Commercial property investment naturally leads to a diverse portfolio of assets. However, as you expand your business, you may consider investing in a mobile home park.
Mobile homes facilities may not have the same appeal of an emergent industry, but they have definite appeal to savvy investors. To help you make your decision, here are a few things to consider about mobile home park ownership:
Cost-benefit perks of park ownership
Depending on the circumstances of the park you are evaluating, it may have low overhead costs, making for favorable revenue potential. As such, you may find that the return on investment of owning a mobile home park is appealing.
In many cases, the residents own the homes themselves. Meanwhile, the land on which the mobile homes exist would belong to you.
At first, this split ownership may sound unwelcome, since you would not own all the structures. However, there is also an upside to this arrangement: Depending on the stipulations in the lease contracts and other factors, such an agreement could result in decreased maintenance costs.
Responsibility division in park ownership
When the residents own their home’s structure, they are typically responsible for all upkeep related to the building itself. Roofing, siding, porch light bulbs and other things attached to the building are up to the tenant to correct.
Your responsibilities will include any communal property, such as recreational buildings and park roads. As for the care of the lot a tenant occupies (mowing, landscaping, snowplowing and so on), whether you or the tenant will be responsible depends on the lease agreement. In some cases, you may want to include lot maintenance costs in the rent so your company can handle it, as this can facilitate consistent curb appeal throughout your park.
Get the right information
As with any investment, there are possible pitfalls. Before making any decision, you should always discuss things with all stakeholders and an attorney with extensive commercial property experience. Armed with the right knowledge and support, the problems you may encounter do not have to inhibit your decision to own a mobile home park.