters, but is still paying for the water - ~ 1200/month. So the upside exists in possibly submetering, raising rent, and filling the existing vacant homes and converting the rentals to sell on terms. He does a good job of fixing the homes and from the pictures I’ve seen they are in good condition.
He has thrown out an asking price of 675,000, which is far above what I’ll pay. I’ve run my numbers and have a pretty solid idea of a max price I’d pay, but wanted to see what others might come up with.
Any suggestions on how best to negotiate from this point would be appreciated.
Thanks everyone…
Robbie