Hello everyone I am new to the sight but not new to mobile home Parks. I have four already but I’m hopping on here to discuss my latest park I am trying to buy. I am locate in north central Kentucky. I am looking at a park right now in Elizabethtown ky. Which Elizabethtown the county population is a 120k and Elizabethtown is expected to grow in the next 2 years by 22,000 based on the projection rate. Also it has a 2 billion dollar battery facotry by ford going in. The park that I am looking at in Elizabethtown the owner is asking 1.5 million for it. It’s 32 lots, 15 park owned homes and the rest tenant owned, right now with rent rates the way they are it brings in $18,050 a month, bringing rents up to where they need to be it will be $21,950 a month. Also to add this is a class A park it is in great shape and headace free, Also everything is a 100% full no vacancies at all. I know what I’m thinking but would like opinions of others what they think.
What’s lot rent currently? Home rent? Estimated cash sale value of the POHs? And finally, what’s the utility situation?
Given what you wrote and making my own assumptions, looks like a good candidate.
Assume $18,400 a month in just lot rent.
FYI, I add ZERO value for POH rental income. If the $18,400/month includes POH income, then I would subtract that from the equation.
https://www.dropbox.com/scl/fo/677xo8kcspilk6igg9jy9/AC2SoXDkRcddXfSNr36IM9M?rlkey=oehjtpwcox0hb1n89uoax94uy&dl=0
File Name:
Simple MH Valuation with multiple exp and cap rates Joe P0001
| Paying Units | Rent | Monthly | Expense % | Expense $$ | Monthly NOI | Annual NOI | |
|---|---|---|---|---|---|---|---|
| 32 | $575.00 | $18,400.00 | 35% | $6,440.00 | $11,960.00 | $143,520.00 | |
| 32 | $575.00 | $18,400.00 | 45% | $8,280.00 | $10,120.00 | $121,440.00 | |
| 32 | $575.00 | $18,400.00 | 55% | $10,120.00 | $8,280.00 | $99,360.00 | |
| NOI | CAP | Value | |||||
| $143,520.00 | 7% | $2,050,285.71 | $2,050,285.71 | ||||
| $143,520.00 | 8% | $1,794,000.00 | |||||
| $143,520.00 | 9% | $1,594,666.67 | |||||
| NOI | CAP | Value | |||||
| $121,440.00 | 7% | $1,734,857.14 | |||||
| $121,440.00 | 8% | $1,518,000.00 | |||||
| $121,440.00 | 9% | $1,349,333.33 | |||||
| NOI | CAP | Value | |||||
| $99,360.00 | 7% | $1,419,428.57 | |||||
| $99,360.00 | 8% | $1,242,000.00 | |||||
| $99,360.00 | 9% | $1,104,000.00 | $1,104,000.00 |
Yah I’ve broke it down all that way I’m just getting some opinions from others.
This would be the most expensive park per pad I have bought.
What is the lot rent here?
It may be but you are buying the cash value of the POH homes also. Owner is not going to give you those homes for free so you have to evaluate as such. Get a pad space only price then add in the cash value of the homes for a price or get a price off current NOI and work backwards to make sure your not overpaying for the cash value of the homes.