You may have seen a lot of ads for investing in mobile homes.
Is it possible to make a living flipping mobile homes? It depends on where you live. Areas where there are several mobile home parks can be lucrative if you are willing to get out and hustle. You're going to want to stay away from areas where the mobile home is on owner owned land. The reason being is when a mobile home is attached to land, it is considered. So unless you have a real estate license, there is a good chance that you can not sell that property. Mobile homes on leased, rented land or in parks are considered personal property and therefor can be sold just like if you were selling a car or bicycle.
Some things that you are going to want to become familiar with:
- assignment contracts
- sales contracts
- mobile home park rules
When it comes to mobile home park management, they can be a real pain in the ass. I recommend not even mentioning that you are an investor and plan to flip some mobile homes within their park. You only want get the park rules so you have something to work off of when dealing with a potential buyer. Because depending on where you live the parks can have certain income requirements to be able to rent space in their park. In the Los Angeles area many parks require potential renters to have a monthly income 3x's the space rent.
Contract assignments are typically straight forward. You're just a middle man who will collect a fee from the buyer (usually another investor) for a mobile home. You'll want to understand the assignment contract. You may or may not want to let the seller know that you will be assigning the contract to another person. Check your county or state on the rules when it comes to disclosure. Because you don't want to make the seller think that you misled them. Your contract fee can be as little as a couple hundred dollars to a few thousand dollars. You set your rate as to what you want out of the deal. But don't be so greedy that it will kill the chance of a sale.
Sales Contracts: Let's say you buy the mobile home, do some repairs and now you want to sell the home. Get to know what is required as an owner to sell your mobile home. Many states or counties have certain disclosures that have to be completed by you and given to the buyer prior to closing the sale. You'll also want a copy of the park rules to give to the potential buyers. They typically need to get pre-qualified first before they can move forward with the purchase. Have the buyers put a security deposit in an online escrow account. So that once you know that they have been qualified then they can increase the escrow account with the remaining funds to complete the sale and release the funds to you. Another thing that you will want to get very familiar with is where or with who the sale needs to be recorded with. California has an online site with the State to record mobile home sales/transfers.
Contract assignments are great for those that don't have the money to buy a mobile home and are looking for quick cash. Those of you that have the funds to buy a discounted mobile home have the ability to make the most amount of money. But everybody has to start somewhere. Start with assignments and get to know the game of flipping mobile homes. After that the sky is the limit. I've bought mobile homes and do "seller financing" for buyers with limited cash. I like the consistent monthly income and you can actually get more for your home because those buyers don't have the bargaining power to ask for a cash discount.
Happy hunting or fishing and go find some mobile homes to flip or sell.
Remember this is work and get good with marketing. Good marketing will have sellers and buyers contacting like there is no tomorrow. You'll actually have more buyers and not enough homes to sell them. That's my experience. So I'm always on the hunt for more inventory.