In the past, mobile home parks were not the ideal investment in real estate. That is now a thing of the past. The opinion about investing in mobile home parks has changed significantly. After the decade-old real estate market crash, investing in lucrative properties was much more comfortable than before. In those days, investing in property was simple, with an excellent return on investments in a short time.
However, the real estate market today is significantly different than it was 20 years ago. The current market is much tougher than it used to be. Due to higher interest rates, homeowners looking for a new home before the next interest rate hike take up small residential properties quickly.
New investors are starting to get familiar with the do and don’ts of real estate investment. They are rapidly investing and buying the best commercial properties, including the minor multi-family deals on property. On the other hand, large companies with significant capital to invest are scooping up the massive apartment complexes at a price that seems unreasonable to the savvier real estate investors.
Considering the changing market trends, the investors willing to invest in real estate have two choices: they can sit the market out and wait for the market to crash yet again. The second option is that they take a chance with the market and be creative about the different investment opportunities.
One such opportunity is to invest in a mobile home park. Here is why investing in mobile home parks is a feasible decision for keeping the capital safe.
Low Per Unit Cost
The cost per unit of investing in homes and other properties is very high. On the other hand, mobile home parks have a low per-unit cost that makes the investment more profitable than other property investments.
A real estate investment in a mobile home park offers more value per unit with adjusted higher risk returns. The owner of the mobile park owns the land, not the housing units itself. It indicates that the cost of investment is relatively low compared to the number of housing units owned.
Low Maintenance Cost
The most exciting new investment opportunity in a mobile home park is its low cost of repairs and maintenance. It does not require the owner to deal with different contractors for maintenance and repair.
Less Upkeep as Compared to Homes
The mobile home owner is solely responsible for the upkeep of the property once they decide to buy a mobile park as a real estate investment. The expenses for the maintenance of the mobile home park are considerably lower than other properties.
Lower Risk of Loss
Real estate investors are willing to invest in a mobile park because it allows them to purchase more units for every dollar invested. The risk for loss is reduced considerably, as the mobile park can hold more tenants. Having more tenants minimizes the risk of loss as it spreads out more than owning a home or similar property. For example, owning a property like a single-family home will be more expensive and risky if the tenants enforce an eviction. The damage left by the removal will be an expense incurred by the homeowner. This situation is less likely to arise in a mobile park.
Different factors are bound to contribute to the increasing demand for well-maintained mobile home parks. The zoning changes, gentrification, and government-based zoning discourage further investment in mobile home parks. However, the thing is that residential property prices are rising to new highs. However, the average income of the household in the US is not increasing at the same pace. This gap between income and expenditure has forced many families to own a mobile home instead. The high demand for affordable housing has led to an increased demand for mobile home parks.
Reduced Tenant Turnover Rate
Investing in mobile home parks is a better investment decision, as the tenant turnover rate is much less than single or multi-family properties. Tenant turnover is the biggest fear of every property owner; thankfully, the turnover rate for mobile home owners is much less.
Mobile home park owners are not required to track down new tenants as aggressively as a homeowner. It’s easier to find new tenants for a mobile park owner as more and more people are considering moving into a mobile park for an affordable living opportunity.About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file, critical financial documents and back office tools in an efficient and secure environment. Complete Controller’s team of US based accounting professionals are certified QuickBooks™️ ProAdvisor’s providing bookkeeping, record storage, performance reporting and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay services. With flat rate service plans, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.