Lot only mobile home park analysis

I’m looking at mobile home park in rural Ohio at $338,000 and interested any opinions/comments.

Asking Price: $338,000
Town Pop: 16,297​
Year Built: 1950
Num of Lots: 36
Total Occupancy: 32
Avg MH Lot Rent: $150
Num of POH: 0
Water: City
Sewer: City
Water Paid by: Tenant
Trash Paid by: Park Provided
Year Built: 1950
Size: 3.0 arces

The mobile home park is in a small town and all of the mobile homes are tenant owned are pretty old (1960’s or so). The tenants are all long term residents. The trash comes out to be around $3500 a year. Taxes come out to be about $2600 a year. There’s no amenities at the park though there is a laundromat next door. There’s 3 abandon trailers in the park.

The numbers you gave look OK so far. If expenses are around 40% it caps around 10%. Not bad if you are in it for the income. I don’t see a lot of upside if rents are at market. Of course you need to look at the local economy and demand and condition of the park and plug that into your consideration whether to buy or not.

Can the abandoned homes be fixed up and sold?

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I would want to know what the metropolitan population is. Also what is the median cost for a home and what is the housing vacancy rate for the area? These are pretty important indicators of the market.

The metro area has ~650k population with -0.9% decline. The city itself has 16k with -7% decline. The median home price is $76,225. 4% unemployment rate. Still researching housing vacancy rate.

Also, I’d look at lot sizes. If the homes are all that old, it might be due to the fact the lots are too small for new homes. And unless you are in a very good market, that could be a problem.

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I put an ad on the local craigslist. All people that responded were looking for mobile homes to rent, not just the lot. I received about 3-4 emails (looking for mobile homes) since I posted on Monday. The lots are smaller than normal. The lot sizes are: 80’x30’ - 65’x40’ - 73’x40’.

Median home price of 76k is a big red flag. You will be competing with affordable homes. Your lot rent would have to be so low it probably wouldn’t be worth it. You can fix a lot of things but not a bad market. I think most people would probably pass on this but you never know.

I have come across some markets that were ( probably up in the last couple years) that were around 80k that seemed great.

One arbitrary metric i like is comparing the household income with house price. Example, if the avg house price is 80k and the average household income is 40k thats a ratio of 2:1. Ive only watched this metric on a handful of markets over the years but what I have seen is some of those markets converted to a 3:1 market, meaning housing prices have increased to closer to 120k ( other market metrics were healthy jobs , unemployment etc).

I remember hearing that housing cost is about 3x as a historical norm (some markets are out of whack probably forever but this has been something I have watched as kind of a potential "upside " on some undervalued markets.

This is more of a back pocket analysis for me but thought id share on this topic.

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Did you end up purchasing this park?

Any insight on what happened the first go around? The park is back on the market. It appears that the same units are still vacant.