We now have our head above water and are looking at filling a vacant lot in our park. I’ve seen some ads for legacy homes on this website along with financing that they offer on the mobile homes. The homes look nice on the inside. I’m kicking around the idea of getting one in our park with only 30% down. However, they don’t have a dealer in NE where my park is located.
The lot rent on the park is $230/ mo. The space will only accommodate a 12x54ft home. The lot is in a medium visibility location located second from front.
Is there a formula that would help me make a decision about how much I should spend on bringing a home into the park? Would it just be better to buy a $10,000 home? Does anyone else have experience with the terms of financing with legacy homes?
There is only one reason do do business with Legacy, and that is their financing. Their homes, while nice, are not materially different than anyone else’s, nor is their pricing any different. Because Legacy are the only ones offering financing, they are hugely successful and their factory is very backed up.
I ordered two homes from Legacy March 12th, was told they’d be ready in two and a half weeks, but my homes only got delivered to me two weeks ago (after 12 weeks - although one week of the delay was my bank’s delay on final payment), and the homes are still not fully set because Legacy’s set crew had to go do another job. The final home will be set today, hopefully. So you’ll wait about 14 weeks before your Legacy home will be in your park and actually set and ready for utility connections, skirting, etc.
In contrast, you could probably have a used home, or a new home from any other vendor, set in your park in 2 - 3 weeks. So you need to decide what the value is to you of having financing vs. the 3+ month delay of not having any revenue coming in.
As regards a ratio of home price to lot rent, many owners won’t spend more than about 100x the lot rent to bring in a home. So if your lot rents are $230, then that would mean your budget should be around $23,000. That said, I spent nearly 200x my lot rent bringing in the Legacy homes. While there is nothing wrong with having brand new homes in one’s community, I view these as a bit of an experiment. Any new home will bring in more money. It’s too early to tell if new homes will attract a materially better tenant. I’ll update this post once I get some experience under my belt with these new homes and see what tenants they attract. If it’s the ‘same old tenant’ and just a bit more money, I’ll go back to buying used for $20,000 - $25,000 and not buy new at $40,000.
I have been tempted many times to buy new but just have not had the nerve to pull the trigger and spend that much money. We can still find used Greentree, Vanderbilt and FSBO homes, although it is more work and sometimes the repairs end up way more than we planned for, but in the long run still the best use of your funds, in my opinion.