Podcast Episode #5: The Good, Bad and Ugly of MHP Ownership

 

 

 

As with owning any business, there are good things and bad. The hardest part is not knowing enough about the bad upfront, before you’re already in the weeds of ownership. Mobile Home Parks (MHPs) bring with them unique aspects of ownership unlike many other business, even within real estate in general. Being prepared, before you buy, is the best way to ensure a successful purchase and profitable ownership of a mobile home park.

Tenants — good, bad and ugly rolled into one

People don’t treat you nicely just because you’re a fair owner. Good people treat you well, bad people don’t. The key is to carefully vet who comes into your MHP in order to ensure you’ve got a crop of good tenants. Equally important is for the previous MHP owner, who you’re buying the park from, to take the vetting process seriously as well. You don’t want to buy a park full of riffraff you have to try and evict. Vetting is essential.

While you’re vetting the tenants, make sure to do your due diligence with the rest of the park. Make sure things are running properly and that you fully understand what you’re getting into as a new park owner.

Park maintenance — keep the good coming

Once you ensure the right type of tenants are in the park, the next issues to address is maintenance. You don’t want to buy a nice park and have it go downhill because you’re unable to maintain it. Stay on top of issues and keep your park looking nice to continue attracting good tenants, avoiding the bad and the ugly.

The overarching good of ownership

Thankfully, it’s good to know that bad is fixable, the trick is to not become complacent as an owner. You also have to keep what’s good in mind. That MHPs often yield cash flow from day one and have returns that are higher than average. You have the ability to grow the net operating income year-over-year and there’s limited exposure in a down economy.

If you buy a nice park, run it properly and continue to vet tenants carefully as they come in, you’ll reap the rewards of your MHP. Learn more about the ups and downs of MHP ownership with Glen Esterson and Jason Sirotin on the MHP Expert Podcast.

Podcast Transcript

Jason S.: Welcome to The Mobile Home Expert Podcast. I’m Jason Sirotin with mobile home park expert Glen Esterson. Glenn, how you doing today?

Glen E.: I’m doing fantastic. Hope you are too.

Jason S.: I am. Thank you. Well today I’m really excited about this. We’re looking at another chapter of your book, The Mobile Home Park Manifesto, that is the proper title, right? I didn’t butcher it.

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