I am looking at buying a park that has lot rents of $200.00, which is in line with the other parks in the area. The Rentometer for a 2 bedroom is $800. It looks like rents have not been raised in a number of years. Additionally, there are parks in the area that will pay the moving and setup costs for anyone who will move into their park. If I buy this park, I want to raise rents $20-$35 day one, and then a 10% raise each year thereafter. Is this strategy too aggressive?
Your plan sounds reasonable. In strong markets your lot rent can generally go to 1/2 the average rent for a 2BR apartment. In weaker markets it’s 1/3 (generally where a lot of land/home is). You are presently at 1/4, which is low.
To your continued success,
-jl-