Posted by Chuck (AZ) on June 26, 2001 at 08:55:57:
Yes, the smaller lots could be a liability down the road. The options are…
Replace the older homes with larger/newer ones, which would occupy more than one lot. This will most likely result in decreased revenue (fewer lots to rent).
Place “park models” into the same space as is currently occupied, go for the Senior market.
Convert to a RV Park (not likely in most cases).
Rip everything out and build apartments.
Personally, I’d go with #2 (easy conversion, less hassle, good tentants) or #4 (larger investment but greater return). The same space that would hold 50 MH’s would hold about 200 single-story 2bd apartments.
I have a 55+ park with a few RV lots left in it. I’ve decided to convert these lots to MH lots, but I’m having trouble finding smaller older homes to place on them. The lot sizes vary, making the task all the more difficult.
I just made a follow up post on commercial board to a question from a person that wanted to buy an older mobile home park with lots that are too small to hold the modern double wide or larger mobile homes. He or she is wondering if that will hurt them years down the road when single wides at the size in todays older may be obsolete and therefore the park could become a liability instead of an asset.
I am looking at an older park that is in excellent condition, but has that characteristic. There are a couple of double wide mobile homes in the park. They are 24 X 48’s and take up most of the lot. The single wides in the park have a yard and some have enclosed porches with storage building behind them and still look comfortable on lot.
I wonder if the supply of single wides that you can do Lonnie type deals may dry up in the future because they won’t be sold new and the ones available will be too old to be an asset in a park.
I notice a lot of what they call park models in rv parks that are fairly small. These look fairly new and are quite common. This makes me think that there will always be some market for smaller homes if they are more affordable.
I would appreciate hearing a conversation on this subject. Also, what kind of penalty should be considered for smaller lots.