One of the most difficult and time consuming tasks of a mobile home park manager is in the collection of rents. It has been my experience that about 50 percent of your residents will never have a problem paying on time. Then about 25 percent may be late on occasion and are also not a major problem. It is the other 25 percent that will take most of your time and efforts.
It is this last 25 percent that will often make or break the deal. This is usually the money that is left over after you make your loan payment and cover the other operating expenses. So what is a manager/owner to do to make sure that these slow paying residents get motivated to pay?
Here are a few strategies I have used. Of course, make sure that any of these programs are legal in your state. If you have any other thoughts I will post a followup in the next newsletter.
Rent Discounts. Using a rent discount program, I set the rent a little higher than I typically would and then reward those that pay on time. For example, I might set the rent at $220.00 per month and for all of those residents that have paid by the 1st of the month, they will receive a discount of $20.00 for a total of $200.00 per month. Taking this program further, I have had a rent schedule that goes something like this: Rent of $200.00 by the 1st, $220.00 by the 5th, and $240.00 by the 10th and so on.
Late Fees: Whether used in conjunction with the discount program or as a stand alone program, this program will charge late payers a penalty for not paying the rent on time. In most of my parks, this will be a late charge of $20.00 to $25.00 if the rent is not paid by the 5th of the month.
Taking Credit or Debit Cards: In the world of plastic, many people do not carry cash or checks anymore and by adding this convenient payment method you may be able to increase collections. Many times in the past I have had someone fall behind and in order to avoid an pending eviction, one of their relatives will call with a credit card to catch up the balance. I have even taken this to the point that a few of my residents have their credit or debit card on file and we automatically charge them on the first of each month.
Send out Invoices: Even if the rent is exactly the same every month and there is no utility billing, sending out an invoice is a good way to get your rent bill on the pile, so to speak. People are more apt to pay the bills with an invoice first. Using self-addressed stamped envelopes are also an option. In the world of high tech, you might even be able to accomplish sending out the invoices via email. By using a mail merge on excel and word this can be done within minutes. There are also software specific programs out there that will do most of the work.
Sending out Late Notices: It is important to send these out on time every month so your residents know that you haven't forgot about them. You should be persistent and follow-up with phone calls and in person visits. This way they know you mean business.
The 3,5, 7, or 10 day notice: If they have not paid then send them the legal notice to pay or vacate. This should spur some action and after a few times of having to pay court costs, the residents will get the picture that they have to pay. The rent bill should go to the top of the list. The longer you let the resident go without paying the less likely they will be to get caught up. If they don't have the rent money in May, then they probably won't have the May and June rent in June and so on.
Collecting on delinquencies is probably the least enjoyable part of managing a mobile home park but ranks up there with the most important parts. When you find the strategy that works best you should follow it every month like clockwork. You want the residents to pay their rent before they pay on their cell phone bill and other un-necessities.
Tuesday, December 28, 2010
Monday, December 27, 2010
Fill Your Vacancies!
Most mobile home park owners today have vacancy problem, thanks to chattel mortgage crisis that began in 2000. It is not uncommon for a park that was full in 2000 to now be at 60% occupancy due to repossession of homes. If you have been waiting for the mobile home dealers to fill you back up, you are probably depressed and making no progress. So here are some ideas to get you back in action at increasing occupancy;
First of all, you need to locate the folks in your area that have grown to absorb some of the demand that is left unaddressed by dealers. There is still a lot of demand to rent or buy used mobile homes, even if the dealer structure has become a non-player. Most of the time these new “Dealers” are individuals who buy and sell or buy and rent old mobile homes specifically in parks. You need to find these people and get them to bring homes into your park. Two ways you can find them are to 1) talk to local mobile home movers and ask if they have had any mobile home moves with these individuals (they normally remember them because they have more than one) 2) go to competing mobile home parks and see if you can spot any for sale signs that have the same phone numbers. This is a giveaway that they are not selling there own personal homes, but rather it is a business. Offer these entrepreneurs free rent until they get their home sold or rented in your park, or whatever incentive it takes to make your park their new home base.
Another source of homes is to “steal” them from competing park that is doing a lousy job of keeping their tenants happy. Remember that ‘mobile’ means they can be moved. Of course it is not cheap to move a mobile home, so you will have to pay some or all of move cost to get them to move to your property. But it is well worth it. Even at the cost of $3000 for the move, you will get your money back in a year if the rent was $250 per month. Be sure not to ask people to break their lease, only to move to your park if their lease is up and they have the option of moving. Once you get one to move, and they are happy, it is not hard to convince their friends. It is amazing how many park owners give no thought to the resident’s retention and just assume they are their slave forever.
A final idea is to convert your vacant lots into something that is wanted, and that can be tapped with a small capital outlay. For example, consider opening a section of your park as an RV park. A small dedicated RV park within a mobile home park can really work if the location is right. And it is possible to test and, if failure, abandon the project with little or no downside. Or you might consider opening a park and store facility for RVs, boats and cars. Try and see what is in demand, and see if you can deliver on it.
In these tough times, it is essential to be creative to fix your occupancy!
First of all, you need to locate the folks in your area that have grown to absorb some of the demand that is left unaddressed by dealers. There is still a lot of demand to rent or buy used mobile homes, even if the dealer structure has become a non-player. Most of the time these new “Dealers” are individuals who buy and sell or buy and rent old mobile homes specifically in parks. You need to find these people and get them to bring homes into your park. Two ways you can find them are to 1) talk to local mobile home movers and ask if they have had any mobile home moves with these individuals (they normally remember them because they have more than one) 2) go to competing mobile home parks and see if you can spot any for sale signs that have the same phone numbers. This is a giveaway that they are not selling there own personal homes, but rather it is a business. Offer these entrepreneurs free rent until they get their home sold or rented in your park, or whatever incentive it takes to make your park their new home base.
Another source of homes is to “steal” them from competing park that is doing a lousy job of keeping their tenants happy. Remember that ‘mobile’ means they can be moved. Of course it is not cheap to move a mobile home, so you will have to pay some or all of move cost to get them to move to your property. But it is well worth it. Even at the cost of $3000 for the move, you will get your money back in a year if the rent was $250 per month. Be sure not to ask people to break their lease, only to move to your park if their lease is up and they have the option of moving. Once you get one to move, and they are happy, it is not hard to convince their friends. It is amazing how many park owners give no thought to the resident’s retention and just assume they are their slave forever.
A final idea is to convert your vacant lots into something that is wanted, and that can be tapped with a small capital outlay. For example, consider opening a section of your park as an RV park. A small dedicated RV park within a mobile home park can really work if the location is right. And it is possible to test and, if failure, abandon the project with little or no downside. Or you might consider opening a park and store facility for RVs, boats and cars. Try and see what is in demand, and see if you can deliver on it.
In these tough times, it is essential to be creative to fix your occupancy!
Wednesday, December 22, 2010
Renting Mobile Homes Won't Make You Rich
There are a lot of books out there extolling the financial benefits of buying mobile homes for purposes of renting them out. DON'T BE SUCKERED INTO THIS WITHOUT GETTING THE FULL STORY. These books generally leave out three important problems that turn any proposed economics into bankruptcy.
They are:
Tenants will trash the property and steal appliances (including furnaces and air-conditioners) on just about every rental, and the cost to repair will exceed your gross rent
Tenants will never pay their rent on time, and will require a costly eviction and writ of execution to get them out for only a few short months.
Mobile homes make for lousy rental properties because they are too flimsily constructed. Who ever heard of 1" x2" framing? Go to a factory and see for yourself how they're built. A 10 year old can rip a door off its hinges
So what does this mean? It means that any revenue you take in will immediately go back out the door (and then some) in repairs and make-ready, and legal fees.
Don't believe us? Look at the financial statements of those publicly held REITs that rent mobile homes and see how impressive those numbers are. Or talk to someone who has already made such an investment and see how they're doing. You'll soon get the accurate picture.
I once had a guy come up to me at eviction in court, out in the hallway. This guy liked to go around and buy properties this way, hoping that disgusted landlords would sell them cheap, and he would then throw them into his slumlord empire. I told him my properties were mobile homes � not stick-built houses. He looked at me and said "I don't deal in that junk � there's no money in it!" That's the most accurate analysis I've heard (unless you own the park).
So why do they sell such books? Because everyone wants to believe that there is a great rich quick scheme out there, even when they know it sounds too good to be true. If you want to learn how to REALLY make money in the mobile home business, especially with the mobile home side of it check out our new book titled "The Insider's Guide to Buying New and Used Mobile Homes" available on our bookstore.
They are:
Tenants will trash the property and steal appliances (including furnaces and air-conditioners) on just about every rental, and the cost to repair will exceed your gross rent
Tenants will never pay their rent on time, and will require a costly eviction and writ of execution to get them out for only a few short months.
Mobile homes make for lousy rental properties because they are too flimsily constructed. Who ever heard of 1" x2" framing? Go to a factory and see for yourself how they're built. A 10 year old can rip a door off its hinges
So what does this mean? It means that any revenue you take in will immediately go back out the door (and then some) in repairs and make-ready, and legal fees.
Don't believe us? Look at the financial statements of those publicly held REITs that rent mobile homes and see how impressive those numbers are. Or talk to someone who has already made such an investment and see how they're doing. You'll soon get the accurate picture.
I once had a guy come up to me at eviction in court, out in the hallway. This guy liked to go around and buy properties this way, hoping that disgusted landlords would sell them cheap, and he would then throw them into his slumlord empire. I told him my properties were mobile homes � not stick-built houses. He looked at me and said "I don't deal in that junk � there's no money in it!" That's the most accurate analysis I've heard (unless you own the park).
So why do they sell such books? Because everyone wants to believe that there is a great rich quick scheme out there, even when they know it sounds too good to be true. If you want to learn how to REALLY make money in the mobile home business, especially with the mobile home side of it check out our new book titled "The Insider's Guide to Buying New and Used Mobile Homes" available on our bookstore.
Monday, December 20, 2010
Finding and Evaluating Mobile Home Parks
Of all the questions I receive from investors that are looking to purchase a mobile home park there are two questions that are asked most often:
How do I find a mobile home park deal that makes sense?
How do I place a value on that mobile home park?
These are important questions and there are several ways to find mobile home park investments and even more ways that one can approach evaluation of that investment. When I first started in the business about 12 years ago, I spent a lot of money driving across the country looking at listings I found in major newspapers and on the internet. While this allowed me to see a lot of potential deals, it was a big waste of time and money. Many times I would get in my car and drive 1,000 miles only to find that the park I was looking at was a complete dump, had unrealistic profit and loss projections, or was already under contract by another investor.
I soon realized that it was worthwhile to do a more thorough analysis before visiting the property. If it passed the initial analysis, then I would try to get an accepted offer and request detailed financials from the seller. If it still looked good I would schedule a trip to visit the park. Before implementing this strategy, I was visiting about ten parks for every one I purchased. Now, that ratio is more like two-to-one and I am not on the road all the time.
If the mobile home park looks good on paper, get it under contract before spending $1,000.00 in travel and two days to visit it!
In order to find a mobile home park that makes sense financially the most important part is to be able to quickly identify and separate the good deals from the bad. The only way to acquire this skill is to educate yourself on this business (through books and other resources) and start looking at as many mobile home park offerings as you can. With the availability of information on the internet you can accomplish this task quickly. Go to MHPS.com and other internet websites such as Loopnet.com where you can view over a thousand mobile home parks for sale.
Whether you are a new or seasoned investor in this asset class I would suggest getting the information on as many properties as you can and then put them side-by-side and analyze each one. You will get an idea of the capitalization rates, expense ratios, occupancy levels, and rental rates for different markets. You will find prices all over the place but if you invest the time and effort in evaluating deals, you will start to develop an idea of what to look for in terms of price-per-space, how park-owned homes affect values and other important factors.
Invest the time in evaluating as many deals as possible and invest the money on properly educating yourself on the business so that you can separate the good deals from the bad and concentrate on those with promise!
So where is the best place to find a mobile home park to buy? The best answer to this question is that you should try as many logical approaches as possible. As mentioned above, I would suggest you start by checking out the websites that have thousands of mobile home parks for sale like MHPS.com and other commercial real estate sites such as Loopnet.com. There are new parks listed daily on these sites and the best way to utilize these services is to sign up for notification of new properties for sale. This way you have a better chance of jumping on the good deals before they are available to the general public.
I have purchased over 50 mobile home parks over the past 12 years and about 15 of those purchases came as a direct result of listings on the internet.
The next strategy that I would suggest is to start a direct mail campaign to mobile home parks that are in the markets and states that you are interested in. This has accounted for about 20 of my 50 mobile home park purchases. If you obtain a good list of addresses, you can target mobile home parks with a certain number of spaces in select markets expressing your interest in purchasing a mobile home park.
I have experimented with postcards, letters, and even actual purchase contracts and have found that the response is about the same for each of these. The key has not been in the type of piece but in the frequency of mailing. I have received many calls from mobile home park owners saying that they have received our numerous mailings over the years and are giving us first shot at the park since they know we are a legitimate company. I actually had one seller pull out a file included over 25 mailings from us. In another instance I mailed out 1,000 letters to two states expressing our interest in buying mobile home parks. I followed this up about 2 weeks later with the same mailing piece (in error) and found that my response rate was about 100% higher from the second mailing. So the key with direct mail is in getting a good list to mail to and frequency.
There are several other options that I have used with varying degrees of success. I have listed some of these below.
Driving through mobile home parks in markets you are interested in and talking with the onsite manager/owner or following up with cold calls or letters to parks that you would be interested in owning. The advantage of this method is that you see the park before you start any communication with the owner and it will give the owner a level of comfort dealing with someone that made the effort to see the park first. This works best with an owner that lives onsite and you can meet face-to-face. I have purchased several parks this way and there are many other parks I still have an open line of communication with the owner that I anticipate purchasing when they are ready to sell..
Making cold calls to parks in markets I am interested in. While this works best when the owner answers the phone, it can be very frustrating. I have been hung up on many times as have my employees. However, if you don't mind the frustrations, this is a viable method of finding potential deals. Besides being hung up on, the biggest frustration I have had is that you often get the response that anything is for sale at the right price (which is usually more than it is worth).
Another option is to stay in contact with real estate brokers that specialize in the sale of Mobile Home Parks. The key here is to stay in constant contact with these brokers in order to get a copy of all of their listings as soon as they receive them. Before they put the listings on the internet they will send out the information to the buyers they know are serious in hopes of making a quick sale. You want to be on that list so you get first shot at the good listings. Once you have a relationship with a broker and especially after you successfully close a transaction with them, they will know that you are a real buyer. I have one broker that I have purchased three parks from and he knows what I am looking for and contacts me anytime he gets something that fits those criteria.
Along with staying in contact with those brokers that specialize in mobile home parks and commercial real estate, you should contact brokers in those specific markets you are looking to buy parks. Many times these brokers will not have any idea about the internet sites that can help them sell the parks and otherwise do not understand how to value and market mobile home parks. While many times their listings will be grossly overpriced you will occasionally find those listings that are priced right or even better� under market.
Newspapers (online and offline), trade magazines, local and national MLS services, and other websites.
Country tax records, banks, appraisers, movers, dealers, and other industry professionals.
The key to locating good potential mobile home parks investments is to be diligent in your search and use whatever methods work best for you. The best deals are usually found by finding those parks that are the least advertised.
Once you find a potential mobile home park that looks a winner, the next step will be determining the value of that park. This will be the subject of my next article and will include a discussion on the methods I use in the evaluation of mobile home parks.
How do I find a mobile home park deal that makes sense?
How do I place a value on that mobile home park?
These are important questions and there are several ways to find mobile home park investments and even more ways that one can approach evaluation of that investment. When I first started in the business about 12 years ago, I spent a lot of money driving across the country looking at listings I found in major newspapers and on the internet. While this allowed me to see a lot of potential deals, it was a big waste of time and money. Many times I would get in my car and drive 1,000 miles only to find that the park I was looking at was a complete dump, had unrealistic profit and loss projections, or was already under contract by another investor.
I soon realized that it was worthwhile to do a more thorough analysis before visiting the property. If it passed the initial analysis, then I would try to get an accepted offer and request detailed financials from the seller. If it still looked good I would schedule a trip to visit the park. Before implementing this strategy, I was visiting about ten parks for every one I purchased. Now, that ratio is more like two-to-one and I am not on the road all the time.
If the mobile home park looks good on paper, get it under contract before spending $1,000.00 in travel and two days to visit it!
In order to find a mobile home park that makes sense financially the most important part is to be able to quickly identify and separate the good deals from the bad. The only way to acquire this skill is to educate yourself on this business (through books and other resources) and start looking at as many mobile home park offerings as you can. With the availability of information on the internet you can accomplish this task quickly. Go to MHPS.com and other internet websites such as Loopnet.com where you can view over a thousand mobile home parks for sale.
Whether you are a new or seasoned investor in this asset class I would suggest getting the information on as many properties as you can and then put them side-by-side and analyze each one. You will get an idea of the capitalization rates, expense ratios, occupancy levels, and rental rates for different markets. You will find prices all over the place but if you invest the time and effort in evaluating deals, you will start to develop an idea of what to look for in terms of price-per-space, how park-owned homes affect values and other important factors.
Invest the time in evaluating as many deals as possible and invest the money on properly educating yourself on the business so that you can separate the good deals from the bad and concentrate on those with promise!
So where is the best place to find a mobile home park to buy? The best answer to this question is that you should try as many logical approaches as possible. As mentioned above, I would suggest you start by checking out the websites that have thousands of mobile home parks for sale like MHPS.com and other commercial real estate sites such as Loopnet.com. There are new parks listed daily on these sites and the best way to utilize these services is to sign up for notification of new properties for sale. This way you have a better chance of jumping on the good deals before they are available to the general public.
I have purchased over 50 mobile home parks over the past 12 years and about 15 of those purchases came as a direct result of listings on the internet.
The next strategy that I would suggest is to start a direct mail campaign to mobile home parks that are in the markets and states that you are interested in. This has accounted for about 20 of my 50 mobile home park purchases. If you obtain a good list of addresses, you can target mobile home parks with a certain number of spaces in select markets expressing your interest in purchasing a mobile home park.
I have experimented with postcards, letters, and even actual purchase contracts and have found that the response is about the same for each of these. The key has not been in the type of piece but in the frequency of mailing. I have received many calls from mobile home park owners saying that they have received our numerous mailings over the years and are giving us first shot at the park since they know we are a legitimate company. I actually had one seller pull out a file included over 25 mailings from us. In another instance I mailed out 1,000 letters to two states expressing our interest in buying mobile home parks. I followed this up about 2 weeks later with the same mailing piece (in error) and found that my response rate was about 100% higher from the second mailing. So the key with direct mail is in getting a good list to mail to and frequency.
There are several other options that I have used with varying degrees of success. I have listed some of these below.
Driving through mobile home parks in markets you are interested in and talking with the onsite manager/owner or following up with cold calls or letters to parks that you would be interested in owning. The advantage of this method is that you see the park before you start any communication with the owner and it will give the owner a level of comfort dealing with someone that made the effort to see the park first. This works best with an owner that lives onsite and you can meet face-to-face. I have purchased several parks this way and there are many other parks I still have an open line of communication with the owner that I anticipate purchasing when they are ready to sell..
Making cold calls to parks in markets I am interested in. While this works best when the owner answers the phone, it can be very frustrating. I have been hung up on many times as have my employees. However, if you don't mind the frustrations, this is a viable method of finding potential deals. Besides being hung up on, the biggest frustration I have had is that you often get the response that anything is for sale at the right price (which is usually more than it is worth).
Another option is to stay in contact with real estate brokers that specialize in the sale of Mobile Home Parks. The key here is to stay in constant contact with these brokers in order to get a copy of all of their listings as soon as they receive them. Before they put the listings on the internet they will send out the information to the buyers they know are serious in hopes of making a quick sale. You want to be on that list so you get first shot at the good listings. Once you have a relationship with a broker and especially after you successfully close a transaction with them, they will know that you are a real buyer. I have one broker that I have purchased three parks from and he knows what I am looking for and contacts me anytime he gets something that fits those criteria.
Along with staying in contact with those brokers that specialize in mobile home parks and commercial real estate, you should contact brokers in those specific markets you are looking to buy parks. Many times these brokers will not have any idea about the internet sites that can help them sell the parks and otherwise do not understand how to value and market mobile home parks. While many times their listings will be grossly overpriced you will occasionally find those listings that are priced right or even better� under market.
Newspapers (online and offline), trade magazines, local and national MLS services, and other websites.
Country tax records, banks, appraisers, movers, dealers, and other industry professionals.
The key to locating good potential mobile home parks investments is to be diligent in your search and use whatever methods work best for you. The best deals are usually found by finding those parks that are the least advertised.
Once you find a potential mobile home park that looks a winner, the next step will be determining the value of that park. This will be the subject of my next article and will include a discussion on the methods I use in the evaluation of mobile home parks.
Sunday, December 19, 2010
Don't Expect More from Park Residents than You Do from Subdivision Residents
IT'S NOT GOOD FOR YOU OR THEM!
Written by Frank Rolfe and Dave Reynolds, MobileHomeParkStore.com, LLC
Most every mobile home park owner in the U.S. has a list of rules attached to their lease which is longer than the lease itself. While it's always a good idea to cover your bases and address every possible behavior concern, it's another to expect people to follow more rules than the local prison.
More importantly, what's in it for the park owner?
It's my theory that you should not expect to hold mobile home park residents to a higher standard than those of the folks who live in brick houses in the nearest subdivision. It would make sense that someone who lives in a mobile home is less likely to obey the rules than these stick built home occupants, so why are their park rules ten times longer?
Take a drive around the subdivisions nearest your park. What do you see? I'm betting you see the same things you do in your park. High grass, junk in the yards, non running vehicles and the like. They are just better at hiding it because you can't see into their back yards as easily, and the non running vehicle is up on blocks behind the house. Still, the general quality of violation looks a lot like your park.
My point is that humans, regardless of demographics, violate certain rules as a regular part of their existence. It may not be aesthetic, or morally right, but trying to fight it is like trying to stop the Mississippi River, basically impossible.
Does that mean that you should reduce the number of rules attached to your lease? No, you want to have every contingency covered. However, you may want to think again about what you enforce, and how hard you enforce it. For guidance on this concept, let's look at a typical city government and what it asks of its residents and how they force compliance.
High grass: In most cities, having grass over a certain height, normally 8" is a violation of code. As a result, violators will generally get a warning and a deadline to comply and, if not completed, will get a fine and/or someone from the city will mow it and bill you for it. They don't threaten to evict you, and they don't set the rule at some ridiculously low level like 4".
Non running vehicles: If you don't get rid of them, after receiving a warning, you will get a significant fine. If you don't pay the fine, you will get arrested. Perhaps we can substitute "arrested" for "evicted" in the park rules theology.
Junk in yards: Again, if you don't clean out your yard, they will fine you and force you to pay. However, you have to have a lot of junk to trigger a code officer writing you up.
Aesthetic issues: Painting your house for example. This is hardly even covered in most city ordinances, because they only deal with the absolute worst, most community damaging offenders. They don't get involved in the small stuff, and maybe you shouldn't either.
Just about everything else: Loose dogs, loud music, etc. This is a police matter. It should be for your tenants too. You should not get involved in being the enforcer. That is what police are for.
I think that this is really about all you need to follow on rules enforcement. Some owners have built a career on rules. They spend every waking hour harassing tenants and sending threatening letters, but does it make them any money?
Some might argue that it does in the form of making the park more desirable looking for new tenants, or park buyers or lenders. I would agree, but you can always "doll up" the park right before putting it on the market or refinancing it. As for new tenants coming in, let's get serious, how many new homes are being sold and moved into parks in your area? That's what I thought.
As for resident retention, you are just as likely or more so to scare off existing tenants with a lot of rules and tough enforcement. If they wanted a beautiful, problem free environment, they shouldn't have moved into a mobile home park in the first place. Further, I have found such demanding tenants never stick anyway, since they are always unhappy and end up moving out no matter what you do.
In conclusion, try taking a more mellow, practical view to rules and their enforcement. Your life will improve, and so will your tenants. You can devote those "rule enforcer" hours to more productive uses, like making money.
Written by Frank Rolfe and Dave Reynolds, MobileHomeParkStore.com, LLC
Most every mobile home park owner in the U.S. has a list of rules attached to their lease which is longer than the lease itself. While it's always a good idea to cover your bases and address every possible behavior concern, it's another to expect people to follow more rules than the local prison.
More importantly, what's in it for the park owner?
It's my theory that you should not expect to hold mobile home park residents to a higher standard than those of the folks who live in brick houses in the nearest subdivision. It would make sense that someone who lives in a mobile home is less likely to obey the rules than these stick built home occupants, so why are their park rules ten times longer?
Take a drive around the subdivisions nearest your park. What do you see? I'm betting you see the same things you do in your park. High grass, junk in the yards, non running vehicles and the like. They are just better at hiding it because you can't see into their back yards as easily, and the non running vehicle is up on blocks behind the house. Still, the general quality of violation looks a lot like your park.
My point is that humans, regardless of demographics, violate certain rules as a regular part of their existence. It may not be aesthetic, or morally right, but trying to fight it is like trying to stop the Mississippi River, basically impossible.
Does that mean that you should reduce the number of rules attached to your lease? No, you want to have every contingency covered. However, you may want to think again about what you enforce, and how hard you enforce it. For guidance on this concept, let's look at a typical city government and what it asks of its residents and how they force compliance.
High grass: In most cities, having grass over a certain height, normally 8" is a violation of code. As a result, violators will generally get a warning and a deadline to comply and, if not completed, will get a fine and/or someone from the city will mow it and bill you for it. They don't threaten to evict you, and they don't set the rule at some ridiculously low level like 4".
Non running vehicles: If you don't get rid of them, after receiving a warning, you will get a significant fine. If you don't pay the fine, you will get arrested. Perhaps we can substitute "arrested" for "evicted" in the park rules theology.
Junk in yards: Again, if you don't clean out your yard, they will fine you and force you to pay. However, you have to have a lot of junk to trigger a code officer writing you up.
Aesthetic issues: Painting your house for example. This is hardly even covered in most city ordinances, because they only deal with the absolute worst, most community damaging offenders. They don't get involved in the small stuff, and maybe you shouldn't either.
Just about everything else: Loose dogs, loud music, etc. This is a police matter. It should be for your tenants too. You should not get involved in being the enforcer. That is what police are for.
I think that this is really about all you need to follow on rules enforcement. Some owners have built a career on rules. They spend every waking hour harassing tenants and sending threatening letters, but does it make them any money?
Some might argue that it does in the form of making the park more desirable looking for new tenants, or park buyers or lenders. I would agree, but you can always "doll up" the park right before putting it on the market or refinancing it. As for new tenants coming in, let's get serious, how many new homes are being sold and moved into parks in your area? That's what I thought.
As for resident retention, you are just as likely or more so to scare off existing tenants with a lot of rules and tough enforcement. If they wanted a beautiful, problem free environment, they shouldn't have moved into a mobile home park in the first place. Further, I have found such demanding tenants never stick anyway, since they are always unhappy and end up moving out no matter what you do.
In conclusion, try taking a more mellow, practical view to rules and their enforcement. Your life will improve, and so will your tenants. You can devote those "rule enforcer" hours to more productive uses, like making money.
Thursday, December 16, 2010
How to Move a Mobile Home
You are about to spend $2,000, $4,000 or more in moving, setup, and installation costs to move your mobile home.
Most problems and mistakes with moving homes can be avoided. We have made all the mistakes the hard way... by paying for them!
Don't make the same mistakes we have made and learn from our experience of having several hundred mobile homes moved over the past 15 years.
Find out How to Choose a Mobile Home Mover/Transporter.
Go Through the Process from Teardown to Transporting to Installation.
If You are Moving a Mobile Home to a Mobile Home Park, Learn How to Get it Moved for FREE or At Least at a Big Discount!
I have received many phone calls and emails over the past 10 years from individuals who have hired a mover that takes the money and runs, or the mover that is not licensed or insured and causes damage to the home, or the mover that receives payment up front and then puts you on the back of the schedule.
DON'T Let this Happen to YOU!
The "Complete Guide to Moving your Mobile Home" describes and shows you the Proper way to Minimize Risks and meet your Goal of Moving your Mobile Home.
It is a simple system to follow and after reading the Book, you will sleep better knowing that you have the tools necessary to avoid the traps and pitfalls that so many people have run into over the years.
Inside the "Complete Guide to Moving your Mobile Home" you will find the following:
THE BASICS OF HOW A MOBILE HOME IS MOVED
PREPARATION FOR THE MOVE
THE MOVE
HOME INSTALLATION
ESSENTIAL HOME PREPARATION FOR TRANSPORT
HOW TO CHOOSE A TRANSPORTER
WHEN TO PAY THE TRANSPORTER
ESSENTIAL HOME INSTALLATION
THE DELIVERY OF THE HOME BY THE TRANSPORTER
SETTING THE HOME
WHAT CAN GO WRONG?
HOW TO MITIGATE YOUR RISKS
PREPARE YOUR HOME FOR THE MOVE EFFECTIVELY
TIPS ON SAVING MONEY ON MOVING A MOBILE HOME
--------------------------------------------------------------------------------
The "Complete Guide to Moving your Mobile Home" e-book is available online now for you to read. We thought about charging for it up front but then some people would miss out on some very important information that will cost them in the long run.
So you can read it now, for FREE. If after going through the book, you find that it was helpful, then there is a a link at the end of the book to purchase the PDF version for $5.00.
Go to Page 1 of the Mobile Home Mover Book
Most problems and mistakes with moving homes can be avoided. We have made all the mistakes the hard way... by paying for them!
Don't make the same mistakes we have made and learn from our experience of having several hundred mobile homes moved over the past 15 years.
Find out How to Choose a Mobile Home Mover/Transporter.
Go Through the Process from Teardown to Transporting to Installation.
If You are Moving a Mobile Home to a Mobile Home Park, Learn How to Get it Moved for FREE or At Least at a Big Discount!
I have received many phone calls and emails over the past 10 years from individuals who have hired a mover that takes the money and runs, or the mover that is not licensed or insured and causes damage to the home, or the mover that receives payment up front and then puts you on the back of the schedule.
DON'T Let this Happen to YOU!
The "Complete Guide to Moving your Mobile Home" describes and shows you the Proper way to Minimize Risks and meet your Goal of Moving your Mobile Home.
It is a simple system to follow and after reading the Book, you will sleep better knowing that you have the tools necessary to avoid the traps and pitfalls that so many people have run into over the years.
Inside the "Complete Guide to Moving your Mobile Home" you will find the following:
THE BASICS OF HOW A MOBILE HOME IS MOVED
PREPARATION FOR THE MOVE
THE MOVE
HOME INSTALLATION
ESSENTIAL HOME PREPARATION FOR TRANSPORT
HOW TO CHOOSE A TRANSPORTER
WHEN TO PAY THE TRANSPORTER
ESSENTIAL HOME INSTALLATION
THE DELIVERY OF THE HOME BY THE TRANSPORTER
SETTING THE HOME
WHAT CAN GO WRONG?
HOW TO MITIGATE YOUR RISKS
PREPARE YOUR HOME FOR THE MOVE EFFECTIVELY
TIPS ON SAVING MONEY ON MOVING A MOBILE HOME
--------------------------------------------------------------------------------
The "Complete Guide to Moving your Mobile Home" e-book is available online now for you to read. We thought about charging for it up front but then some people would miss out on some very important information that will cost them in the long run.
So you can read it now, for FREE. If after going through the book, you find that it was helpful, then there is a a link at the end of the book to purchase the PDF version for $5.00.
Go to Page 1 of the Mobile Home Mover Book
Wednesday, December 15, 2010
Fill Your Vacant Lot
I can remember when a good, well-located community could fill seven or eight lots per month with nothing more than some flyers at a manufactured home dealership. To even say such things today dates you as someone from the dinosaur age. And unless you've been in a cave, you know that you are lucky to fill one lot per year in that manner today.
So how do you fill vacant lots in your community? Well, a lot differently than you did in the past and it takes a whole lot more effort. But you'll find that once you put your program together, it will turn your life and spirits around to see new homes coming in to those old, dusty lots.
If you have been reading this magazine at all for the last seven or eight years, you are pretty familiar with the industry "chattel crisis". Basically, it was the sub-prime mess of today, only fully focused on manufactured homes. People bought homes they could not afford, and they went back to the lenders in record numbers. As a result, lenders don't do "easy" lending any more on manufactured homes, and the sales have suffered enormously as a result. Dealers that were selling 10 or 20 houses a month in 1998 are now lucky to sell 2 or3. And very few of those homes end up in land lease communities they almost always end up on private land. So to fill your vacant lots, you have to forget about those dealerships filling you up, and take control of your destiny yourself.
These are my ideas for filling up your vacant lots in the real-world of today:
Become the #1 community for new home dealers. Am I contradicting myself? No, those dealerships do sell an occasional unit that goes into a land lease community, so you can't ignore them altogether. To get any fill rate from these guys, you have to make sure that you have a 100% closing rate on any inquiry for a lot. Make sure that you have flyers at every dealer, as well as an attractive "move-in special" program to entice customers. And call each sales manager or salesman periodically to let them know you really want their business.
See if those same dealers would want to move some inventory into your community and sell it on location. When I went to buy my stick-built house, I choose a location I wanted, and then inspected the available inventory for sale on MLS. Why shouldn't manufactured home buyers do the same thing? Instead of having some used or new inventory gathering dust on the sales lot, see if the dealership would have any interest siting a couple units in your community and advertise them as a "location sale". That's how every other form of housing is sold. We convinced a dealer in Oklahoma to try it, and he sold six units in this first year! You will probably have to give the dealer free lot rent until the unit is sold that's a small price to pay.
Locate those individuals who like to buy and sell or rent manufactured homes, and see if they will bring in inventory to your community. Sometimes referred to as "Lonnie deals", named after Lonnie Scruggs who wrote the book "Deals on Wheels", these are transactions where someone purchases a manufactured home and then re-sells it or rents it for a profit. Many of these homes begin life in the older inventory section of a dealer, or on private land, and are then initially moved into a community. Make sure that your community is where they go. You can find these "Lonnie" individuals by driving through other communities looking for "For Sale" or "For Rent" signs that share the same phone number, or by asking the local dealers and home movers. We have one individual who has brought in about 40 homes to date under this system. Again, you will have to give the "Lonnie" individual free rent until it sells. Big deal.
Bring in homes yourself, and then rent or sell them. It's not that difficult. You buy them from a dealer, or from a broker, or even new from a manufacturer. You then either sell them or rent them once they are set up in your community. Two things to watch out for in this scenario 1) you must get a dealer's license in most states and 2) it takes a lot of capital. Just bringing the home in, setting it up, and skirting it can cost about $3,000.
Convince residents from competing communities to move over to yours. I've left this idea for last, since it causes hard-feelings between community owners (and rightfully so!), and can cause a dangerous catch-22 situation where community owners are constantly trying to steal each other's customers. There are two times in which I have used this system, and both were special situations that were not quite as bad as just going after the other guy's tenants. The first is when a competing property is being closed down for new development. In those events, the minute you hear about it, go to the community that is being shut down and tell the manager or owner that you want all of his customers and are willing to pay for the whole move, or part of the move, just to get their business. I once scored 35 homes out of a community closing for the development of Home Depot using this very approach. Normally, the owner of the community that is closing is more than happy to have an option to send his folks. The other time that it is proper to consider trying to obtain customers en masse is when there is a community that is truly doing a terrible job, and the residents want out badly. The reasons can be numerous frequent water or sewer outages, poor management, a location that has become unsafe, the list is endless. You normally find out about such an opportunity when several tenants come to your property suddenly, wanting to move over. In those cases, I tell folks to tell all their friends that we would be happy to take them, or even send a flyer letting people know that if they want to move their home, we would love to have them. You can sometimes pick up 10 or 20 new residents by doing this.
Until industry sales improve, these proactive steps are essential for filling your vacancies, and getting your community on a strong financial footing. Don't wait by the phone for a dealer to call put this plan into motion today!
So how do you fill vacant lots in your community? Well, a lot differently than you did in the past and it takes a whole lot more effort. But you'll find that once you put your program together, it will turn your life and spirits around to see new homes coming in to those old, dusty lots.
If you have been reading this magazine at all for the last seven or eight years, you are pretty familiar with the industry "chattel crisis". Basically, it was the sub-prime mess of today, only fully focused on manufactured homes. People bought homes they could not afford, and they went back to the lenders in record numbers. As a result, lenders don't do "easy" lending any more on manufactured homes, and the sales have suffered enormously as a result. Dealers that were selling 10 or 20 houses a month in 1998 are now lucky to sell 2 or3. And very few of those homes end up in land lease communities they almost always end up on private land. So to fill your vacant lots, you have to forget about those dealerships filling you up, and take control of your destiny yourself.
These are my ideas for filling up your vacant lots in the real-world of today:
Become the #1 community for new home dealers. Am I contradicting myself? No, those dealerships do sell an occasional unit that goes into a land lease community, so you can't ignore them altogether. To get any fill rate from these guys, you have to make sure that you have a 100% closing rate on any inquiry for a lot. Make sure that you have flyers at every dealer, as well as an attractive "move-in special" program to entice customers. And call each sales manager or salesman periodically to let them know you really want their business.
See if those same dealers would want to move some inventory into your community and sell it on location. When I went to buy my stick-built house, I choose a location I wanted, and then inspected the available inventory for sale on MLS. Why shouldn't manufactured home buyers do the same thing? Instead of having some used or new inventory gathering dust on the sales lot, see if the dealership would have any interest siting a couple units in your community and advertise them as a "location sale". That's how every other form of housing is sold. We convinced a dealer in Oklahoma to try it, and he sold six units in this first year! You will probably have to give the dealer free lot rent until the unit is sold that's a small price to pay.
Locate those individuals who like to buy and sell or rent manufactured homes, and see if they will bring in inventory to your community. Sometimes referred to as "Lonnie deals", named after Lonnie Scruggs who wrote the book "Deals on Wheels", these are transactions where someone purchases a manufactured home and then re-sells it or rents it for a profit. Many of these homes begin life in the older inventory section of a dealer, or on private land, and are then initially moved into a community. Make sure that your community is where they go. You can find these "Lonnie" individuals by driving through other communities looking for "For Sale" or "For Rent" signs that share the same phone number, or by asking the local dealers and home movers. We have one individual who has brought in about 40 homes to date under this system. Again, you will have to give the "Lonnie" individual free rent until it sells. Big deal.
Bring in homes yourself, and then rent or sell them. It's not that difficult. You buy them from a dealer, or from a broker, or even new from a manufacturer. You then either sell them or rent them once they are set up in your community. Two things to watch out for in this scenario 1) you must get a dealer's license in most states and 2) it takes a lot of capital. Just bringing the home in, setting it up, and skirting it can cost about $3,000.
Convince residents from competing communities to move over to yours. I've left this idea for last, since it causes hard-feelings between community owners (and rightfully so!), and can cause a dangerous catch-22 situation where community owners are constantly trying to steal each other's customers. There are two times in which I have used this system, and both were special situations that were not quite as bad as just going after the other guy's tenants. The first is when a competing property is being closed down for new development. In those events, the minute you hear about it, go to the community that is being shut down and tell the manager or owner that you want all of his customers and are willing to pay for the whole move, or part of the move, just to get their business. I once scored 35 homes out of a community closing for the development of Home Depot using this very approach. Normally, the owner of the community that is closing is more than happy to have an option to send his folks. The other time that it is proper to consider trying to obtain customers en masse is when there is a community that is truly doing a terrible job, and the residents want out badly. The reasons can be numerous frequent water or sewer outages, poor management, a location that has become unsafe, the list is endless. You normally find out about such an opportunity when several tenants come to your property suddenly, wanting to move over. In those cases, I tell folks to tell all their friends that we would be happy to take them, or even send a flyer letting people know that if they want to move their home, we would love to have them. You can sometimes pick up 10 or 20 new residents by doing this.
Until industry sales improve, these proactive steps are essential for filling your vacancies, and getting your community on a strong financial footing. Don't wait by the phone for a dealer to call put this plan into motion today!
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