Over the last 40 years whenever I would have a vacancy in my mobile home park I would do a market survey of the other parks in town and come up with market rent for the new tenant. I consider an existing tenant selling his home to a new tenant as a change of ownership, and at that time I always raise the rent to market. The same when someone wanted to add people to their agreement.
I got snookered. Everyone was complaining so much about inflation in 2024 and early 2025 even the property management. Consensus:. I shouldnât raise the rent very much. after doing my usual research I saw that I could raise the rent about $40 per space and just about to keep up with all the other mobile home parks in town that I consider market rent.
However, to be a nice guy I only raised the rent $20. So now then someone wants to sell the home and I say OK I want you to raise the rent to market value $40 higher and the property manager and the attorney say, â Oh no, you can only charge the market rent in your park.
Keep in mind when I raise the rent $20. I did not know that I was establishing market rent for my PARK. So this new tenant eight months later can still get market rent at the $20
Moral to the story is that if there are no caps on how much I can raise the rent in 2026. I guarantee you I will be raising my rent to citywide market rents.
The property manager is in alignment with the attorney and wonât do what I want. Hereâs what the attorney said, and Colorado.:
You asked that I advise as to why I think you need to be consistent in your mobile home lot rents. Pursuant to Colorado Revised Statute 38-12-210(4), a mobile home park is required to treat it all persons equally in renting or leasing available space. As an example, if the standard rent for a single wide space is $100.00 then I donât think you can say to applicant A that it is $100 and to applicant B that it is $150. Since you just sent out notices to everyone in the park that the lot rent is now $X, then I think you are required to rent the space in question for that amount. In addition to the statute, Colorado is starting to treat park rentals as fair housing issues. If you rent lots for a set price to one person and then try to say it is more for someone else, you run a serious risk of being found to be discriminatory towards one or the other.
I think your attorney is giving you a good clue here with Colorado starting to MHPs in the lens of âfair housingâ. Your property management company is trying to ensure you donât get jammed up in a discrimination lawsuit by charging varying rents after a market rate rent adjustment 8 months ago. Now would it ever happen? Well probably not but your team is doing their best to stay on the right side of the fence.
In our parks we try to keep everyoneâs leases whether month to month or yearly we try to keep them on the same cycle. Then as lease renewal date approaches we give 90 days notice along with a market analysis to substantiate our new rate. If you want to be market high on rent be market high; if you want to be market low, be market low. Once you set the number you set the number and it is set for a year or until you do another market analysis. Just a thought.
Except for certain obvious circumstances (larger lot, double wide, etc) we try to keep all our lot rents equal in each park. We keep raises equal on a % basis annually as well. It just keeps it cleaner.
Also, since you are only allowed to increase rents once per 12 months, you can argue that all new people from X date forward are paying more because they will not get a rent increase for +12 months. IE, you only raise the rent on January 1st. Anyone moving in after January 1st, 2025, will not get a rent increase until January 1st, 2027.
What you could do is have two different rent increase dates. IE January 1st and June 1st. I do that at one of my parks, and itâs a pain, but it illuminates having to track multiple anniversary dates. IE 2 people in January, 10 in February, etc.
I have found the easiest is to have one anniversary date for the whole park.
The statute says you must âtreat all persons equally in renting or leasingâ. It does not tell you must âCharge all persons equally.â
I agree with SD Guy. If you have a bunch of people paying $100, they are locked into a lease for the rest of their terms, which varies for everyone. Now, let it be know that effective today and onwards for EVERYONE, that rent is now $150. You charge the new people $150. The others will be on notice that their rent will also be $150, but not until their existing lease expires. One by one, as their terms expire, they start paying $150.
If you rationalize what your attorney says, it is flawed logic. For example, if everyone is at $100 and they are locked into a lease, you are stuck with them at $100 for now. If they say the new tenant must be at the same rent, then he must be at $100 too. Now the original tenants go to $150 but the newer guy is still locked in at $100 so it would not be fair to raise rents. Obviously this is a chicken & egg scenario and is unrealistic.
If you attorney does not understand this, get a new attorney.
Disagree; you are now moving rents up due to time moving on. As long as you are treating all the same and TIME PERIOD is included. You can move up rents to new tenants. If all new tenants (that is their cateogory, NEW tenants, you are by definition, treating the same) Donât ever, ever let an attorney run a business. Youâll lose money every time.