Every year thousands of property investors are seeking out new investment opportunities to add to their portfolios. Strangely though, many fail to see the significance and advantages of investing in mobile home parks. Instead they go for the “usual” investments of regular homes and apartments.
Savvy investors should always be looking for the very best opportunities out there to realize a positive ROI, so in this article we’ll take a look at a few key reasons why investing in mobile home parks is the way to go.
Why Mobile Home Parks Are a Popular Choice for Tenants
One of the main reasons investors should be looking at mobile home parks is because of their continued rise in popularity. As more and more Americans choose to simplify their living and downsize their homes, mobile homes have become a very attractive alternative option.
People are looking to get out from under expensive mortgages, free up their finances, and are also looking for smaller houses that are far easier to clean and maintain.
Mobile home parks also offer a greater deal of security and stability, along with a sense of residents belonging to a like minded, close knit community.
First home buyers and those people who can’t afford to pay off a bigger, more expensive house, are buying homes in mobile home parks.
How does that relate to you as an investor?
Well, whether the resident owns their own home or not inside the park, they don’t own the lot. The park owners charge monthly rent on each lot of land allocated within the park. Owners also charge rent on any mobile homes that the park actually owns.
Therefore, you have two potential ways of collecting rent. Rent is paid on all of the lots as well as some of the homes.
It’s just another reason why investing your money in a mobile home park makes perfect sense from a financial point of view.
Professional Management Teams Run the Park for You
Park owners don’t have to be hands on in their investments, as there are many professional mobile home park management teams out there. Companies like Sierra Corporate Management is one such
company that specializes in the management of mobile home parks for their owners.
The management team looks after the entire running of the park. This includes showing homes to potential new residents, putting together lease agreements, collecting the rent each month, chasing up late rent, cleaning and maintenance of the park, looking after all the facilities, and simply dealing with the park residents on a daily basis.
As an investor, you can let management look after all your affairs so you’re free to focus on other pursuits, confident in the knowledge that rent money will be flooding into your account each month.
Mobile Home Parks Are a Low Risk Investment
When you invest in one expensive regular home, if you can’t rent it out for an extended period of time, then it’s really a dead investment that’s proving to be a money pit rather than profitable.
It’s an entirely different story when you buy into a mobile home park though.
Let’s say the park you buy has 200 lots on it. That’s 200 people paying the rent when the park is at capacity, and even when there are a few vacancies, you still have so many other residents paying you rent each month.
In other words, the risk is spread really thin across the entire park, so any time there are a few vacancies, your cash flow is barely affected at all.
That’s the kind of scenario all property investors should be on the lookout for.
Low Tenant Turnover & Low Maintenance
These are two very key features of modern mobile home parks. Because downsizing and living in mobile homes is in such high demand, you’ll rarely have to deal with a lot of turnover in a mobile home park. Once people are in they’ll want to stay.
Mobile home parks are also pretty low maintenance, so even with a management team looking after the park on your behalf, you won’t be spending copious amounts of your budget dollars on park upkeep.
Investing in mobile home parks is really a no brainer.