I’m new to this forum, but am extremely grateful to Frank & others for their valuable insight…I’m looking to buy my first Mobile Home Park in Northeastern Ohio (where I currently live).
There’s a park available near Mansfield, Ohio. Has 23 pads, 13 are currently occupied (all TOH). Utilities are billed directly to tenants. Net Operating Income is roughly $24k. Lot Rent is around $225 per lot. Seller wants $350k…roughly a 7% Cap Rate…Not sure what market rent is in the area, but I would likely increase rent to $250. Not located in an area where homes are expensive to purchase.
As this is my first potential deal, what is the going rate for Cap Rates for a park of this size? What would you offer based upon these stats? Anything else to look out for? Owner is selling due to poor health / retirement.
Thank you in advance for your help.