You might be able to hit $12,000 on a few homes, but the reality is that to hit $12,000 you’ll have to buy a home for $7,000 that is immaculate and then spend $5,000 to move it, set it, skirt it, hook it up and put stairs and an A/C on it. Many homes that you can buy for $7,000 are going to need around $5,000 of renovations before you can sell them. That would take you to $17,000. And it’s hard to find a decent repo for $7,000. That’s why I was using $25,000 as an average.
If you have $60,000 in cash, you’ll want to hold back at least $20,000 for a rainy day, which gives you a budget of $40,000. You’ll want to find a mom & pop deal with 20% down and seller financing, more than likely. That gives you a park price range of $200,000. And you’ll try to find a turnaround for around $10,000 per lot, so that’s a 20 space park.
The deal you have is right on the mark except for 1) it has too much vacancy (imagine the same deal at 80% occupancy and 2) the seller’s note is too short at 2 years.
How could you make your existing deal work? 1) Get him to go from 2 years to 10 (get at least 7 if you can) and 2) Convince him to carry 100% if you agree to bring in 2 homes with our $30,000 and make those collateral on the loan. That way you’re only 6 homes shy of where you need to be. Then be the world’s greatest home shopper and buy two more homes with your next $20,000 (you’ll have to be one heck of a home buyer). Now you’re only 4 shy. Go out and find a Lonnie dealer who will bring those final four homes, or raid another park and get 4 people to move if you pay for their moving cost, or see if you can bring in 4 RVs under your city permit.
Don’t give up on your existing deal yet – try to renegotiate from a dog deal to a great deal.