Well I’m up against my deadline for due diligence, due to illness with the manager I was finally able to due the interior inspections of occupied units.
INFO: Park has 69 POH. I am basically paying nothing for them. I have the park under contract for lot only value.
QUESTION: Homes were in worse condition than expected. I went around with a mobile home contractor during the inspection. I estimate that each home will require an average of $2500 per home.
Assuming that after the $2500 per home rehab, I can sell each home for at least $5,000 (probably $6,000) on a rent credit program with 75% of rent going towards purchase price.
Is it fair to say that I can at least break even on the homes if I can sell them for at least $5,000 with $2500 total invested in the home?
I know I’m not going to make the $2500 per home spread, especially after Franks 50% turnover rule of thumb, but I need to at least break even.