Deal or No Deal: 3/2 Singlewide Mobile Home In a Park (Free Mobile Home)

Since I've received a lot of requests for more case studies, I thought I'd make up another post for "Deal or No Deal."

This one is for an early 1980s, 14x76 singlewide mobile home in one of the parks I like to work in. This opportunity actually found me while I had taken a trip to visit the park.

So, I was cruising the park just checking out the latest activity when I spotted the park manager walking around. He noticed me, I waved back, and said "Hey, what's going on?"

We chit chatted for awhile. And, we went for a walk around the park.

In any case, we talked about a lot of things. And, in conversation the park manager told me about a home the park had taken back. I learned this home had been vacant for months. And, the park just didn't want to fix it up and deal with it. He told me to take a look at it. And, if I were interested - the park would give it to me for free (based on his recommendation).

(Note: This is the power of networking and really having a strong team).

Now, I know there are folks out there who have heard of free mobile homes. And, I'm here to tell you - the term "You get what you pay for" usually holds true in these type situations.

The first thing I asked the park manager was, "Be straight with me. How much work does this thing really need?"

And, with that the park manager just smiled at me and said "I'll let you decide. Just take a look."

Once I heard that, I knew this probably needed a lot of work (aka a junker). I just knew it. But, I decided to go check it out anyways. And, here's what I found.

As soon as I pulled up to the home, I had a really bad feeling (through my "Does it Look Like a Deal" analysis).

Outside of home





Mold and flashing issues near top





Back of home with wood board covering up area of home (possible damage to paneling)



Hornet's nest near water heater panel

(Note: This is one sign the home is older (i.e. 1980s) when the water heater panel is accessible from the outside of the home. In most newer homes, the water heater panel is accessible on the inside (usually near the utility room or in the master bedroom).





Inside of home

Living room area



Ceiling (water) damage



Bucket of water underneath ceiling damage

(Note: I ran into the bucket while looking up at the ceiling and almost tipped it over - it was filled to the brim with water!)



Inside bedroom closet ceiling damage and mold issues






Bathroom floorwork needed



Insulation in tub



After viewing the home, the park manager asked what I thought. I said, "Seriously, did you think I'd even want this with all the work it needs? Even if you paid me, I wouldn't even want this!"

And, with that the park manager laughed. He told me he knew I wouldn't take it. But, just wanted to get my reaction. And, told me "Yeah, we all know that things that are free and cheap are not all what they turn out to be. We'll probably just sell it to an investor for a couple thousand dollars and they'll think it's a deal." And that was that.

I hope you enjoyed reading this case study of "Deal or No Deal." I hope it will help you to better understand the thought process when evaluating potential mobile home investments.

If you would like to share a story on a home you've recently passed on or pursued (aka "deal or no deal"), I'd definitely be interested in hearing about it!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Deal or No Deal: 3 Mobile Home Lots With 2 Mobile Homes

Since I've received a lot of requests for more case studies, I thought I'd make up another post for "Deal or No Deal."

This one is for 3 mobile home lots with 2 mobile homes. I got the call from a family who was a friend of someone I had spoken to awhile back.

(Note: Usually, when I talk to people for some reason they remember me. Maybe it's my demeanor and my laid back way of doing things. I get a lot of compliments from folks who tell me that I'm different from most investors - I come in more of a consultant than anything else. I always try to come up with solutions for folks - it doesen't always have to be working with me).

In any case, this family had run into quite a bind with their personal situation. One of the family members had been going to the hospital lately and they needed money to pay medical bills. So, they called me asking if I'd be interested in their lots and mobile homes. So, I decided to go and check it out.

(Note: Right now, I am looking into mobile home lots. It will be a nice addition. I guess I am following in Lonnie's footsteps - he also transitioned into mobile home lots from doing "Lonnie" deals. The good thing about the lots is that it's still the same concept - it's still like being the bank. And, I don't have to deal with the management issues involved with owning a park).

Since I took the time to learn my market, I was a bit familiar with this area. In fact, this area was where I did a mobile home move awhile back.

When I first drove into the neighborhood, I wasn't quite sure of it. It looked a bit shady. Some homes were kept up, some were not. It was not uniform all across the board. And, there were some homes with some really broken down cars. Not a good sign. It was a mix.

Shot of 3 lots with 2 mobile homes



So, the story was this family bought the 3 lots about 8 years ago as an investment. They bought the lots as raw land - there was no infrastructure on it. And, nothing on it either.

They installed an electric pole, but there was no water. They placed 2 mobile homes on the lots about 5 years ago with just the electric hooked up to one of them. As for the water, it cost too much to get a water tap and septic - they did not have the funds to do this.

So, they rented out the mobile home with the electric hookup to one of their daughters. Since this family lived down the street, the daughter and her family would drive down the street to their home if they needed to use water facilities. (Kind of crazy!) Thing is, their daughter and her family moved out about 6 months ago as they no longer could live there. They were paying this family $200 per month for usage of the mobile home. But, that stopped when they moved out.

And, the second home was never lived in. It was never hooked up as this family did not have the funds to hook it up. And, it was used as storage by another daughter.

(Note: Typically, I do not buy homes that have been vacant for years. If it has not been lived in awhile, there can be many issues that come up. One of the questions I always ask when visiting vacant properties, is how long has it been vacant. If it's recent, it's ok. If not, I'm extra careful and take the steps to make sure I know what I'm getting myself into).

In any case, when I first saw the homes I knew it wasn't anything I wanted to pursue. Basically, they looked like fixer uppers - too much work involved for me.

Mobile home #1 - 2 bedroom, 1 bath (used as storage for years)



Side of home



Mobile home #2 - 3 bedroom, 2 bath (electric but no water hook up, lived in by daughter and her family)



But, I did suggest to them that I knew a fellow investor who may be interested in taking a look. I told them he buys fixer uppers and moves them to his land. I told them this guy was ready to go - he had the mover and everything.

This family appreciated my help. I called up my fellow investor right there on the spot. He took my call, I handed my phone to the family and they made arrangements for him to come and see the homes.

(Note: I have a few fellow investors I work with on a regular basis. If I pass on a deal, I typically call them up based on their criteria and what they are looking for. If they end up buying, I am rewarded for my efforts. So, it's not a complete waste of time. My goal is to find solutions for these folks. And, sometimes I may not be the best solution).

As for the lots, they asked me if I'd be interested in them. I told them I'd have to think about it. I wasn't quite sure of the neighborhood. And, the fact that there was no water tap and septic concerned me. I've heard of this costing between $10,000-$20,000 - I've looked into it before.

I told the family it's best to try to sell these homes first to get some immediate cash. At first, they were trying to sell the homes with the lots but kept getting folks interested in owner financing who they thought were a bit shady. I told them it's the homes here that attract those kind of people. If they were to fix up the homes, maybe they'd get a higher type of clientele willing to pay cash. But, that would take time and money - a route they did not want to take.

In any case, they thanked me. They told me if I'm interested in the lots, they'd be willing to owner finance them and sell to me at or below cost.

To me, that wasn't the issue. It was the neighborhood and putting in the proper infrastructure. Plus, I'd have to go find nice homes to place them on. I just wasn't sure if I wanted to spend all this time and effort on this one deal - was it worth it? Or, maybe I'd pass and spend my time on something ready to go. I'm still thinking about it.

I hope you enjoyed reading this case study of "Deal or No Deal." I hope it will help you to better understand the thought process when evaluating potential mobile home investments.

If you would like to share a story on a home you've recently passed on or pursued (aka "deal or no deal"), I'd definitely be interested in hearing about it!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Does It Look Like a Deal?: 2/1 Mobile Home In a Park

Since I receive a lot of requests for more case studies, I thought I'd make another post for "Does It Look a Deal?"

(Note: While the "Deal or No Deal" case study series focuses on the mechanics of my thought process of evaluating mobile homes from beginning to end, this new case study series, "Does it Look Like a Deal," will focus more on a quick outside evaluation of mobile homes - I use this evaluation to prioritize the leads I pursue."

This lead came from a park manager in conversation while we were sitting in the office having coffee and donuts. (Guess who brought the coffee and donuts?)

(Note: What has worked for me with park managers is spending a lot of time with a select few I enjoy working with in nice, family style parks. For me, quality is more important that quantity. I don't mind spending a whole morning or afternoon with one park manager - it's building the relationship that counts. I see so many investors out there who try to "network" with everyone only to create mediocre relationships. For me, I've learned it's better to create a few really strong relationships than a lot of mediocre ones. Again, this is just my experience).

In any case, I learned from the park manager that this home was abandoned and taken back by the park. The park wanted to get rid of it.

They were trying to sell the home for $2500. But, the park manager told me I could have it if I just wanted to fix it up and start paying lot rent in a few months.

(Note: Now, some people may get excited about getting "free" homes in this business. But, for me "free" homes really mean expensive homes because most of these homes need a lot of work and take a lot of time to fix up. Though some have tackled these types of opportunities and have been successful at it, just by looking at the outside of the home I knew this was not my type of deal. For me personally, I'd rather spend my time on a home that needs less fix up and conforms to what the types of people I work with (usually families) are looking for (i.e. larger homes) that I know I can stand behind (i.e. support my product, know it's a good home) than something that needs a lot of fix-up work that is smaller and not really sure if I'd live in myself. Again, it's very important for me personally to be able to stand behind my product. If I cannot see myself living in the home (as well as living in the park), then I pass on the deal).

I "thanked" the park manager for letting me know about this opportunity. I told the park manager just from looking at the outside, it just really wasn't my kind of deal. The park manager understood - said someone could make something out of this but the park wasn't willing to give it away to just anyone, it had to be someone they knew and trusted to make it work.

So, as I write this the home is still sitting there in the park. No one really knows it's for sale as there is no "For Sale" sign. Again, most of the deals I work are "inside deals." In my experience, the key to being successful in this business is getting to the deals before everyone knows about them. And, that can only be done by building strong relationships. In the end, it's quality not quantity that counts.

Happy investing!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Deal or No Deal: 2/2 Singlewide Mobile Home In a Park

Since I've received a lot of requests for more case studies, I thought I'd make up another post for "Deal or No Deal."

This one is an early 1980s, 14x76, singlewide mobile home in one of the parks (high end) I prefer working in. The sellers had called and found me through a friend living in the park - they said they've heard what I do and asked me to check this one out.

(Note: In the beginning, I had to do a lot of marketing and networking to get the word out on what I do. My style is to be as personable as possible - I don't try to act as a big whig. I guess I follow Lonnie's style of just being a small operation - it's worked for me. Again, everyone will have their own style of doing things).

When I received the call and heard the sellers' story on why they were moving, I had a bad feeling. Basically, they told me they needed to leave because they just couldn't live in the house anymore - there was too much work that needed to be done to fix up the home.

They had been living in it for 5 years. Though, they've had so many issues with it - the central a/c had just broken down and the water heater was going to need to be replaced soon. These were just a couple of things mentioned.

(Note: When I hear the words, "We can't live in this house anymore," it's a major red flag to me. I've had so many cases where I've had these types of calls - most of these types of calls always require the home needing a lot of work and to be fixed up a great deal).

Since the home was in a park (high end) that I prefer, I decided to go ahead and make a trip out to inspect the home. Here's what I found:

Outside of home

Mold and flashing issues near top

(Note: The gutters had not been cleaned out for a very long time. Also, the roof had not been re-sealed since the sellers bought the home 5 years ago. There are signs of water damage on the outside as well as the inside of the home).



Back of home



Side of home

More flashing issues and water damage to masonite hardboard siding



(Note: If you notice lines of water stains (as in the pic below) down the siding of the home, it's indication of flashing and water damage issues. For this home, it was apparent around the entire outside of the house).











From the outside alone, I knew there was going to be a lot of work needed to be done. Since there was a lot of water damage to the outside masonite hardboard siding (due to flashing, roofing and gutter issues), the outside alone would require a lot of work to replace the rotted and damaged areas especially since it was all around the entire home).

Inside of home

Living room



Kitchen





Hallway

(Note: There were some soft spots in the floor in the hallway - this had never been replaced by the sellers).



Bathroom floor

(Note: Some parts of the existing floor had collapsed. The sellers had started to remove remove and repair some of the areas. However, they did not finish as it required too much work and money).



Underneath bathroom sink

(Note: The baseboard had collapsed due to water damage - this was not repaired).


(Note: There were also signs of water damage in the bathroom above the shower. The picture did not turn out well, so I'm unable to include it here. Though, rings of water stains on the ceiling are usually indications of water damage and issues with the home).

Window a/c unit

(Central a/c had broken down - it was the original to the home).

(Note: While not always a deal killer, I've found it much more difficult to sell homes in high end parks that do not have central heat and air. In most cases, buyers who are looking in high end parks prefer homes with this feature).



After a thorough inspection of the home, I decided to pass on this deal. Why?

For me, it was too big of a risk for the time and money involved to fix up the home. It had a lot of factors going against it to meet my criteria. Not only did the outside of the home need a lot of work, but the inside as well.

(Note: When I asked the sellers the condition of the home when they bought it 5 years ago, they told me it was a major fixer upper. The previous owner had not taken good care of the home either. And, these sellers told me they had to make a decision (due to money issues) to either fix up the outside or the inside of the home - they could not do both. So, they decided to put their money into fixing up the inside of the home. But, they were unable to finish due to money issues).

Also, the fact that it was an older home and a 2/2 without working central heat and air would be a challenge with the type of clientele I tend to work with. In my experience, the types of clientele I tend to deal with prefer homes to be fixed up with central heat and air, as well as a preference for 3/2s.

So, I passed this lead onto a fellow investor who specializes in buying fixer upper type homes and specializing in 2 bedrooms and smaller homes .

Since this fellow investor bought mostly fixer upper type homes and worked with folks looking for smaller homes, I saw it as a better fit. Plus, it would be a better use of my time to pursue other deals that better fit my criteria.

(Note: Some investors think competition is a bad thing. I'm here to say, it's actually a good thing. Everyone has their own criteria on what makes a deal. A deal to me may not be a deal to you. And, vice versa. By knowing other investors in the business, you open yourself up to more opportunities).

Though this was not a deal for me, it was a possible deal for my fellow investor. And, everyone has their own criteria on what makes a deal. For me, this one just didn't fit mine.

(Note: After telling the sellers I had decided to pass on this one, I did refer them to my fellow investor - they appreciated that. Though, they told me they really had wanted to sell to me as they liked and trusted me. They even dropped the price down to $2700 (they started at $5500) but told me they'd be negotiable with me even on that price as they were already packing - they had already found another home in another park. I "thanked them" for their kind words, I told them the fellow investor I referred this to works these kinds of homes all the time and I thought it would be a better fit. The sellers thanked me and appreciated the referral. It's always good to be able to come up with solutions for folks. Not every lead will turn out to be a deal, but I always make it a point to help others and figure out solutions to their problems).

I hope you enjoyed reading this case study of "Deal or No Deal." I hope it will help you to better understand the thought process when evaluating potential mobile home investments.

If you would like to share a story on a home you've recently passed on or pursued (aka "deal or no deal"), I'd definitely be interested in hearing about it!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Does it Look Like a Deal?: 2/1 Mobile Home In a Park

With the popularity of the "Deal or No Deal" case study series, I thought I'd start a new one here.

While the "Deal or No Deal" case study series focuses on the mechanics of my thought process of evaluating mobile homes from beginning to end, this new case study series, "Does it Look Like a Deal," will focus more on a quick outside evaluation of mobile homes - I use this evaluation to prioritize the leads I pursue.

When I first hear of a home for sale, I evaluate 2 things. First, the park. And, second - the home itself.

If the home is in a park that I'd live in myself and feel comfortable working in, then it passes the first test.

(Note: I've mentioned before I only work in high end parks now due to this situation. For me, it's all a matter of comfort level - I prefer high end parks due to the type of clientele it attracts. Figuring out which parks you choose to work in will depend on your personality and comfort level).

Second, I evaluate the home by doing a drive by.

(Note: This is where me and Lonnie differ. When a lead comes in from the park manager while in the park, Lonnie goes to the home and meets with the seller that day. For me, I like to do a drive by of the outside to see if it's even a home I'm interested in pursuing - I don't buy every home that comes up available, even if it's cheap).

Now, most of the homes I pursue have a certain look - they are usually bigger and newer compared to the traditional "Lonnie" deal. Why is this?

For me, I tend to evaluate these homes more from a homeowner type of mentality and the type of clientele I usually work with. I have to ask myself, "Would I (my clientele included) live in this home?"

My thought process is that if it's not a home that I would live in (see the value in), then why would someone else? There's an old saying that if you don't stand behind your product and believe in it, then it's going to be really hard to sell it to others.

Just by looking at the outside of a home, I can tell whether or not I want to pursue an opportunity. I use the drive by method to prioritize which homes will take priority and use of my time. I don't want to put all my time and effort into a home I really don't think I can sell to the type of clientele I usually work with despite the price - I've been down that road before. For me, cheap doesen't necessarily mean better especially when working in high end parks.

(Note: This is just my experience and preference of doing things. I'm sure some have had different experiences. This is just what has worked for me).

In any case, this lead (see pic above) came in from a park manager while I was at my favorite park (a plus!). The park manager told me the seller had just come in a few days ago to let him know that the home is for sale.

(Note: Usually, when a seller in a park decides to sell their home they must notify the park manager. Having a good relationship with park managers is key to success in this business).

The park manager told me the home is a 2 bedroom, 1 bath older style home. Though, it was originally a 1 bedroom - it was converted to a 2 bedroom. When I heard this, I became leary. Usually, I do not like homes that have had any type of conversion.

Moving along, the park manager went on to tell me the owner was asking $9500 for the home.

Now, I've said this before - the asking price does not matter. It really doesen't because everything can be negotiated.

I see a lot of folks out there who look for deals based on asking price. In most of the deals that I've worked, the seller had started at retail price. It was only through negotiating and really building rapport with the seller (aka earning trust) where I was able to negotiate win/win situations.

To some, $9500 on a home is too much. For me, $9500 on a home would be a great price for the type of home I usually buy. Again, it's very important to learn your market. Without knowing your market, it's going to be really difficult to evaluate opportunities.

In any case, after doing a drive by of the home I knew this was not something I wanted to pursue. It just didn't fit the "look" of the types of homes I buy. So, I told the park manager I'm not really interested in this one.

(Note: Remember, there are so many homes to choose from - it's a buyers market especially in this economy. The sellers have to sell but you don't necessarily have to buy).

After talking again with the park manager, I was made aware of another opportunity. This one was due to a divorce situation. The park manager said it's a bigger home, newer, and something maybe worth looking into. Here's a pic:



After doing a drive by, I knew right away this was a home I wanted to pursue. I am currently waiting for the park manager to set up a meeting as the seller is still finalizing their divorce situation.

(Note: Notice none of these pics have "For Sale By Owner" signs. That's because most deals I've found are insider deals - these sellers just don't want to take the time to have so many people go through their homes. Most times, they'd rather work with the park manager to help them find a buyer - this is where I come in).

I hope this has helped to show you the process I use of evaluating and prioritizing the homes I pursue based on a quick outside drive by evaluation.

When it boils down to it, I only pursue opportunities that I feel comfortable working with. Again, it's all a matter of comfort level and personality.

Happy investing!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Update: 3/2 Singlewide Mobile Home In a Park (Bank Owned)

Thought I'd give everyone an update on the mobile home I mentioned in this post - I've been in negotiations with the bank on this one.

So, I got all my numbers together on the fix up work needed to bring this home in marketable condition. And, I presented my offer to the bank. Here's what I came up with:

$1800 - condenser air conditioning unit (none there)
$1325 - carpet, padding and tack stripping (carpet gone in all rooms including hallway)
$776 - skirting (skirting gone)
$783 - front porch to be built on site to park specifications (none there)
$297 - back porch to be built on site to park specifications (none there)

$4981 - total fix up work

(Note: This is why it's important to build a team. With just a quick phone call, I can call up my contractors and they can estimate for me what these items would cost).

In addition, I made it a stipulation that the taxes must be paid and brought current (there were around $500+ in back taxes owed) as well as the lot rent (2 months back lot rent - $1000+).

Along with my offer, I also noted that the home will stay in the park if my offer is accepted.

(Note: Per the bank rep, I was advised my offer had a better chance of being accepted if the home were to stay in the park).

So, how did I come up with my offer?

Well, going into it I already knew the market. I knew a home like this would sell owner finance around the mid 20k-high 20k range. I knew the down payment amount would probably be around $2500 and cash flowing in the $500-$600/month range.

Based on these numbers, I knew the most I could get myself into this (total) would be around 13k. I worked backwards based on the fix up work needed. So, I came up with an offer of 6k.

(Note. When negotiating and making offers, you always want to give yourself some room to negotiate. Most times, I go in with a lower offer than my maximum allowable offer. Then, I expect some countering back. If I can arrive close or at my maximum allowable offer, then I'm able to make the deal work).

When I presented my offer to the bank, I justified my offer to the bank rep. I told the bank rep there's just no way I could go higher with all the things missing that the home needed. The bank rep understood and told me it's actually a decent offer.

Furthermore, I told the rep I'd be willing to up my offer if the bank were able to provide all of the items or some of the items needed. I told the rep my main concern was the missing a/c condenser unit and the front porch, which are very big ticket items. If the bank were able to provide these items, then I'd be willing to up my offer.

Though, when I said this the bank rep responded with a "Uhhh, we don't do that kind of stuff. We're just trying to sell this thing "as-is." But, I was trying to be the good investor so that I could give them options. And, the bank rep told me it was much appreciated as most investors they run into just give them really low ball offers with no justification whatsoever.

In any case, the bank is mulling over my offer on this one. So, we'll see.

(Note: I don't really spend all that much time with the banks. Usually, the homes that I pursue with the banks are only those that are pointed out to my by the park managers in my favorite parks. For this one, the park manager told me about it as the eviction took place 2 months ago - it had not even made the bank's distribution list of homes taken back yet).

I hope this example will help give you a better idea on how I go about negotiating and making offers.

Speaking of negotiating, I've been in negotiations on quite a number of other mobile homes. This time of the year (spring and summer) is one of the best times to find both sellers and buyers - people are moving out as well as moving in.

To give you an idea, here are a couple of other things I'm working on:

3/2 Singlewide In a Park, 16x80



3/4 of an acre mobile home lot with 2 mobile homes





2/2 Singlewide In a Park, 14x76



These are just a couple as there are quite a number of them with the time of the year and all. Though, I will continue with the updates along with the case studies since many have said they have enjoyed reading them.

Happy investing!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Done Deal: 4/2 Singlewide Mobile Home In a Park

Since I've received a lot of requests for more case studies, I thought I'd make a post on another one I closed on recently.

(Note: This mobile home is very similar to this deal with the same title. The only difference is that it's a few years older. But, it does have the same specs).

This one was referred to me by the park manager in one of my favorite parks.

(Note: When first starting out, you'll find there are parks you like and parks you don't like. It's all a matter of personality and your comfort level. For me, I prefer high end parks due to this experience - it's just my comfort level. I enjoy working in high end parks because of the clientele - I find it attracts the types of people I feel comfortable working with. Again, it's all a matter of personality and what works for you).

The park manager told me the seller had been trying to sell this one for 2 months. I had just found out about the deal as I had returned from a trip. So, it was already 2 months into the sales process when I started working on it.

So, I decided to check it out and met up with the seller. On my first visit, I learned the seller had already moved out of the home - it was vacant. The seller had bought a new home out on land about 2 months ago. For two months, the home had been vacant.

When I went around and inspected the home, I found it matched my buying criteria. Usually, I will only take on homes that have cosmetic issues and not much fix up work - no major rehabs for me. As long as all the major systems are in working order and the structure is solid, I'll take it on.

If there are issues with the roof (i.e. major ceiling leaks) or with the major systems in the home - it's too much for my criteria. I look for homes that don't need much work that don't take too much time to fix up.

(Note: Since I work in high end parks, the lot rent fees are higher than low end parks and can add up. This is why I need something in pretty much move in condition so I can get it on the market and get it sold fast).

Looking through the home, it just looked like it needed a major cleaning and a bit of touch up work. In high end parks, most buyers look for quality - not cheapness. Especially in this economy, it truly is a buyers market.

After looking around the home, I asked the seller how things were going with the sales process. He told me he had a few buyers go through the home. There was one family in particular who was really interested.

Though, he told me he wasn't sure if they had the funds to buy the home. They had asked him if he was willing to owner finance to them. Though, the seller told me this was not an option for him because he wanted to cash out and not deal with this home anymore.

If he were to seller finance, then he would still be tied to the property - he wanted to cut off all ties. Plus, the seller told me since he lived further out now he didn't want to deal with this home and the issues that would come up if the buyers didn't pay and he had to take the home back.

After talking for a bit, the seller asked me what I thought. He told me the park manager told him that I may be able to help him out.

(Note: Since I've been in the business for awhile and have gained a good reputation, it's the park managers that are my cheerleaders - they are the ones selling and promoting me. Most times, I end up being more of a consultant to sellers than anything. When meeting with sellers, I don't try to buy the home out right unless I see it as a good fit - it must be a win/win situation for both me and the seller. The deal must match the seller's needs as well as mine).

I told him there are a couple of problems here - the home needs to be properly staged. First, the condition of the home. I told him the home really needs to be staged well - it needed a good cleaning and a bit of touch up work. The floors, walls, ceilings - they were all dirty.

In order for this home to sell and attract the right kind of buyers, I told him he would need to really give the carpet a good cleaning - there were patches of stains throughout. I suggested a home cleaner if he didn't want to spend the money for a professional carpet cleaning company.

Then, I told him it would really need to be cleaned inside and out. I highly suggested using a professional cleaning company if he didn't want to do the work. I also suggested he may want to re-paint some of the areas of the home as it needed a bit of touch up.

After going over the inside of the home, I talked about the outside. I told him he would need to sweep the porch and do a bit of landscaping outside. Maybe he wanted to re-mulch around the house and plant some nice flowers. I reminded him the outside is the most important as it's the first thing people see when they drive by. If the home does not have curb appeal, then in most cases people will not take the time to look at the inside.

As I explained to the seller about the things that needed to be done to fix up the home, I could see the seller getting overwhelmed. Since I do this on a regular basis, I know what the majority of buyers are looking for - they want a nice home.

Most buyers (i.e. homeowners) do not want to buy a home that needs work. They want everything all fixed up. And, especially in this economy - it's a buyers market.

Since I work in high end parks, I rarely sell homes "as-is." The homes I sell have to be in pristine condition - it's just what the types of buyers in these parks attract. It's extremely difficult to sell a home in high end parks in "as-is" condition and command retail price - it's just not going to happen.

After giving my input to the seller, I asked the seller what he wanted to do. I told him if he wanted to work with me, I could buy the home but I wouldn't be able to meet the price he was asking for. I told him with the fix up work needed and since this was a cash deal, it would have to be less.

(Note: When he first put the home on the market, it was listed for 30k. When I got into the deal, he was at 25k).

The seller told me at this point he was open to the possibility of working with me. I asked him if I could get some estimates from my contractors on the costs of some of the fix up work, would he be willing to negotiate the price?

He said, "Yes." He told me he would like that and would like me to show him the estimates. So, I agreed to get the estimates and we agreed to meet again in a few weeks.

(Note: Typically, when I'm working deals I don't rush things unless the sellers are truly motivated. If they are semi-motivated, I give it some time in between meetings to let them mull things over. I find that time has a way of increasing motivation).

After a couple weeks, we met again with the estimates. The seller looked it over as I explained each item in detail. He said he understood the home needs work. And, he told me he didn't want to do the work himself.

After going over the estimates and the fix up work needed, I asked the seller what his best cash price would be. Then, I was silent. At this point, he told me he'd take 21k for the home. Then, I asked him - is that the best you could do?

(Note: Going into the deal, I already knew the market. I knew a home like this would sell in the low 30k range owner financed).

Then, he went down to 18k. And, then asked me what I'd be willing to take the home for. I told him 14k cash with a quick closing.

At this point, he said he would have to think it over. He said he really wanted to get more than that. I backed off and said, maybe he should continue showing the home and see what happens. But, he said he didn't want to leave things up to chance. So, we agreed to meet again in a couple weeks.

After a few more weeks go by, we met again. This time I asked him what he thought. He told me he'd take 17k for the home. I told him I still think that's a bit too much for me. I asked him if we could meet halfway. He asked, "You mean, between your 14k and my 17k?" I said, "Yes."

He then said, "How about 16k?" Then, I said "Well, that sounds good but it's still a bit more than I was willing to spend." I think I could go for 15k. Then, he said "Really 16k is my bottom line price." So, I said "How about 15k and you take the outside shed?"

(Note: Many times there will be an outside shed that goes with the home. It's nice to have but is not a major selling point (in my opinion). Really, it's the home and the type of park that really makes a difference to most buyers).

He was a bit surprised with my counter offer. He told me he thought he needed to include the shed with the home. I told him, "No, really I don't really need that - it's not a requirement for me." Then, I reminded him having a shed would actually be good for him since he could have a place to store some of his items. He told me, "He never thought of that."

So, he agreed. And, that was that.

To make a long story short, I bought a mid 1990s mobile home, 16x80 with 4 bedrooms and 2 baths for 15k in a high end park. I sold the home to a family who had relatives already living in the park - I received $2500 down and it cash flows in the $500/month range for 10 years.

Though this deal took a bit of time and negotiating back and forth, all my hard work paid off. It made for another nice and relaxing cash flow payday for many years to come.

Happy investing!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!

Deal or No Deal: 2/2 Singlewide Mobile Home On Land

Since I've received a lot of requests for more case studies, I thought I'd make up another post for "Deal or No Deal."

This one is an early 1990s, 14x60, singlewide mobile home. I found this one through an ad on craigslist.

(Note: I don't really use craigslist a lot. Most of the deals I find are a direct result of my network. Though, I do check it once in awhile to see what's out there. So far, I've only found one deal through craigslist).

Basically, the sellers (who were a husband and wife) had initially purchased this home for themselves and moved it to their land. However, when they got it to their land they did not account for the hookups which ended up costing too much money for them.

Though they were able to afford the move, putting in a septic and water system would have cost them $6800 and $3800 respectively. What had happened was that they thought they already had the infrastructure on their land. However, when they looked into it after the move they found out that it was not within their boundaries - the water system was on someone else's land.

(Note: These sellers had this land for many years - nothing was on it. They had bought the land years ago and planned to use it sometime down the road. Up to this point, it had been empty).

When I spoke to the sellers over the phone, they told me specifically that the home needed to be moved off their land. So, whoever ends up buying it needs a place to move it.

Being in the business, I already have a couple parks to work with for these types of situations. Though each park does have their specifications on what they allow and don't allow into their parks.

(Note: Some people have asked me about getting free lot rent from parks. Some parks will allow you free lot rent for a few months or even longer. Though, most of these parks tend to be more lower end type parks. It's really up to you and your comfort level on the types of parks you want to work in. For me, I'm more comfortable with high end parks (due to this experience) - that's just my personality).

The park I had in mind was more a high end park - hey had already agreed to work with me to fill in their vacant lots and help pay for the move. Though, they would have the authority to approve/disapprove what comes in.

So, I went ahead and made a trip out to inspect the home. Here are a couple of pics:

Outside of home







Rotted siding issues due to no flashing





Inside of home

Living room







Kitchen





Bedroom 1



Bedroom 2



Bathroom





Utility area



Hallway



Overall, the home was in fairly good condition - it looked very well kept. Since it was not hooked up, I could not test the water and the electricity - I had to rely on the sellers feedback and my "gut feeling."

(Note: For me, it's less of a risk if I can test out all the systems in the house to make sure they work (i.e. electricity, water, etc). If one and/or all of the systems cannot be tested, there's a possibility there may be some unknown issues that will come up in the future once everything has been hooked up. I found this out through one of my experiences moving a mobile home. I was able to test out the electricity but not the water (since it wasn't on) - I had a 50/50 chance that at least the electricity worked. Though, when the home arrived at the new site I faced some plumbing issues with the home - it cost a bit of time and money. Lesson learned: It's best to be able to test out all systems if you can).

After assessing the pros and cons, I decided to pass on this deal. Why?

For me, it was just too big of a risk. It had a couple of factors going against it for my own criteria. First, it was a 2/2. Usually, the buyers that I work with prefer a 3/2 and larger. So, I knew this would sit on the market longer. Second, I could not test out any of the systems in the home. For me, this was a big risk especially since it was on a piece of land and needed to be moved. Lastly, it had to be moved. The amount of time and money for a 2/2 for me that needed to be moved that I could not check the systems in the home to make sure they worked was just too much.

So, I passed this lead on to a fellow investor. This investor actually works the same park as I do. Though, specializes in 2 bedrooms and smaller homes which are usually moved from a piece of land into the park.

Since this fellow investor already worked with a market for those looking for 2/2 homes, I saw it as a better fit. Plus, it would be a better use of my time to pursue other deals that better fit my criteria.

(Note: Some investors think competition is a bad thing. I'm here to say, it's actually a good thing. Everyone has their own criteria on what makes a deal. A deal to me may not be a deal to you. And, vice versa. By knowing other investors in the business, you open yourself up to more opportunities).

Though this was not a deal for me, it was a possible deal for my fellow investor. And, everyone has their own criteria on what makes a deal. For me, this one just didn't fit mine.

I hope you enjoyed reading this case study of "Deal or No Deal. I hope it will help you to better understand the thought process when evaluating potential mobile home investments.

If you would like to share a story on a home you've recently passed on or pursued (aka "deal or no deal"), I'd definitely be interested in hearing about it!

p.s. Feel free to leave comments on any post either here and/or my Facebook Page. Comments are always welcome, thanks for reading!