Are you ready to MINE for a good deal? Great. I'm excited about showing you how to do it.
Before we venture into the marketplace, we have to make some assumptions about the mobile home deal you are looking for. Let me give you an important statistic that will empower you. There are more than 8 million mobile homes in the U.S. Coupled with that, you can expect at least 10% to be for sale at any one time. Why are these facts so important? They are important because it means right now there are 800,000 mobile homes for sale, with anxious owners waiting for you. Is that enough?
With that many mobile homes for sale, you have to make some assumptions to narrow down your search. You only want to spend as much time as necessary to find the right home for you.
The first question to ask yourself is:
Do you want a new home or a used one?
In this series of articles we're going to narrow our search to used, or pre-owned homes. Why? After you scout around you are going to discover another important fact: there are plenty of used mobile homes that look almost as good as the day they were shipped from the factory, because the owners have taken care of them. There are also used mobile homes that have been abused and need lots of repairs. It's similar to buying a used car, in that some are "creampuffs," driven only on Sundays to church and back by Gramma and Grampa, and some are "clunkers," and have been run to Kingdom Come and back.
Consider another important fact: used mobile homes depreciate quickly in price, like cars. That's good for you, because you will be able to save thousands over buying a new mobile home. However, there is a major difference between used mobile homes and used cars: mobile homes can last as long as a site built home, if they are given normal care. I have seen mobile homes that are still comfortable, safe, and healthy places to live, and they are 50 years old. Mobile homes don't have gasoline engines, transmissions, and tires and get run around on bad roads for 200,000 miles. Cars require substantial care to last more than 20 years. Mobile homes don't.
The second reason we are going to stick to used mobile homes is because it is much much much easier to buy a used home. Notice the three "much's."
No doubt about it, you get a wonderful feeling when you buy something brand new. But to capture that feeling, you will have to spend lot more money, time, and work, up front. You have to select the home you want from 25 different manufacturers, decide on a delivery date, and go through a tedious loan process. Then you have to pick out a piece of land to place the home on, and make sure zoning allows you place a mobile home on it because there are usually restrictions on where you can place them. After you permit the land for your new mobile, you have to prepare the land, transport and move the new home onto it, and then hire licensed contractors to complete the set-up process.
With a used home, you write a contract, inspect the home, arrange a loan, and move in. Sounds a lot simpler, doesn't it?
Now, given we're only going to discuss used, or pre-owned, mobile homes, the first decision you will have to make is what your ownership is going to be on the land under your mobile home. You have two choices:
1- A mobile home park where you will lease your lot
2- Somewhere else where you will own your land
Each has its own advantages, and disadvantages. It is estimated that half of the mobile homes built each year are placed in mobile home parks, and the other half, on private land, so the market is now equally split on which advantages and disadvantages it prefers. There are over 50,000 mobile home parks in the United States, more than 1,000 for every state on average, so they are a popular alternative.
In a mobile home park where you lease the lot under the mobile home, it will cost you less to buy the home. In our area of Southwest Florida, you can buy excellent used mobile homes in mobile home parks on a leased lot for less than $10,000. In some cases, you can buy them for less than $5,000. How's that for affordable housing? It is a fraction of $100,000, which is the cost of a median priced site built single-family home in our area.
There are other advantages to park living. Many mobile home parks have amenities like swimming pools, clubhouses, playgrounds, health clubs, etc.. Your neighbors in the mobile home park will also have gone through a criminal and financial screening process, and there will be rules and regulations for acceptable behavior. Furthermore, there are parks that only allow residents that are over 55, and parks where any age families and their children are allowed.
What are the disadvantages of living in mobile home parks? You will have to pay lot rent on the land under your mobile home, which has a tendency to increase every year. The average lot rent in the United States is around $300 per month. I have seen it range from $100 per month in some Southern areas, to over $1,000 per month in California. Along with leasing your land, you should not expect to receive any substantial appreciation in value. Mobile homes depreciate in value over time. Land is what appreciates, and since you do not own the land, but lease it, you will miss out on that important benefit.
The bottom line is this - you can live in a mobile home for about the same monthly cost as renting an apartment, but now you own your home, with your own parking space, and your own yard. That home is also mobile and you can take it with you when you move, if you want.
What are the advantages of owning the land under the mobile home and living outside a mobile home park? Exactly the inverse of what you just learned about mobile home parks. You will have more freedom and privacy to do what you want on your own land, provided you conform to zoning and police ordinances. You will not have to pay lot rent that keeps increasing over time, and you can receive substantial appreciation in value on the land, at the very least, from paying down the mortgage on it.
What are the disadvantages of buying the land along with the mobile home? First and foremost, it will cost much more. In our area of Florida, you can expect to pay between $25,000 and $50,000 for a modest mobile home on a modest lot. That's 5 to 10 times more than just buying a home for $5,000 - $10,000 on a leased lot. You will also have less amenities, and little or no screening of your neighbors when you purchase outside a mobile home park.
As you can see, your relationship to the land under your mobile home is an important one, and you should consider the benefits and drawbacks carefully.
We have just two more factors to discuss, and then we are going to set out to find the right home for you. They are: singlewides vs doublewides, and moving your mobile home.
Singlewides are one self-contained unit, closed on all four sides. They vary from 10-12 feet wide, for the older models, to 14 or 16 feet wide for the newer ones, and from 40 feet to 80 feet in length. Doublewides, as the name suggests, are twice the width of singlewides. They are composed of two singlewides, each open on one side. The two singlewides are sandwiched together and attached on their open sides.
Doublewides can cost up to twice the price of singlewides, but even so, many people strongly prefer doublewides. Why? Because the floor plan of a doublewide matches a standard site built home. In many cases, if you were blindfolded and then placed inside a doublewide, when the blindfold was removed, you would not be able to tell the difference between the mobile home and a site built single family home. You will have to decide whether a singlewide or doublewide is best for you, based upon price, availability, and your lifestyle preference.
The third, and last choice you need to make, is how mobile you want the mobile home to be. In many states, it costs between $2,500 - $3,000 to detach a singlewide from where it currently sits, transport it to a new location, and then set it up again. When it comes to moving a doublewide, the same process costs twice and much, between $5,000 - $6,000 on average. If you are going to pay $3,000 - $6,000 to purchase a mobile home, it probably doesn't make sense to move it, because it will cost as much to move it as it is worth. It makes more sense to sell your current home, and then purchase a new one at your new destination. If you want to move your home with you as you change locations, then singlewides are the low cost alternative.
Speaking of being mobile, the mobile home industry is ambivalent, or feels two opposite emotions about that part of its heritage. A few decades back, manufactures got together and changed the name of a mobile home to a manufactured home, because it was built in a factory. Their public relations departments probably told them that mobile was not a warm and fuzzy concept in the public's mind when it came to their home - rather, they wanted their home to feel permanent and unchanging, not movable and changing. Sometimes, I come across a seller who gets upset when I refer to their home as a mobile home. They say, "I own a manufactured home, not a mobile home!"
SWell, there is no difference between a mobile home and a manufactured home, other than a preconceived notion in some people's minds. This author thinks the mobility of a home can have powerful advantages when it comes to the expense of moving, packing and unpacking boxes, and feeling comfortable in your new surroundings. We have friends who worked in the construction industry. They moved their mobile home many times when they changed job locations. It was faster, cheaper, and easier than when my family changed locations in our site built homes.
To summarize, it is easier to buy a pre-owned or used mobile home, than a new one, and you have 3 simple choices to make about your mobile home:
1- Lease the land vs own the land
2- Singlewide vs doublewide
3- How mobile you want the home to be
We are now going to continue on the M-O-B-I-L-E method, which is:
MINE for a good deal, figure your OFFER, write a contract to BUY and then negotiate, INSPECT it carefully, find a great LOAN, and ENJOY your home.
What about my teaser?
Would you like to learn how to get a mobile home for free?
Most of you will not need to buy a home for free. However, many of you will need the price, the down payments, closing costs, and repairs to be as low as possible up front. I will show you how to do that, so you will be satisfied and comfortable with your purchase of a mobile home. It will be a good deal.
If you are among the minority, where the only way you can own a home is if someone gives it to you for free, I will fulfill on that pledge.
Either way, read on, fair reader, read on.
Please get out your yellow pages now, your local newspaper, and turn on your computer and get the Internet up and running.
In the next article, we're going to go out and get a good deal!
© Copyright 2010 by Zalman Velvel
Stu Silver is a real
estate investor, writer, speaker and trainer who deals with the lucrative, but
often overlooked, subject of Mobil Home and Mobile Home Park investment.
Mr. Silver and his family have real estate holdings that include 500 rental
units, comprised of 11 mobile home parks, warehouses, mini-warehouses, offices,
single family homes, duplexes, and motels. Under the pen-name of Zalman
Velvel, he has written two well-received books: Mobile
Home Wealth and Mobile
Home Wealth Part 2: Mobile Home Parks.
Mr. Silver has
been a full time investor for more than 28 years. He holds the coveted
CCIM designation, and is licensed as a real estate broker, mortgage broker,
auctioneer, mobile home
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Mobile Homes: How to Get a Good Deal. Where to MINE for Deals: The Marketplace
|SIX HUNDRED Pages covering
every step of the MOBILE HOME PARK INVESTMENT process. Including 12 places
to find the BEST DEALS
Written for people that have little or no
experience investing in income producing real estate, or those who have
read MOBILE HOME WEALTH (Part One) and are ready to go to the next level.
Delve into the exciting and lucrative world of mobile home park investing.
Mobile home parks are the best kept secret in the real estate market.
Previously hidden from the average investor. The reason... successful
people dont want to make their business easy for competitors to copy. The
author is not concerned with that. There are thousands of mobile home
parks and hundreds or thousands of individual mobile homes for sale at any
time... plenty to go around for everyone. Jump in and join the fun.