- Less than 30%
- Higher than 60%
Curious to see how this adjusts by region as well. I’ll add in PA, which are the parks I chase, (less than 75 lots), I generally see 40-50% expense ratios. Maybe higher if the park is not stabilized and on private utilities.
Thanks for posting this poll and survey! One major consideration to weigh, which will undoubtedly skew your findings, is whether or not MHP is made-up of TOHs or POHs (or a mix). Will vastly influence exp ratio
@JCas06 …love your pole idea, but it is too subjective as @DaveR alluded to. You have stabilized city sewer/water (typically 30%), water/septic (35%), well/septic (35-40%), waste treatment plant and/or city/well water (40-45%), POH and any of those other factors (50%+). Value-add changes all these variables. If you have a specific property type in mind, consider running a pole for that specific property type if you are trying to get a baseline.
The way I normalize expense ratios across properties use lot rent only (no utility reimbursements, home rents, home property tax reimbursements, etc) and I exclude any utility, tax or other reimbursable expenses from the expense number. I run POH income and expenses on a separate P&L. I try to exclude major one-time capital expenses (e.g. vacant pad development, etc) so my expenses are closer to regular ongoing operating expenses. This gives me a better idea of what it takes to run the park and allows me to benchmark properties. I target 30% and usually achieve that, lower on parks I’ve owned for more than a year or two. Parks with septic systems, private water, will run higher as PFM mentioned.