I’m very new to MHC’s and heavily researching them now. So I cold called a couple of local parks within a few miles of my home. I know the owners but not personally.
Both where more than happy to chat.
The first park was a small 8 lot MHC with all POH homes. Has permitting for 7 more lots but no services to set them up. Private communal well with septic tanks and a central dumpster and all dirt lots with dirt roads. Clean park and you can tell it is well cared for but I think it is mainly because the owner micro manages his tenants personally without the use of a park manager as he lives right next door.
Owner claims they almost always run at 100% occupancy with a waiting list and since I’ve known the community through the years I think he is not fudging that. $400 to $450 rent with trailers built in the 80’s and 90’s. Says he never has a problem with finding tenants when they are empty and the biggest problem is weeding through the applications to sort out the hoodlums.
Claims $42,000 revenue with $37,000 net.
He flatly states that lot rent will not work since banks simply will not finance any homes on a lot. They all want the land as collateral too. He did mention he could carry the notes for the homes but stated there where serious problems when people did not pay the lot rent and it was a huge hassle and liability to get their trailers off the property upon eviction for non-payment. Says he has only ever had to evict one tenant in his rentals and it only cost him two months rent and $200 in court cost.
He is getting older and wants to retire from the MHC business. He owned 4 MHC’s but sold the other 3 and now is looking for a buyer for this one but it’s tough since it’s so small. He had a home/park deal listed a few years ago but wanted too much in my opinion. His main complaint is not being able to get away from his community for travel as it inevitably requires his attention on a regular basis.
He is asking $245,000 for the MHC as it sits. I assured him I was only doing research and not to get his hopes up but I am going out to visit him some next week and he will show me the in and outs of his park. He seems almost eager!