Mobile Home Rentals:

Mobile Home Rentals: Earn 20% + Returns Per Year

A series of events has caused a large amount of mobile home foreclosure. Anyone living in, or near a state where manufactured houses have a high foreclosure rate can make great returns from the situation. This idea is based on you having cash, I am sure some creative financing can be done that would enhance the rate of return.

In Texas a law was passed changing the way these homes are financed which hurt the industries sales. Plus low interest rates, which make traditional homes more financially attractive when compared to manufactured homes. The result is that you have more re-possessed mobile homes on the market then the market can absorb. Then Finance companies have to auction the homes off at a loss. Eventually this situation will correct it's self; in the mean time there is money to be made. The situation of available Mobile homes is similar in many states.

You can buy (for cash) single wide mobile homes for as little as $6000 up to $12,000 and double wide units from $9,000 to $20,000. You can locate the homes for sale by running ads, putting up signs, driving around the mobile home parks, talking with the park managers so they know you are buying and can pass the word along.

What you can do is:

Locate lots (property) where mobile homes are allowed and purchase a used home and set it up on the lot. You can rent the home out, or sell it and carry the note, (depending on your situation). Lots are available in mobile home sub divisions and parks, and some towns allow mobile homes on residential lots. Check and be certain that what you propose to do is allowed before you rent or buy either the lots, or before you buy the homes.

Look for lots were the utilities are in place and were you will have the least amount of set up expense. Keep lot rental cost to $150 per month or less or buy them for between $6,000 and $10,000. Buy a mobile home and place it on the lot, your total cost needs to be under $30,000.

The numbers:

If you rent the home out at a monthly rental of $700 and your taxes and maintenance cost you $200 to $300 per month, you will net $400 to $500 per month. If at the high end you spent $30,000 and get net $500 per month, the unit will pay for its self in five years. After five years, the rent is all profit. If you raise the rent to $750 after one year and to $800 after two years you get all your money back in four years. Then it is all profit.

Or you could sell the home and carry the note. Say you sold it for $50,000 and carried the note at 10% interest for fifteen years, that would be $537.00 per month principal and interest. Your $30,000 would bring you $96,660 over the next fifteen years.

What I have heard:

I have located one mobile home park owner who is buying used mobile and renting them out, he is averaging a three year pay back because he has the land already.

I have seen some people accumulating the units in a storage fields. They are either holding them for re-sale, or holding them while they locate property to put the units on.Â

I met a man (a car salesmen) who bought the use mobiles and left them on the land where they were when he purchased them until he could get them sold, he said he had to get a dealers license but he was making a few thousand extra every month for his part time sales business. He used a credit card to buy them and classified ads to sell them. I asked why he used a credit card check to buy the units and he replied. There is nothing like a big bill coming in to motivate you to get it sold quick.

I with a retied fella in San Antonio, Texas who had twenty two rental mobile home units and he said he had a two year pay back. because he rented the lots rather then owning them and he bought only smaller single wide units. (less exspensive to move and repair) His average rental was $600 per month. His net income was at $8,800 per month, he said he started part time, started with only $3,000 seven years
earlier. He had not had a real job in four years.