Is it better to buy an existing park or to develop your own? I’m sure this question depends on a lot of things, but is one neccessarily always cheaper then the other?
If you do decided to develop a park from scratch, I hope you will consider doing a blog. I’m sure many of us would want to read it.
I, too, would be interested in knowing the steps involved in developing a park. Buying the land and creating pads. I don’t think I would like to own homes at this point. I’m a beginner and would like the least amount of headaches. Less risk, less rewards I know, but that’ll come later I suppose.
You are right there are a lot of vairables in deciding whether to develop or buy an exsisting park. It would really depend on each individuals financial situation. There is a lot of red tape you have to go thru to be a developer. In my county you have to have a plat drawn up, the same as a subdivision and it has to be approved by the county for development with all the lots, septics, or sewer lines etc. shown.
First you need to find property that is suitable for development and within a reasonable price range. You must determine that it has water available to the property. Sewer is great if it is available, however if it isn’t then you may have to go with private Septic Systems. I know most developers are afraid to take this route, but living in a rural area it was my only option at the time. You don’t get as many spaces, but you also don’t have tenants living so close together that they disturb one another either. You can ask higher rentals I have found because of this too.
I had to go through our counties health department who regulates septic system installment. Please do not be niave, if they tell you that you need reserve lines, don’t argue… 20 years from now you may be glad you have them. I have space reserved for my reserve lines. I have never had to install them to date, but I know they are there if I need them. You can also install systems depending on how the land perks that can carry up to three 3 bedroom homes.
You will have to install your water lines to the required setback that what ever governing body requires. You may have to install roads. We did, but our county allows us two years to finish the road work. Again, check with your governing bodies in your county and state.
I know some of you have to install pads to sat the homes on. We do not, so that saved me a lot of money. We were allowed to grade the spots and sat the homes on cinder block peirs. So I want be of much help there.
I currently have my park for sale. People ask me what I am going to do when I sell it… What else??? I will always be in the mobile home/real estate business. Yes it has it’s headaches, but it has been good to me. Hope this helps.
I have been flopping the idea around about developing a park in a rural area. in fact it is now under cultivation but the crops are harvisted for the year so instead of leasing again next year I want to bring in some moble homes on it.
I was planning to start some of the foot work tomorrow by reading your post I can see that I have a lot of questions to ask. I assume that I have to start at the assessor’s office. The property is already ours, free and clear. We just want to make it work for us. This year it only earned about 100 dollars per acre. I think it can do better.
Dear TE MICK,
You will need to find out what governing body regulates development in your area. In my county we have a mobile home park ordinance that governs the development of mobile home parks, which is overseen by the Counties Planning Commission, Building Inspectors Office and the County’s Health Department. We have to meet those codes the same way a developer of a subdivision would.
For some people, developing a park is not for them. They want to buy parks already established. I understnad that, but hey, Somebody had to develop all of these mobile home parks. I consider myself a pioneer of the industry of MHP development in my County.
If you have planning commissions, building inspectors, and health department regulations you have to meet, I warn you it can be frustrating, especially if you have never done it before. If you have a lot of patience, (you will need it I can promise you that,) then just like any kind of work the rewards will be worth it in the end. I’ve never been afraid of hard work. I enjoy developing something from raw land. I get excited about it…
My park has made me a good living for the last 17 years. If you have the land, then why not? You are going to be adding value to it plus it will produce you a good income in the end. As a fellow farmer, we know about making the land produce for us, now don’t we? This is just another way of doing it.
I will be glad to help answer any questions you may have. Feel free to email me anytime, email@example.com.
Stay in touch and take pictures…
For me it would all depend on ones financial situation. By the time you factor in the cost of curbs, streets, sewer, water, etc. you may find it’s much cheaper to buy something existing. Another point from the development side would be that it would be cashflow negative until you fill the park, which could be years. The amount of cash flow needed to carry it until it got to that point would be tremendous.
The flip side would be that all your infrastructure would be new and you would earn higher rents with a new park and all new homes.
As I stated in my first reply, it does depend on one’s own financial situation. It depends on the demand for rental spaces in your area, do you want to own the homes you are putting into your park? Do you want to lease the lots and not own the homes? How long will it take to fill those spots? As in my first reply, there are a lot of variables for each individual.
I can’t say, nor would I imply that developing over buying is better, nor do I say buying over developing is better. Take it case by case, individual by individual situation. If there was a cookie cutter way to make money, we would all be rich…
However, if you decide to develop and you have done your homework, then there are advantages to each approach. YOU MUST DO YOUR HOMEWORK!
I would check with my local Mobile Home Dealers to see if they would be willing to direct people to your Mobile Home Park. This is always a good source of potiential lease/lot tenants. Drive by their businesses, see if they are moving the homes they claim they are. Some dealers may be willing to offer you a commission for letting them place customers in you park. This helps them to sell homes to people who do not have land to set their homes own.
Again, do your homework. Remember, there is work involved in everything you do, to some degree. Even if you buy an exsisting lease/lot park, don’t be naive, you are going to have some work, some issues to face, that is just life. Is there money to be made? There sure is…
There is one thing we can all agree on. It is an individual situation for each of us. Good Luck and Be Careful no matter which way is right for you.
I have purchased 18.5 acres and have started the development process from scratch.
I have two parcels, one is 3.62 acres and one is 14.4 acres. I plan to build a MHP on the 14.4 acres and a self-storage facility on the 3.62 acres.
My civil engineers have met with the County Planning department and so far they have given no reason why they wouldn’t approve a MHP.
I have to get a zone change on both parcels, one will be changed to MP and the other one to M-1.
The property is located in So. California and has freeway frontage and a freeway off-ramp right next to the property.
I am only about 500-600 ft from the sewer and water connection, so that should not be a problem. Electric runs parallel to the property along the main road.
I am also considering building a “Solar Farm” using the roof-tops of the self-storage facility for the solar panels. The area I am in has about 350 days of sunshine annually, so I can easily put up a 1 MegaWatt solar farm that will supply enough electricity for 600-650 homes.
The solar farm will not only supply all the power to the MHP and SS facility, but will be connected to the local electric grid and sell “green” power back to the grid.
I am currently working on the grading plan and site development with the engineering company.
I plan to get 100 - 125 spaces in the park along with a recreation room and pool area.
Rents in the area are running about $400 - $500 monthly.
I will consider putting together a BLOG for this project so I can share the information with everyone.
If anyone has any questions or comments, please feel free to contact me either by email or phone. (email me and I will send you my phone number)
Dave…What are the engineers charging you to develop the site plans? I have spoken with a few and they are quoting me around 25,000 for 85 units. I have no idea if this is reasonable.
I estimate that I can develop my 80 lot park for 8,000 a lot and get around 250 each month per lot. What happens if after a year I only have it 20% full and I want to get out of it. What can I expect to sell it for? What would be the difference in the sell price if it were 90% occupied compared to 20% occupied?
This sounds like a fasinating project. Please create a blog. I’m fasinated by the solar power approach. Living on the east coast I’ve not heard too much about it, but I have always been curious about solar power. Please create the blog so I can get educated in this area.