Posted by Dr B. (OH) on October 11, 2007 at 09:58:30:
Yes, you refinanced it for $525K but I believe Jen is saying you have very little dough OUT OF YOUR POCKET for this park. So if you sold it for $550K to pay off the note and expenses, you get to keep a half million for a 1031 exchange or for yourself pre-tax, no?
Steve
Selling Lots - Posted by John Stapleton
Posted by John Stapleton on October 08, 2007 at 11:17:40:
3 Years ago I inherited a 40 unit MHP, it was left to me with 10 lot rentals $175 each (much lower than the other parks in the area that are $225+) and 30 park owned units rented for $525 per month. I refinanced it at $525,000 @ 7.5% 30 year loan. I am running at 30% expenses. It is 100% occupied, and has never dropped below 90% for more than a month in the last 10 years.
I know nothing of the investment business and luckily the manager has been fair, but he is going to retire and I canâ??t run it from Florida, itâ??s in New Mexico. Is there a legal way for me to sell of the individual lots?
In looking at the numbers I am thinking $21,000 is a fair price per lot, and the lots with the units I can sell the units at a high discount. I know for an investor a 10% return is not anything to drool over, but considering they can put their own unit, or already have a unit they can get $525 a month would make it a 25%-30% return (depending on the cost of the unit), as long as the unit lasts or if they sell the unit back to the renter they will make 30% for the life of the loan and 10% there after. Is there any legal aspect I am missing, since I owe money on the park and donâ??t own it outright would this even be legal? I know long term I can make much more money from the park if I keep it, but $300K profit would also be nice. After all there is no way I can sell it for $800K, there are parks just as nice for sale cheaper in the area. What happens when I sell of all the units, Who would actualy own the park?
Re: Selling Lots - Posted by james(CA)
Posted by james(CA) on October 09, 2007 at 11:09:03:
I’ve emailed you for more info. --James
Re: Selling Lots - Posted by Jen
Posted by Jen on October 08, 2007 at 20:38:16:
How do you figure your profit of 300k when you have 0 in it? I would just sell the park as is and be thankful for the sweet inheritance!
Re: Selling Lots - Posted by John Stapleton
Posted by John Stapleton on October 09, 2007 at 09:04:38:
I have $525K into it from the refinance.