Vacant Land with MHP

Hi everyone, a bit of a basic question here but how do you you value vacant land? By vacant land, i don’t mean land that has been zoned or received permits for additional lots, rather just that, land. I have seen a few properties that are selling mobile home parks with additional acreage (5-10 acres) but from what I can tell, it’s just empty land. I understand how to value the park, just the additional land is a bit confusing.

Thank you. Appreciate your guidance!

Additional land is non-income producing - worth zero dollars. You’re going to pay taxes on that land. Keep that in mind. Unless you’re developing the land into more pads (assuming it’s allowed).

You can find the raw value of land in that area and consider parceling it off to sell it - could be one way to value it. This is assuming there’s demand for it - speak to some RE agents/brokers.

Don’t fall for the myth of what park owners will tell you that the park is worth more because of all the vacant land- you’re going to pay taxes on it and need to maintain it.

1 Like

Thank you! Yes, I have a seller who is adamant that the land has some intrinsic value, and while it is in a metro, it isn’t as if there is massive development going on in the area. Unfortunately, they are using that additional acreage to justify their significant price hike. I’ll try to see if they can consider parcel it off, I don’t care for the additional land.

Thanks for the insight!

It’s a negotiating strategy I’ve used successfully once before “ok I’ll pay $x for the park and you can parcel off and keep the raw land”

1 Like

All things being equal, given the tax implications, if the option exists, would it be preferable to parcel off that land given it has no immediate value? Superficially, taking on in additional 5-10 plus acres doesn’t seem ideal as you guys mentioned but I haven’t considered, or maybe unaware, of the various benefits of retaining the land.

The only value in simply retaining the land is for development or expansion of the park. This is assuming you are permitted to do so by local government. This is also assuming you have the money to do it - very expensive.

Or if you’re lucky Home Depot wants to buy your land and your park- a long shot.

Otherwise I wouldn’t place any extra value on the vacant land.

I’ve dumped a lot of deals because the seller wants an extra million for land I don’t want.

Don’t do the deal and overpay- the vacant land won’t cover your expenses/debt.

1 Like