Just to give a quick explanation:
First of all, a mobile home and land property (also known as a land-home property) is not a mobile home in a mobile home park nor is it the mobile home park. The owner typically owns both the home and the land, identical to a site-built home. You may find these in a rural area with one home on several acres of land, a neighborhood with homes on each side, or anywhere in between.
You may be thinking to yourself:
“Don’t mobile homes lose value? Why would I invest in a depreciating asset? After all, I’m sacrificing my free time to improve my financial position, not weaken it.”
I have found this to be inaccurate for the 10 to 20 year old homes that we acquire. More than likely, they will not appreciate like site-built homes; however, nearly all of the depreciation has already taken place.
So, buying an asset that stays relatively flat in value doesn’t seem that exciting. But then again, it depends on your motivation for investing.
If you’re like me and invest for CASH FLOW over APPRECIATION, then mobile homes may just be a better vehicle for you.
Let’s look at the gross revenue numbers first:
In my market (Columbia, South Carolina) with $100,000, I can buy 5 mobile home and land properties for $20,000 each (includes purchase price and repairs) that can be rented out for $600 apiece or $3,000 total per month. This same $100,000 could buy a 3 bedroom site built home that can be rented out for about $1,100 per month.
The cash flow is great and was probably the biggest reason for why I got into this niche, but I have learned that the local economics can be just as crucial.
I have seen way less competition in the mobile home arena. The mobile …read more