Hiatus

The blog will be on hiatus for the next few weeks. Will be back soon. Stay tuned!

Mobile Home Park Maintenance Inspections

(Note: Inspections and regulations for mobile home parks will vary and depend on your local area laws. Check with your local government housing authority with any questions regarding inspections and local regualations).

Very informative video on mobile home park maintenance inspections. For those interested in working in and/or buying a mobile home park, it definitely has some good information. Check it out!

(p.s. If you're interested in reading more about the pros and cons of buying a mobile home park, check out this article).

"This video is designed to assist mobilehome park residents and owners prepare for a Mobilehome Park Maintenance Inspection (MPM) and points out common violations discovered."



Video Link

Investing 101: Learning the Market

By far, knowing the market is the most important key to success in investing in mobile homes. If you do not know your market, you will not be able to find a good deal. Why?

It's simple. If you do not know your market, you will not be able to see a deal if it comes across your desk because you do not know the values and prices of what people are willing to pay for that particular home in that particular area. Not knowing the market is dangerous and can lead to bad deals and/or missed opportunities.

So many times, I get folks telling me they can't find any mobile homes for $3,000. They tell me they've been looking in the newspaper, been driving around their area looking in parks and surrounding neighborhoods, online websites, etc. But, for some reason they still can't find a deal.

The reason they can't find a deal is because they do not know their market. How do I know this?

As soon as I hear they are looking for a mobile home for $3,000, I know they are not familiar with their market. If you knew the market, you would be able to spot that there may be different ways and different price points to make things work.

For example, what if a lead came across your desk for a mobile home and the seller wanted $10,000? Well, if you are looking for mobile homes for $3,000 you might just pass on that lead. Then, someone like me (who is knowledgeable with the market) knows that a $10,000 home in that area could sell for $25,000 owner financed. Or, I may have a cash buyer who is looking to spend $15,000 for a mobile home to put on their land.

So, you see the person looking for $3,000 mobile homes lost out. If that person knew the market and the demands of the market, they may have been able to put together a deal. Instead, it passed them by.

This is one of the reasons why I believe a lot of folks tell me they can't find any deals. They just do not take the time to learn the market.

In my experience, I find a lot of people just starting out are very impatient. They want to find a "deal" right away. They rush out looking for mobile homes at a certain price point, say $3,000, and spend all their time and effort doing this. Then, they say that they can't find any deals and say mobile home investing does not work.

I'm going to be honest with you, this business takes time. Success does not happen overnight. But, it can happen with enough persistance and belief that you can achieve your goals.

When I first started out, it took me 6 months to learn my market. Then, it was another 2 months until I did my first deal. In total, it took me 8 months to learn my market and accomplish my first deal.

To a lot of people, that seems like a long time. But, it paid off because I know my market very well now. The time I took to learn it has made me better aware of the types of deals I can put together based on the demands of the market.

If you are interested in investing in mobile homes, take the time to learn your market. Do not be impatient. It's an investment in you and your future.

By learning your market, you will obtain the knowledge to help you spot a deal. Kiyosaki once said, "You do not see with your eyes, you see with your mind."

If you have the knowledge in your mind (by knowing your market), that knowledge is power. And, the power of knowledge will lead to your success.

I'm going to leave you here with a video from John C. Maxwell that inspired this post.

Happy Investing!



Video Link

Terminology Tuesday - Cinder Block

(A stack of rectangular concrete blocks). Source: Wikipedia


(Note: I think it's important to know the terminology and words used when learning any new business including mobile home investing. I came up with 'Terminology Tuesday' as a day to go over the terminology used in the mobile home business. It's important to know the terminology when talking to people in the business so you're all on the same page).

As defined in Wikipedia:

"Cinder block may refer to:

In the United States, a concrete masonry unit (CMU) — also called concrete block, cement block or foundation block — is a large rectangular brick used in construction. Concrete blocks are made from cast concrete, i.e. Portland cement and aggregate, usually sand and fine gravel for high-density blocks.

Sizes and Structure

Concrete blocks may be produced with hollow centres to reduce weight or improve insulation. The use of blockwork allows structures to be built in the traditional masonry style with layers (or courses) of overlapping blocks. Blocks come in many sizes. In the US, the most common size is 8 in × 8 in × 16 in (20 cm × 20 cm × 41 cm); the actual size is usually about 3/8 in (1 cm) smaller to allow for mortar joints."

Definition Link

Cinder blocks (aka concrete blocks) are used to support a mobile home. Concrete blocks are placed underneath a mobile home for support.

When moving a mobile home, the mobile home mover will attempt to remove the concrete blocks from underneath the home to prepare for the move. Once the mobile home has been transported to its new location, the concrete blocks will need to be placed underneath the mobile home again for support.

One thing you want to be sure when negotiating a move with a mobile home mover, is to see if the price quoted includes removing and replacing the concrete blocks. Some mobile home movers will only quote you a price to move a home, but may not include the removing and replacing of the concrete blocks for the move and the new location of the mobile home once transported.

Here's a video showing a mobile home move in preparation. In the video, you'll see the concrete blocks being removed from underneath the mobile home to get ready for the move. Check it out!



Video Link

The Realities of Real Estate

With the changing market of real estate, I thought I'd post up this very entertaining yet informative video on how different people view the value of real estate. This is definitely worth a watch. Enjoy!

"Everyone in the real estate transaction sees the home differently."



Video Link

Investing 101: Finding Buyers

I thought I'd address the age old question a lot of folks have been asking me lately, "How do I find buyers?"

If you are investing in mobile homes and plan to buy and hold the paper, the question is not, "How do you find buyers," but "How do you find the right buyers?" There's a big difference. Why, you ask?

The difference is that if you find the right buyers, you are working with people who are in it for the long haul. You are working with people who really do want an affordable place to live and call their own. By having a place to call their own, they will take care of it because it is theirs. Why would they ruin something that they own? You are working with homeowners.

Real homeowners are people who love their home so much that they are willing to do anything to save it. If something happens to them financially, they will do all they can to either try to work with their lender and/or get another source of income to help pay for their home. The mindset is that they do not want to lose their home.

On the other hand, if you are just out there to fill your homes and find buyers just for the sake of it - you are not working with people who are in it for the long term. You are working with people who may not really want a place to call their own. Actually, they may be running away from someone or something, and may just need a place temporarily.

They may tell you they really need a place and may even suggest they want a place to call their own. However, in reality they just need shelter for the time being. Are they looking for a long term situation? Maybe. Maybe not. And, that "maybe not" can be the start of a headache for you.

For example, I had a buyer who applied recently. Basically, he told me he really needs a place to call his own and wants to get into something asap. He told me he's living with relatives, going month to month right now. Told me that he's got a good job - been working at the same job for 10 years. But, his credit is not so good.

Ok. So, I wonder if he's got such a great job then why is his credit shot? Why has he had trouble paying his bills to make his credit not so good? I wonder.

So, he applied for the home - filled out the application and submitted all the required paperwork. The park did a credit check on this individual and yes, his credit was not so good. He had a very low credit score.

From the credit report, what I found out was that this potential buyer was 90 days past due on a home mortgage. He failed to mention this to me. In turn, the park manager called him up and told him what we found. It all came out over the phone.

The potential buyer told the park manager that he was currently in default for the home that him and his wife own - they are in the process of getting divorced. He told the park manager that he needs a place asap as the bank is going to be foreclosing on them soon and he's afraid he may be locked out of his house.

So, the park manager asks him straight out, "Are you planning to walk away from the home?" The potential buyer says "yes."

That's all I needed to know to make my decision. This was not someone I wanted to work with. Why? If this person walks away from an obligation, especially his home, what makes me think he won't do the same thing to me? Enough said.

So many times, I hear investors say how they just need to find a buyer(s) for their homes and just want to get them filled. They tell me they don't care and as long as they are getting paid, they're happy. Then, they tell me it's ok because if the buyer(s) defaults, then they can go ahead and take back the home and do it all over again. Simple as that, right? Not in reality.

In real life, if someone defaults and you put the wrong buyer in there with the wrong mentality (by wrong mentality, I mean someone who is not willing to cooperate and/or work with you), it could turn out to be your worst nightmare. And, by nightmare I mean those nightmares that haunt you for the rest of your life.

Have you ever heard the saying, "It's better to have a vacant house than it is to have a problem tenant?"

According to Murphy's Law, "Anything that can go wrong will go wrong." So, it's better to do things right the first time - find a buyer(s) who will take care of the home and really wants a place to call their own.

This is a long term investment - your investment. If you gamble by putting the wrong buyer(s) in the home, you are putting your investment at risk as well as your sanity. It's better to be safe than sorry.

I'm going to leave you here with a video from John C. Maxwell that inspired this post.

Happy Investing!



Video Link

Terminology Tuesday - Polybutylene Pipe (Aka "Grey Pipe")

(Note: I think it's important to know the terminology and words used when learning any new business including mobile home investing. I came up with 'Terminology Tuesday' as a day to go over the terminology used in the mobile home business. It's important to know the terminology when talking to people in the business so you're all on the same page).

As defined in Wikipedia:

"Polybutylene is a thermoplastic Polyolefin. It is created by polymerizing butylene. It is a semi-crystalline thermoplastic, and is also known as polybutene-1. It should not be confused with polybutene, a low molecular weight oligomer with a different repeat unit.

Controversy

The suitability of polybutylene for use in plumbing is controversial. Polybutylene plumbing was used in 6 to 10 million homes built in the United States from 1970 to the mid-1990s. Problems with leaks led to a class action lawsuit, Cox vs. Shell Oil, that was settled for one billion dollars. Polybutylene plumbing is still widely used in Europe and Asia.

The material oxidised when used in hot water systems, developing longitudinal cracks which eventually punctured the walls leading to floods and damage to properties. Many acetal resin fittings also cracked, a problem caused by chlorine attack. Even the low concentration (ppm) of chlorine used in most potable water supplies for purification was enough to initiate cracking."

Definition Link

Polybutylene pipe is usually referred to as "grey pipe" because it is grey in color. The majority of mobile homes built before the year 2000 will usually tend to have it.

In my experience, most sellers I have dealt with have taken out the old grey pipe and replaced it with PVC pipe - usually white in color. However, there will be cases where "grey pipe" still exists in the mobile home.

When you go to inspect a mobile home, be sure to look under the sink - see what kind of piping they have for each room with a water supply. Run the water from the sink and test it out. Look under the sink to see if there is any leaking.

Be on the lookout for a bucket under the sink near the piping - this will signal you that there has been prior leaking. If you see "grey pipe," chances are there will be cracking and/or future cracking down the road. These are issues that will need to be addressed in negotiations.

Happy Investing!

(If you enjoyed this post and would like to read more about mobile home repair, check out these books. Enjoy!)

This Is What Happens When Lot Rent Isn't Paid

I thought I'd post up this video on what happens when lot rent isn't paid. Check it out!

"This is a video of a guy who hadn't paid his pad rent."




Video Link

Investing 101: Real Estate Is A People Business

(Note: Image courtesy of LumaxArt)

"Everyone always wants some new things. Everyone likes new inventions, new technology. People will never be replaced by machines. In the end, life and business are about human connections."

Michael Scott, The Office

With the evolution of technology today, it's very easy to get lost in all the "noise" of the Internet superhighway. Right now, there is a lot of hype out there about social media and its usage regarding platforms such as Twitter, Facebook, MySpace, LinkedIn, etc.

With all the hype and talk about social media, it's very easy to get confused and "lost" in what its true value can bring. Social media is a tool that can help build your business. Notice I said "tool," not substitute.

A lot of people are under the impression that social media is a substitute for doing business - it's not. There is no substitute for good old fashioned networking - human interaction face to face and/or via the telephone.

Sure, you can network with people online and build a great Twitter, Facebook, MySpace, etc. following. However, when it comes down to doing business you have to ask yourself the question - Is this really helping you and your business get to your goals? If it's not, then you have to change gears.

So many times, I get folks telling me they can't find any deals. They tell me they've been looking and looking and can't find any mobile homes for $3,000. They tell me they've been looking in the newspaper, been driving around their area looking in parks and surrounding neighborhoods, online websites, etc. But, for some reason they still can't find a deal.

Well, I'm here to tell you - you won't find a deal advertised in the local paper and/or online. It just doesen't work that way. Deals are made through negotiating - not through advertisements. Probably every single one of my deals, the seller started at full retail price. Let's face it - most people start there because no one wants to get ripped off. It's just human nature.

Where the deals come in through negotiations is really getting to the root of the problem(s) of the seller and getting to know each other by creating win/win situations. When I meet a seller, I have a very casual approach. I do not do any hard selling at all. I let the seller talk. I listen and see what exactly the seller wants to do and why they want to do it. It's that simple.

Ok, so if it's that simple - how come it's so hard for people to make deals? The reason it's hard for people to make deals is because they come across to the sellers like they just don't care. How is this?

Well, most investors come off as "vultures" because they try to do all the talking and tell the seller what they should do - tell the seller what their home is worth and what they can expect them to sell it for. Then they go on and try to scare the seller saying that no one's going to buy their house for that price. This is a big turn off for sellers.

Let's face it - no one likes to be bossed around. If someone pushes, we push back. It's just human nature. This is why it's hard for most investors to make deals - it seems like they just don't care. So, what happens is the few who do make the deals come out the winners because they are the ones who demonstrate to the seller that they do care. And, if someone shows that they care for you - they will in turn care for you back. It's just human nature.

Right now, I'm working with a park - the park manager is basically kicking out all of the investors who bring bad business to the park. What's happening is these investors just let anyone into their mobile homes and don't really take into any consideration of the park and the obligation to pay lot rent.

Their attitude is they really don't care if their buyers and/or tenants don't pay lot rent - all they care about is getting their own payment and/or rent. I was actually in the office hanging out with the manager one day when a tenant came into the office. She told the manager that she just couldn't pay the lot rent and that the investor who owner financed her home told her she doesen't have to pay lot rent as long as she pays the mobile home payment she's ok. The park manager blew up and got really mad.

So, now the park manager is asking these investors to leave her park. They will have the option of either moving their homes (with their buyers and/or tenants) or they will have to sell their homes. (Note: This has been a concern for many people wanting to get into mobile home investing. Yes, I have heard of other investors who have been kicked out of parks and it's a possibility if you bring bad business to the park. For me, I bring good business to the parks and find quality, long term tenants. In fact, the park manager and owners want me to keep doing business in their parks. As long as their lot rents are getting paid, they are happy).

In addition, I'm also working with the park manager for some of the park owned homes as well as some of the bank owned homes in the park. For most parks, they just want their lot rent paid. Doing owner finance mobile home deals is not their forte. So, what happens is they may have to do them because they get stuck with some of these homes and they end up going bad. They would rather work with someone who knows how to fill homes with good quality buyers and/or tenants than have to fill them themselves.

So, you see - it's all about human interaction and creating win/win situations for all. Most investors out there are out to create win/lose situations. Sure, they may be able to snag a deal or two but they won't last for long.

As Seth Godin points out, the only way you can get people to do business with you is to have them talk about you. No amount of advertising and marketing can change the way people see you. If you build your business with an honest reputation of helping people and creating win/win situations, people will spread the word and refer others to you. It's as simple as that.

The reality is most investors put dollars before people. When you put money before anything else, you will lose. You will lose out on deals, long term relationships and you will lose out on business. Money is just short term.

Building relationships and a reputation for being honest and helping people is long term. In the end, business involves people. And, people never go out of business.

I'm going to leave you here with a video from Gary Vaynerchuk that inspired this post.

Happy Investing!

(If you enjoyed this post and would like to read more about negotiating, check out these books. Enjoy!)



Video Link

Terminology Tuesday - Mobile Home Skirting

Mobile Home Skirting is material used to cover up the exposed area of a mobile home which usually goes around the lower bottom portion of the home.

There are many different types of materials you can use to "skirt" a mobile home including vinyl, wood, cinder block, brick, fiberglass, etc. The most common material used is vinyl skirting which is usually white in color.

Most mobile home parks will require mobile homes to be fully skirted. When moving a mobile home, one of the cost considerations is purchasing new material to re-skirt the mobile home once in a new location. (If you're interested in getting an idea of what's involved when moving a mobile home, check out this video).

If you're a handy person, you could always connect with a mobile home mover in your area and purchase and/or ask for used skirting from their mobile home moves. In most cases, mobile home movers will just rip out the skirting and throw it away when getting ready to do a mobile home moving job. If you're handy with tools, you could always learn how to remove the skirting and do that part of the job for the mover in exchange for the used skirting.

Here's a video so you can see what mobile home skirting looks like and the process to keep it in tact.

(p.s. Warning: The music is a little hokey but it's a good video overall on the subject).

Happy Investing!



Video Link

Trailer Park Life

Thought I'd post up this very informative video from Jolene Sugarbaker, "The Trailer Park Queen", as she fills you in on the trailer park lifestyle. Check it out!


Video Link

Investing 101: The Importance of Learning A System

"How do I get started?"

This is probably the most frequently asked question I receive from folks looking to get started investing in mobile homes and/or real estate. It's a pretty common question.

Many people want to get started investing in mobile homes and/or real estate but just don't know which direction to go. There are many ways to make money in mobile homes and/or real estate. Though, I'd like to point out that what you do will depend on your overall financial and personal goals for yourself.

I've received many different types of feedback from folks who tell me this investor told them to do this and/or this investor told them to do that. In fact, there seems to be an ongoing discussion among many real estate investors regarding which is the best way and/or method to invest in real estate.

My answer would be - it doesen't matter. What matters is what's best for you and your goals. If you're happy with your life and plan to work until you're 55 and are just looking for a place to park your money for retirement, that's ok. On the other hand, if you're unhappy with your 9-5 job and looking to quit and want to build up a stream(s) of income to replace your current income - that's ok too.

You have to do what's best for you. There will be a lot of people out there who will try to convince you to invest in this and/or invest in that, or tell you to do this and/or to do that. But, you need to keep in mind what your own goals are in life. They may be similar or different from others. That's ok.

Once you have your goals down, then you will be ready to start working towards them. Take action and make things happen.

When I first started out in real estate, I knew what my financial goals were and I made a plan to achieve them. For me, the problem was choosing a system and sticking with it. As many people know, there are many ways to make money in real estate.

With all the different systems out there, I tried to learn all the systems. Why? I figured it would be best to know them all because I didn't want to miss out on a deal if it came across my desk. Big mistake. Ever heard of the saying,"Jack of all trades, master of none?" That was me.

I ended up doing a couple deals here and there. I found some deals for investors using every single technique out there - subject-to, lease options, seller financing, etc. Then, I got into wholesaling REOs. And, eventually landlording. What happened was that I was burnt out - big time.

I didn't feel fulfilled in what I was doing. I was burnt out from all the marketing, taking calls, driving, networking with other investors, etc. At one point, I was working with 30 bird dogs. It ended up being way too management intensive - talk about burn out! I felt like I had no life. Literally. I had no energy to do anything else. Everything was about real estate - I felt like I was chasing every deal possible out there and had no time for anything else. I wasn't living life anymore - I was just working too hard.

Finally, I had enough of it. I took some time off to reflect and think about the kind of life I really wanted. I realized that I was no longer doing things that I enjoyed anymore. Ironically, the whole point of entering into real estate investing was for me to have time to do the kinds of things that I enjoyed. This was not it.

So, I did some more reading and soul searching. And, I stumbled upon mobile home investing. What I really liked about mobile home investing, was the philsophy behind it - having the time to do the things you like doing. Also, I felt like I could relate to Lonnie Scruggs, "The Godfather" of mobile homes, because he was a burned out landlord when he started as well.

Upon spending more time reading about mobile home investing, I soon realized this is exactly the type of system that would give me more time to do the things I enjoy. For me, it was all about lifestyle. I did not want to be a landlord anymore, and I didn't want to spend hours upon hours constantly looking for deals for other investors and/or in a rehab project. That just wasn't me.

Mobile home investing was perfect. So, I dove into the wacky world of mobile home investing. And, here I am. It's much more fun. I can truly say that I enjoy what I do now. I think it's mainly because it allows me to have more free time which allows me to do the things I like doing and above all - enjoy life.

I think what really motivated me was the whole lifestyle mobile home investing supports. Once I made up my mind to pursue mobile home investing, it was very important for me to learn the system and stick with it. This is a very important key to success.

What I've learned is that it's better to do one thing very well rather than a lot of things and be mediocre. Most successful people out there are successful because they do one thing very well. For example, when we think of Johnny Depp - we think of him as an actor. He's very good at acting. Also, when we thing of Tim Burton - we think of him a a director. Both of them do one thing very well.

This can be applied when learning a system and investing in real estate. Many successful real estate investors I know are successful because they know a system very well. The reason they know it very well is because they stick with the system and do the same thing over and over again.

Many times new investors just starting out tell me they want to do so many things (i.e. mobile home investing, wholesale REOs, rehab, landlording, etc). These are all different systems which involve different skill sets and knowledge. Each system requires both time and money invested to do the work. If you split up your time trying to learn many systems, you won't have the same amount of time to devote your attention and energy as if you just tried to learn one system.

By learning one system and applying your knowledge to real life situations, you get better at what you do. I know what you're thinking, but how about the other deals that come my way? My answer is: I pass on them. Why? It's a much more efficient use of my time to focus on mobile home investing since I know it very well, than to go out and chase every type of deal that comes my way. Also, I always keep in mind why I decided to focus on mobile home investing above all the other real estate systems out there - it's the lifestyle. If I were to switch gears and learn a new system(s), I may not have the same lifestyle that I enjoy now with mobile home investing.

The great thing about America is that we have choices. I made my choice to learn mobile home investing and stick with it. I chose it because it fit my personality and the kind of lifestyle I want to live. Everyone is different and may have different goals. But, we all have a choice. Now, you can make your choice too.

I'm going to leave you here with a video from Seth Godin that inspired this post.

Happy Investing!

(If you enjoyed this post and would like to read more about the importance of business systems, I highly recommend this book. Great read!)



Video Link

Terminology Tuesday - Mold Growth, Assessment and Remediation

(Although this home suffered only minor exterior damage from Hurricane Katrina, small leaks and inadequate air flow permitted this mold infestation). Source: Wikipedia

As defined in Wikipedia:

"Causes and Growing Conditions
Molds and fungi are found everywhere inside and outside, and can grow on almost any substance when moisture is present. Molds when they reproduce make spores, which can be carried by air currents. When these spores land on a moist surface that is suitable for life, they begin to grow.

Assessment
The first step in an assessment is to determine if mold is present. This is done by visually examining the premises. If mold is growing and visible this helps determine the level of remediation that is necessary. If mold is actively growing and is visibly confirmed the need for sampling for specific species of mold is unnecessary.

Remediation
The first step in solving an indoor mold problem is stopping the source of moisture. Next is to remove the mold growth. Common remedies for small occurrences of mold include:
-Sunlight
-Ventilation
-Non-porous building materials
-Household cleansers"

Definition Link

When going out to inspect mobile homes, mold is very common in damp areas. The key is to assess the problem - stop the moisture from the affected area(s) and remove and kill the mold. Here is a short video:

(Note: If you're ever unsure about a particular mold issue, it's best to always seek out assistance and get an opinion from a professional mold remediation company).



Video Link

(If you're undecided about going out to do mobile home inspections yourself, check out this post).

Happy Investing!