Posted by Steve-WA on July 21, 2003 at 11:01:13:
$
How hard to put mobile on a lot? - Posted by gregoryvg
Posted by gregoryvg on July 18, 2003 at 11:16:09:
My short term investment plans are to do Lonnie type deals for a couple of years to build up some capital. However, I don’t think I’d want to do these type of deals forever. I’m reviewing my mid to late term goals now and trying to come up with a general plan.
What do ya’ll think of this idea: Buying regular undeveloped lots and placing a MH on the lot. By doing this I can rent the land and sell the mobile, or rent the lot and mobile together.
Doing some preleminary figuring, If I expect to receive $650/month rent for the combo, the most I could pay for the lot, development and MH costs would be $35,455 if I wanted to receive a 22% ROI.
Has anyone here done anything like this? Do you need special zoning to put a MH on a lot? Any other advice or input?
Your plan can work. Consider a couple… - Posted by Dr. Craig Whisler CA NV
Posted by Dr. Craig Whisler CA NV on July 18, 2003 at 20:53:55:
…more points.
When you ‘roll your own’, all of your costs are cash. Noone finances a septic tank or backhoe work or a power pole or a water meter etc.
If you live in an area with a lot of mobile homes on private lots, drive around and look for lots with vacant slummobiles that can be easily replaced with nicer ones or where the mobile homes have been removed and there are weeds growing where there should be love and care showing. You can often buy such ‘used’ lots cheaper than you could develop your own.
One more thought re: buying finished mobile home lots. You can often negotiate seller financing with good terms. This would be valuable if you want to keep and rent your lot and/or mobile home. If you are going to flip them of course you would negotiate for a lower price rather than better terms.
You still might be able to buy on good terms without a due on sale clause in your agreement and flip them anyway by just wraping the first loan or by taking back a seond mortgage.
I have developed many lots, as you contemplate, and I have found them all profitable. They take quite a bit of work and time and cash but, yes your plan could be viable if the development numbers add up to a lower cost than value by a margin sufficient for you to feel it is worthwhile to do it this way.
Me? I am a fat, lazy, old man now. I just look for the easy ones, allready finished and negotiate like the dickens for my profit and/or good seller financing.
I think it would be a valuable learning experience for you to at least develop one lot and moibile combo as long as you can make a nice profit in doing so.
Steve’s experience in WA is becomming more common in Ca. There are now so many permit fees and everything costs so much here it takes all of the profit out self-developing lots. Last May they added a traffic mitigation fee of about $6,600 to EVERY building permit in my county.
At least Steve gets a septic tank for his 20K. All we get in CA is what goes into the tank!
Regards, doc
Wait for a deal on the land… - Posted by Philip
Posted by Philip on July 18, 2003 at 18:46:14:
and try to find it partially developed.
I know one poster on here who buys land with old mobiles on it …cheaper than raw land. He has a system set up to clean it up…and then puts in a newer used home.
I hope to get some of those going shortly.
Philip
Re: How hard to put mobile on a lot? - Posted by Steve-WA
Posted by Steve-WA on July 18, 2003 at 13:48:01:
you’d better back off a little there gregoryvg.
“What do ya’ll think of this idea: Buying regular undeveloped lots and placing a MH on the lot.”
Translated into reality-ese:
Buying regular undeveloped lots, ** putting in a septic system (~15K for my area), running water lines and electricity,** and placing a MH on the lot.
Better check on the development costs before counting your chickens.
Generally, there are zoning issues, so there is heaps more than just buying land and plopping that ol’ trailer down, and then easy money.
Check wiht your local building permit issuers for the zoning stuff, and ask around for good recommendations for contractors to do the development, and movers to place the MH.
This is a big bite to chew for the uninitiated.
It’s Like Two Apple Trees - Posted by Tony-VA/NC
Posted by Tony-VA/NC on July 19, 2003 at 09:11:53:
I agree with Doc on this one.
Money can be made in developing lots but it is cash intensive, red tape cluttered and you are at the mercy of contractors. Now all of this can be streamlined but on your first time out, you will be behind the eight ball. Not to mention you don’t begin receiving cash for months to come.
I liken the comparison of deals to apple trees. You can spend time digging a hole, planting a tree and waiting for it to produce fruit, or you can walk over to a mature apple tree, trim it, water it and begin to reap the fruit now.
People in areas such as Steve where the permits alone cost more than the land I target, will find the older, already developed lots to be much easier to deal with.
The turn around time is much quicker. Typically repairs to the home only or even a scraping of the old and the moving in of a newer home.
Seller financing becomes a great option here. Banks and other lenders will more readily lend on properties already created. The can see them, they can see the tax assessed value (a key number in my lender negotiations), etc.
These lots are out there but like any niche market, you have to find a means of accessing that market. Once you do, you can likely ride the waves of high’s and low’s that all markets experience. Some months it rains deals, the next it is tough to locate a good base hit of a deal.
At some point we need to decide where our time is best spent. Doing deals that make money sooner is the bread and butter pipe line. Developement deals might be decent all cash sale alternatives that can provide additional seed money for other long-term income streams such as land/home package rentals (in whatever format).
Tony
Re: Your plan can work. Consider a couple… - Posted by Ed C (CA)
Posted by Ed C (CA) on July 18, 2003 at 23:42:06:
Good to see you up & running again! Folks, I happen to know that you can get “Doc’s” attention/appearance/apprecation with Mexician food! Just a hint if you don’t like McDonalds.
Re: How hard to put mobile on a lot? - Posted by Elizabeth (WA)
Posted by Elizabeth (WA) on February 20, 2006 at 24:48:32:
After doing a days worth of research into the requirements imposed by the county (at minimum) I?ve come to the same conclusion. It?s far too costly and time consuming to develop raw land for this purpose (at least here)? kind of gives insight as to why even old properties keep growing and growing in value here in King County.
pat on the back for avoiding this can of worms!
Getting the details beforehand pays off. I think a lot of investment nightmares can be avoided through thorough contingency planning, research, and running the numbers past someone who?s not emotionally involved. We?ve all done things we knew were dumb with our money, even at the time, because of emotions.
-Elizabeth
15K for Septic Install??? - Posted by Tony-VA/NC
Posted by Tony-VA/NC on July 18, 2003 at 17:40:05:
Steve, what did they do start making those West Coast stystems out of pure gold?
We put the last system in for under $3k (typically run about $2,500).
And you are right about the zoning and contractors being important, key factors in this endeavor. Knowing your contractors first will be a huge help.
But otherwise, in my area, it would not be hard to develope a lot and bring in a decent single wide for under $35k (as Greg posted). In fact, one might get a new, wholesale double wide in for a bit more than that here. But everything changes by location.
Tony
Re: It’s Like Two Apple Trees - Posted by Lonnie
Posted by Lonnie on July 19, 2003 at 10:30:51:
?Like planting apple trees?. That?s a great comparison, Tony. Good post.
Lonnie
Re: $1,400 for Septic Install - Posted by jim jr
Posted by jim jr on July 19, 2003 at 16:54:34:
Here are some numbers from a septic I had installed two weeks ago in South Carolina.
perc: $100
price of tank, dig and installation, plus all extra hardware: $1,400 (that price also included having the land cleared and having a driveway cut)
I know we got a good deal because the same guy cleared the lot and cut the drive who installed the septic tank, and he basically cleared it for free. The work was so cheap because he is a friend of my Dad, but the numbers on the septic tank installation are not much higher in my area.
generalized - Posted by Steve-WA
Posted by Steve-WA on July 18, 2003 at 22:15:54:
septic design
permit
perc
drain field dig&install
tank buy&dig&install
14Karat, bay-beeeee!
Re: 15K for Septic Install??? - Posted by Philip
Posted by Philip on July 18, 2003 at 18:44:05:
Tony I think your cost of living must run about the same as my area. Those are almost the exact figures for septic as my area.
Regulations on the coast make one septic cost more than a whole deal here.
I just bought 4 acres(.92 acres required for each septic), with 2 septics in place, 3 legs of electricity, 2 of them mobile sites with meters, with one old, old mobile on-site for 14k.
These sites have been vacant about 7 months, due to people loosing the land for non-payment, so it was a bank repo.
I have scheduled much of the cleanup work done and contacted the rural water(it is in place, just $100 deposit for hook-up) company. I have a used single wide purchased, with a mover hired, to go onto the first unoccupied site. I will have to get surveys done before parcelling the lots off.
I didn’t buy an income stream, but I will have one without too much money or time or effort above the cost of the mostly developed land.
Most people had shied away because it was a mess. 7 months of growth and blown down metal buildings to clean up.
Cost me $250.00 to clean up the buildings.
Re: 15K for Septic Install??? - Posted by Dave - WA
Posted by Dave - WA on July 18, 2003 at 17:42:59:
I have never installed a septic system, but knowing this great state as I do, I would venture to guess that $10k of that is just for the permit.
what about a drain field? - Posted by Steve-WA
Posted by Steve-WA on July 19, 2003 at 18:40:37:
Is it abbreviated? Or is it not necessary, cause all the water from the tank goes right into the crick?
Then we catch them crawdads for supper! Yum yum!
j/k; I do not mean to offend - sometimes I just do.
Re: 15K for Septic Install??? - Posted by Lyal
Posted by Lyal on July 18, 2003 at 21:28:02:
YOU GO PHIL!! Great stuff!
Lyal
Our “involved” system was 8k - Posted by Wills
Posted by Wills on July 21, 2003 at 10:02:48:
Cost all depends on where you live I guess. Five years back we bought a new home in PA that had been subdivided to 8 acres from a much larger piece of property. Lots over 10 acres weren’t required to have any septic system till a few years ago. Because of the subdivide and sale the home needed a new septic system and the ground would not perk (clay). Since there was already a home on the site the state had to allow a grand fathered in septic system but they could dictate what sort of system.
The system consists of 2 1000 gallon septic tanks plus a 250? gallon pump tank and a 500 gallon contact/ chlorinator tank and a gravel/sand mound. The raw water passes through the 2 septic tanks to the pump tank and on a float valve is periodically pumped to inside the sand mound. After the water passes through the mound the water flows by gravity to the chlorinator tank that has two tubes in it that you drop chlorine tablets into.
This is a very involved system. Thankfully the sellers had to pay for the system not me:) Plans parts labor all of it was 8k so 15k for a simple system where you live geez. All I can say is i’m glad I don’t live there.
Re: Well Yee Haw!! - Posted by jim jr
Posted by jim jr on July 20, 2003 at 12:02:23:
Yes that price includes the drain field, and yes they are required here. That price included all of the work involved.
You are not offending anyone from South Carolina, I assure you. Crawfish be some good eatin’. Plus, most of us have a out-house, so we are proud we can get us one of them there tank and toilet get-ups. 
Re: what about a drain field? - Posted by Tim
Posted by Tim on July 20, 2003 at 07:17:00:
I don’t recall right off hand how much perk tests run, but here in Auburn, Al. septic tank installations complete with field lines cost between $1500-2000 for a regular system. If you’re soil doesn’t perk well then an engineered system is required & can cost considerably more, but most places perk.
Re: what about a drain field? - Posted by Philip
Posted by Philip on July 20, 2003 at 06:49:03:
Steve,
A perc test by a state soil scientist lets us know how many feet of lateral lines(drain field?) to install. That test, installation of a 1000 gallon septic tank, and average amount of lines, with all the plumbing hookups costs about $2,500.00-3k around here.
The Missouri Dept. of Natural Resources tries to do a good job of regulating the use of land, without completely running all small contractors out of business. You are required to have an acre of land, minumum per septic.
Most land in the southern half of the state has 1-9 inches of topsoil and then quite a bit of rock…and the soil type is usually just a regular loam. Unless you hit a hardpan(fragipan) of rock, or in the extreme southwestern tip, some clay, you usually perc fine.
In our state I think they balance the requirements well…and leave the crawdads(which I love) without fecal chloryform!
Philip