Who’s Buying Up Mobile Homes Near You? How This Affects Your Investing Business?

Who are buying mobile homes near you? How does this affect your investing business?

This article was originally to be about market saturation concerning mobile home investing. However, while researching this topic, it was clear that before we can understand “market saturation” we must first identify our “competition” while investing in mobile homes either inside pre-existing land-lease communities or attached to private land we own.

Below is a short list of people/companies that may be competing with you in your area. These competitors want to lock up or purchase mobile homes before you can help these sellers and provide them alternative options. It should be your goal to reach every seller as quickly as possible. Aim to become well-known in your local market concerning mobile homes.

The 6 types of mobile home buyers you may see while investing.

6. Real Estate Agents/Broker companies

Threat Level: Low 

These companies do exist; however, they are not the competition — they are a “fair and competitive market.” After speaking with many dissatisfied sellers, it seems many realty companies may exert little effort and produce few walk-throughs for a seller’s home. As mobile home investors we may wish to regularly encourage certain sellers to list their manufactured home properties with a real estate agent if in their best judgement to potentially receive a higher purchase price. Our goal as investors should be to see sellers get the best offers that fit their needs and selling time frame.

Pro Tip: Aim for you or your advertising message get to almost every seller before he/she calls or get called by any local realty companies. In some areas there will be zero real estate agents or companies interested in these homes.

5. Mobile home buyers planning on structuring seller-financing payments to the seller

Threat Level: Low

While this is a reality, it is not a concern in most markets. As investors we may often sell via monthly payments as a business. However private sellers and private buyers working together typically does not happen. Interestingly, experience has shown that more than any other group Hispanic owners/sellers may choose to advertise a payment-plan in addition to an all-cash sales price. This payment plan offer is typically a slightly higher selling price compared to the all-cash sales price. Only in these areas do we mobile home investors begin to lose some of our edge.

4. The local mobile home parks themselves

Threat Level: Varying (Typically Low in most markets.)

On some occasions the seller’s own mobile home community will offer to purchase the mobile home. In some park lease agreements the management may even have “the first right of refusal” to purchase any mobile home inside its walls. A park will do this to protect the home from being removed from the community and/or to resell the home for a profit. From experience, many mobile home parks will only offer sellers pennies on-the-dollar compared to what the home is really worth. Keep in mind that while a park manager is only a short distance away, selling a mobile home to a park is usually a seller’s last resort. One exception is if the park has sold this home to the seller and the seller has defaulted on payments to the park. In this case it would be easier for all parties if the park simply takes back the mobile home.

3. Other mobile home investors

Threat Level: Varying (Typically Low in most markets) 

Compared to single-family home investors there are not many real estate investors interested in manufactured housing. Whether you only know a handful of mobile home investors or absolutely zero mobile home investors, this represents the norm around the country. Many investors simply turn their noses up to this type of real estate or ignorantly dismiss a mobile home’s potential.

Additionally, within the niche of mobile home investing there are other sub-niches to focus on, such as; handyman specials, senior citizen homes, co-op style parks, rentals, REOs, HUD homes on land, mobile homes that must be moved after purchase, and other areas of specialty to possibly profit from within your local market.

2. Mobile home buyers with approved bank financing

Threat Level: Varying (Homes 20 years and newer are more likely to qualify for bank financing with the right buyer.)

As of 2018 there are a limited number of lending programs for mobile home buyers in parks and on private land. Programs vary state to state. Due to lending restrictions many buyers will not qualify, or feel that they will not qualify and simply continue renting. In reality, if you are looking to sell a newer manufactured home then bank financing may absolutely be an option for your well qualified buyers

The threat level of buyers with bank financing varies from area to area, and even park to park, because of the different types of mobile homes you typically wish to purchase and resell/rent. If you only wish to invest in 4 or 5-star homes in 4 to 5-star parks, then these nicer homes will attract a larger percentage of bank approved buyers. However if you intend to invest in lower-end and moderately attractive parks, you will likely not run into many buyers interested in acquiring bank financing.

Pro Tip: Educate yourself by calling around to nationwide and local manufactured home lenders to find out their lending requirements, lending criteria, and next steps. Local credit unions and local banks are a great place to start with regards to financing local mobile homes in parks or attached to private land. Here are a few nationwide lenders: Traid financial services, CU Factory Built, and 21st Mortgage corporation.

1. Mobile home buyers with cash

Threat Level: Varying (Metro downtowns may have more cash buyers than rural areas.) 

Mobile homes are purchased and sold daily around the country. A majority of these private seller to private buyer transactions are all-cash type sales. With that said this buying demographic is not the majority in any marketplace. The number of buyers with $5000, $10,000, or $50,000 cash pale in comparison to the number of buyers that keep little savings and instead would love to arrange monthly seller-held financing payments. Said another way, cash buyers are few and far between in many markets around the country. Regardless, with proper marketing and an attractive purchase price, an all-cash buyer may absolutely be found for most any mobile home.

Who is not buying mobile homes in your area?

Almost everyone. As mobile home investors we are typically not competing against anyone, and therefore can network with anyone. Aim to get in touch with every local single-family home investor, investing company, and wholesaler you can find. Mention who you are and that you absolutely love mobile homes. Mentioned that you are interested in any unwanted mobile homes leads inside parks and homes attached to private land. The investor you are speaking to over the phone is your peer. These investors may or may not already be working with a local or not so local mobile home investor. Either way aim to make a connection and be placed on this investors buyers list. If time permits, aim to get an understanding of this other investors business and how you may help. Perhaps you may even run into this investor at a local upcoming real estate event.

In conclusion don’t let other people stop you from succeeding. Your purchase offers, creative terms, and/or cash are just as good as anyone else’s. Remember that in most areas of the country there is a healthy supply of mobile homes and mobile home owners in need of some help and/or guidance. Many mobile home investors need only one deal per month to stay busy. Continue reaching out to new sellers and keep making offers.

Love what you do daily,
John Fedro
support@mobilehomeinvesting.net

 

Related Videos:

5 Comments

  • jim jones

    Reply Reply January 6, 2018

    We found our main competition is with (2) local brokers. I also found that we will buy homes that they don’t want because they need substantial (structural) repair.

    We are on MH #10, and are experiencing parks where we work offering us trailers or letting us know who is about to sell, be evicted, is sick, etc so wee can get in the door first. So I guess if you make the park happy, they are inclined to turn to you when they know a lot is non-performing or about to become non-performing.

    It probably helps that we try hard to make the homes attractive on the outside as well as on the inside.

    Happy new year everyone

    Jim

    • John Fedro

      Reply Reply January 7, 2018

      Hi Jim,

      Great to hear from you. Thanks for reaching out and connecting. Congratulations on all the mobile homes and deals you have going. I’m curious if you’re holding these for cash flow or selling via cash. I have no doubt that these deals and successes did not come without a great deal of hard work and daily effort on your part. Keep up the great work moving forward!

      Very interesting about the to local brokers. Do you find that they say anything negative about you or try to dissuade people from calling you? Or perhaps they just know their stuff and when they list homes they actually sell them.

      Great job making yourself well-known in the parks that you are working in. Keep up just what you’re doing. In fact aim to find a few more park managers that are able to form friendly win-win relationships with. As always, if you ever have any follow-up questions or concerns moving forward never hesitate to reach out any time. Thanks again for following along and commenting. All the best.

      Talk soon,
      John

  • Wren Lightfoot

    Reply Reply January 6, 2018

    Thanks John. I see homes inside senior parks selling for hundreds of dollars sometimes with furniture too. In these parks they have signs and agents but it seems things dont move. I am only 43 and would love to buy some of these trailers cause some of them look good too. but Im afraid of not selling it. Thank you.

  • Wren Lightfoot

    Reply Reply January 6, 2018

    I live in las vegas if this helps. thank you for the video and help.

    • John Fedro

      Reply Reply January 7, 2018

      Hi Wren,

      Thank you for reaching out and connecting. Great job being proactive and hungry for a mobile home investment in your local area. If possible, try starting your investing career in all ages type of communities. Some senior parks will work with you when you approach them correctly and say the right things. They need to understand that you are not living in the home however will be reselling to a park approved senior citizen. They also need understand you will not be removing the home from the park and know that you have to get approved and pay on time every month. You may find some mobile home parks that obviously don’t want to work with you because of your age, however some absolutely will. These are also the parks that may give you discounted lot rent while the home is empty. You bring up a good point about homes not being able to sell sometimes in these communities. This is the same around the country in senior park sometimes. Beautiful homes, really beautiful homes, can be sold for less than a few thousand dollars, and the sellers are happy to get that by the time they actually sell. I certainly don’t want you stepping into the sellers shoes and purchasing a property that is very difficult to resell. Moving forward if you ever looking at a property or have specific questions feel free to email me over some pictures and questions if you have them. Happy to help if I can. Keep in touch.

      Talk soon,
      John
      support@mobilehomeinvesting.net

Leave A Response

* Denotes Required Field