Does the fact that a sex offender is a tenant in the park kill this deal? Is this a massive liability on the park owner or myself if I were to buy this property?
Came across a MHP for sale with the following stats
Asking $350,000 for 33 units
25 units are tenant owned
4 are POH
Cap rate says 14.2%
Gross Rents = $63,600
Operating Exp = $14000
NOI = $49,600
I understand there a lot of unknowns but all this information i gleaned from quick searching on google and the listing itself.
I am new to the biz and have yet to purchase my first MHP.
You never know what you are going to get when you buy a park. We have several felons (so we hear, I have no proof) in our park that lived there when we bought it. Since he is an existing tenant, look more at the history. I’m not going to defend him, but there are people that just do something stupid and get in a bad situation but are not dangerous. If the rest of the park is a good deal, this shouldn’t break it. Now if you know he is a problem tenant for any reason, then you can evict him when you take over or have the seller start the process. My guess is there is at least one other person in the park with a felony you don’t know about.
If you still have concerns, move on to the next deal. There are plenty to look at.
And if you haven’t at least bought the due diligence package from Frank and Dave, start there. It covers many topics that come up in this forum.