Posted by Jared-MA on November 24, 2005 at 18:53:39:
Thanks for the reply John. Your input is helpful.
mobile home deals - Posted by Jared-MA
Posted by Jared-MA on November 22, 2005 at 20:04:57:
Ok, I am new to mobile homes and I have posted a few questions about starting to invest in them. I have just read “deals on wheels” by Lonnie Scruggs as was suggeted to me (twice). The book was very good, but the prices it tells you to stay in (1k-6k) is totally unthinkable where I am in Mass. I found some cheapos around 15k in really bad parks. Normal “bread and butter” used homes average around 25-45k. Will these Lonnie deals still work for me with these prices? Or should I wait until I find a miracle and find one under 10k??? Thanks for any help.
Re: mobile home deals - Posted by Anne_LLC
Posted by Anne_LLC on November 26, 2005 at 10:35:49:
Hi Jared,
Welcome to the world of MHs. I’m glad to hear that you read Lonnie’s book twice, and it sounds like you are doing some homework on your area. This is good.
One reason I suggest that people read and re-read Lonnie’s book many times is that the essence of money making with Paper is contained therein. A superficial reading tells you about Mobile Homes, but really it’s a book about how money works, and its simplicity is deceptive.
Another point I would make is that although you say that “bread and butter” homes average around 25-45K, I wonder how many park managers you’ve spoken to yet. They are the source of all things free or cheap. The PM is the KEY.
Last year at the St. Louis CREOnline conference I met a young man who was in college. He didn’t feel that he was in a position to sell MHs, but when he read Lonnie’s books he realized that he could apply the general principles to items other than mobile homes.
He noticed that when other students were leaving town they’d sell their cars for significantly below blue book value. So he bought the cars from motivated sellers and then sold them with payments to buyers for their “real” value.
My point is, get yourself a financial calculator and re-read the books again. Talk to some PMs. If you have to move, then contemplate a move. Use your noodle.
good luck,
Anne
Re: mobile home deals - Posted by John Corey
Posted by John Corey on November 24, 2005 at 13:58:19:
Jared,
Prices do vary.
The spread is one critical element. If you can buy for $15K and sell for $45K then you have the difference you need to get the higher rates of return.
Better is when the prices are lower as you have less cash tied up, the monthly are more affordable to the buyers and you will likely get more of your cash back from the down payment.
So, each market is different and you need to tweak the model. Lower is best. Spreads between buy and sell price are what is critical.
BTW - As MA is not that large of a state you might find better numbers north or south of the boarder (or west if you are near NY). Property taxes and land prices are a factor so looking for less expensive areas helps.
John Corey