# buying land and placing 2 homes on - Posted by batpro

Posted by Chuck (AZ) on July 03, 2001 at 24:41:53:

Price of the land + Fill and Level + Sewer and Water = \$6800, let’s say you get the homes for \$3k each which makes it \$12,800 plus the moving cost, let’s say it’s \$550 each, makes it a \$13,900 investment.

If you rent both homes at \$400 a month each (no lot rent) = \$800/mo. At this rate, it’ll take 17 months to recoup the investment, plus you just became a landlord.

Now, let’s say that you sell each home. You get \$1000 down each, \$5k balance at 12.75% for 36 months. The payment would be \$167.91/mo. each.

In addition, you could charge lot rent. Let’s say it’s \$150/mo. each.

So the numbers here are…
\$2000.00 back in down payments (\$1000 x 2)
\$335.83 a month in note payments (\$167.91 x 2)
\$300.00 a month in lot rent (\$150 x 2)
Plus you’ll earn \$2086.00 in interest (\$1043 x 2) over the life of the notes.

So… \$13,900 - \$2,000 - \$2086 = \$9814.00 …at this rate it’ll take 15 months (at \$635.83 - 2 notes plus lot rent) to recoup your investment.

You say it’s 8 lots, yet you only mention 2 homes. What’s with the other 6 lots? IF indeed you can place homes on them (rezone?), by all means do so. Adjust the figures above accordingly and stand back when you calculate the yield. The potential in lot rent (as in forever), makes this worth persuing.

I bought a 9 space recently just for fun. The lot rents bring in \$3k a month. I’ve Lonnie’d each home for \$250/mo. to the current tenant, and they pay all utilities. You can figure the yield if you want, I think it’s “good enough”… my investment cost was (believe it or not) \$139,000 (10% of that is \$13,900).

buying land and placing 2 homes on - Posted by batpro

Posted by batpro on July 02, 2001 at 21:54:11:

Hello,

I purchased Deals on Wheels and read it.

I am buying 8 lots in a small city. The cost of the land is \$2800. I am going to put 2 mobile homes on there and hook up to city water and sewer. This is allowed in this city. There is city water and sewer there and the city said I could split it for the two homes. I am looking for homes for \$2500-\$3500. The move cost is about \$500-600 per unit.

The lots need to be leveled and fill brought in for an additional cost of \$1500 and there is a cost of sewer and water hook up for \$2500.

Is this a good move to do this? Units rent for around \$400 per month. I also wondered about selling the home on a loney deal and renting out the land.