Should I Invest In Mobile Homes?
According to John Fedro, an active mobile home investor, if you go this route you will be talking to motivated mobile home buyers and sellers who own all sizes of mobile homes and manufactured homes. Some of these mobile homes will be considered singlewides, and others will be considered doublewides. Whether singlewide or doublewide, both of these sizes of mobile homes may be very profitable and in high demand by local buyers.
Singlewide mobile homes are built no bigger than 18 feet wide and 90 feet long. Doublewide mobile homes on average are less than 40 feet wide and less than 90 feet long.
Through what research is available online, there seems to be more singlewide mobile homes in existence than doublewide homes — by a ratio of 3:1 in many areas. Likewise, there seem to be more 2-bedroom singlewides compared to 3-bedroom singlewides.
Disclaimer: The terms “mobile home” and “manufactured home” are being used interchangeably in this article. This is common not only throughout this article but throughout the real world with regard to mobile home investing. In reality, the term “manufactured home” is the verbiage used to describe most factory built housing constructed after 1976.
Demand changes as the purchasing opportunity changes. Larger cities may have more buying demand compared to smaller cities simply due to the increased number of people nearby looking for a new/used affordable home. Depending on whether you are selling this investment mobile home to an end user via an all cash sale or via monthly payments, the demand from buyers will change in most areas from singlewide to doublewide. Here’s how.
- Selling via All-Cash or Bank Financing: When selling a mobile home to an all-cash buyer or a bank financed buyer, you will be competing against many other mobile home sellers in the area also looking for an all-cash sale. If your mobile home is prettier and larger than the competition, your home will typically be purchased first, assuming the price is comparable. In short, doublewides are more popular with a cash or bank-financed buyers. Bigger = Better.
- Selling via Monthly Payments: With regard to selling used mobile homes via monthly payments, there is little difference with the purchasing demand from buyers when you are selling a singlewide mobile home versus a doublewide mobile home. The reason for this is simple — the attractiveness of the seller financing supersedes the need for a slightly more spacious home from buyers. In short, doublewides and singlewides are nearly equally popular when selling via monthly payments.
Doublewide manufactured homes typically have double the square feet as compared to singlewide mobile homes. This means that there may be double the amount of rehabs needed with a doublewide mobile home versus a singlewide mobile home. The floor and roof of mobile homes are two costly areas to repair, so look for water stains, leaks, and damages.
Singlewide mobile homes will typically cost less than half the amount to move and set up compared to a doublewide mobile home. Singlewide mobile homes will be moved as one complete unit in most cases, whereas doublewide mobile homes are typically transported in two separate halves once separated. These two halves must then be joined/reconnected at the home’s new location.
Pro Tip: Always, always, always hire a mobile home transporting company that comes with high recommendations and referrals. Ask local mobile home park managers who they trust to move their mobile homes.
Mindset as a Mobile Home Investor
There is nothing inherently good or bad with a singlewide mobile home versus a doublewide mobile home. Both homes/deals may or may not be attractive to purchase. Take into account all repairs, park approval processes, location, local market conditions, time of the year, age of the home, size, bedrooms, and more before making any purchases.
Mindset as a Park Owner
From the perspective of a mobile home park owner, your community only has so much land and so many places to put mobile homes. A doublewide mobile home will double the amount of land needed but typically generate the same amount in lot rent fees.
In conclusion, there is a buyer for most mobile homes you purchase. However, if you’re not investing correctly, it can be easy to lose money and sacrifice profits. Remember that any mobile home you aim to resell should be attractive to a good section of society, as opposed to only a small handful of buyers. Before making purchase offers to sellers, know what local buyers will pay for any property you intend to invest in. Always know exactly what you are investing in before you purchase any home, and enter into every real estate transaction with clarity and understanding