Evaluating MHP Area

Hi All,

I’ve got my eye on 2-3 smaller parks (15-25 units) and wondering how you evaluate the local economy. What metrics do you look for?

I understand that unemployment is a major one and understanding what industry employees the workforce in your target area bur what are the metrics used during your “litmus test” of an area prior to going to work on getting it under contract?

I already plan on doing the CraigsList test as well and see how that goes.

This is my first venture into the MHP industry and am very motivated and enthused about the opportunities.

Thank you everyone for your time and advice. It is very much appreciated.

You simply must get Frank & Dave’s books off this website, and attend their next Bootcamp.

That said:

  1. Buy in metro areas of 100,000 people or more

  2. That have unemployment of 7% or less

  3. That have average home prices of $100,000 or more

  4. That have less than 30% of the housing stock for rent

You can get all this information off BestPlaces.net.

You should run that CraigsList ad AND place an ad in whatever is the largest newspaper in the metro. Now is the slow season, so you may want to hold off until the first or second week of January when ‘everyone’ has their tax refund and is looking for housing. You should get 3+ calls/day; if you do not, then it is probably not a good property to buy.

Small parks in middle-of-nowhere towns of s bootcamp in Los Angeles.


P.S. I receive no compensation from anything sold on this site. Unfortunately!

Thank you Jefferson for the quick run down - it is greatly appreciated.

Frank & Dave’s material is next on my list to buy for continuing my education.

Follow-up RE: Unemployment rate under 7% - with the National average coming in around 8.6% (last time I checked) - doesn’t that severely narrow the areas to purchase in?

The unemployment rate in any area is not one of the key indicators of how strong a market it is for affordable housing. However, it is a good barometer of the overall health of the city or town. Anything under 10% is fine, and over 10% will require really becoming an expert in why that is occurring. In many of the Great Plains states – such as Nebraska – you will find unemployment rates under 5% with great regularity. But this is not one of the key drivers to success with a park, so while it’s a good stat to know, it’s only one of about 100 that would be a part of your due diligence. The response to your test ad, the breakdown of top 10 employers, the rise or decline in population – those are way more important.

Thank you Frank for your response and for a great program and community you guys put together. Look forward to becoming a member soon as I have a goal to buy my first MHP in 2014.

Yes. And that’s exactly the point.

Ultimately in my book, there are no bad deals, there are just bad prices to pay. That said, I’d rather focus on higher-quality parks in better economies with fewer POHs.

If a deal checked out on every other key dimension other than unemployment, it’d still probably be a good deal (e.g. if the HHI was $50k+, and AHP was $150k+, and the metro was 100,000+, etc.). But as you’ll find, high unemployment tends to go hand-in-hand with lower housing prices, and shrinking populations (e.g. shrinking housing demand), and 40%+ of the housing being for rent, etc. These things have a compounding effect. You can survive if one of these metrics is, say, 20% below your threshold, but if 3 of the metrics are all 20% below your threshold, the overall deal is 100% below what it needs to be.

My most recent acquisition was in an area with a metro of 1mm+, U: 5.5%, AHP: $150k, HHI: $58k, rental stock: 16%. Every metric was in my favor. Needless to say, it’s a good deal. (Plus I secured 100% bank financing… :)-D)

To your continued education,


Jefferson, what is HHI?

I deciphered AHP as “Avg Home Price” but couldn’t correlate HHI to anything mentioned in the above posts.

Thank you for the great tip on BestPlaces.net - it’s an amazing data resource. I was looking for Rental Stock but didn’t see that metric on there - is there another way you figure that one out? I was thinking about call both the CA MHA & CA Realtors Association.

Thank you!

HHI = Household Income. It is on BestPlaces.net under ‘Economy’ and is listed as ‘Household Income.’

Rental Stock is also on BestPlaces.net under ‘Housing’ and is listed as ‘Homes Rented.’

To your continued education,


Can’t believe I missed that - thank you sir!

When look at population, do you take a hardline at city population or do you expand to Metro? Can in-point would be the city has 13,000 and Metro Area has 166,000. The major city in this metro - that hold most of this population - is within 10-20 min of this park.

Appreciate the responses as an overview perspective. I will be buying the due diligence to get into the nitty gritty.

At 20 miles away, you are definitely in the metro of 166,000. You need to use a test ad to make sure you are in a desirable part of that metro – one that people seek out to live in.