Welcome back. Let's pretend that as a successful manufactured home investor you have just successfully purchased another manufactured home inside a local manufactured home park.
Your newest manufactured home investment acquisition is an average 1980's model and has 3 bedrooms and 1 full bathroom; the type of manufactured home you have walked through hundreds of times before. The seller is happy to be free of this home and both of you walked away from closing with smiles on your faces. The home is in used condition both inside and out. You know you've made a great deal.
Your next major goal is to sell, rent, or fill this home with a low-risk resident to begin creating cash flow from monthly payments or an all-cash profit from a quick all-cash sale. What else may you want to do?…
Below is a short list of after closing steps to consider completing after every manufactured home you purchase inside a park for investment.
1. Transfer Ownership: After closing it is now time to transfer ownership from the seller to you, your company, trust, or another legal entity. Be aware that in every state there is a maximum number of days before a penalty is charged if you do not transfer ownership of this home. In most states this ownership is conveyed through a Manufactured Home Title and there is a deadline between 7-30 days to transfer ownership. In reality this should be done during closing while the seller is present or immediately after closing to avoid transfer issues should you wait.
This gives you at least a week's time to make a trip to your local DMV, DOT, or state MH division to transfer ownership and receive a new Title, Deed, or SOL. Some states require all Title, taxes, state forms, and sales documentation mailed in versus you being able to transfer ownership in person. A week is still long enough to mail all forms in as needed.
2. Give Gratitude: Who helped you directly find this home? Was this a referral from another investor, dealer, Realtor, park manager, bird-dog, or acquaintance? If the source of the lead is anything else besides “only me” then you owe someone a thank you. This thank you can be in the form of a gift, gift-card, or cash if legal in your area. Most states do have a limit for how much you may pay a non-Realtor for leading you to a deal.
When offering to give a “thank you gift” for successful leads aim to ask the person what he or she feels is a fair compensation he or she is happy with. Often times the amount suggested is lower than the fee you had been thinking in your mind. Either way these unofficial bird-dogs are happy and this is what counts.
3. Making the 1st exterior impression count: Curl appeal goes a long way at making your neighbors, park management, and park owners pleased with the decision to allow you to invest in mobile homes in their park. In addition to the instant park-image improvement by cleaning up your mobile home, your future tenants or buyers are going to approve of the added club appeal.
If a potential buyer says, “Wow!” in a happy way then a sale is more likely to happen versus leaving the home in a dirty condition. Here are some quick clean ups I make right after purchasing most mobile homes inside parks.
Pressure cleaning: If you hire this task out you will likely pay $75-$150 depending on the size of the mobile home and possible extra charge for cleaning the roof. While pressure washing a mobile home will clean deep down algae and dirt, some mobile homes may only need a spot cleaning or nothing at all. Be aware that pressure washing a manufactured home with wood or faux wood siding may easily strip off the paint in places.
Skirting cleanup: A quick fix to add curb appeal to a manufactured home with messy skirting is to clean and straighten these skirting panels yourself. If panels are damaged or missing from the front then simply rotate pieces from the back to clean up the front. This will help add to the home's curb appeal from the road.
Clean the roof: Cool seal is a brand name of Elastomeric roof coating. This roof coating can be applied with a paint roller within a half a day. A nice white coating makes things look new, keeps the home cooler in the summer months, and can help plug up any pinhole sized tears or holes in the roof.
4. Marketing: Continue marketing and sending potential buyers or prospective tenants to your investment home until you have money in your hand at closing. A potential applicant that wants the home still needs to become park approved with the front office before closing with you. This can typically take 1-3 days for the applicant to become approved or denied at the park.
While marketing the home you will be paying holding costs and miscellaneous expenses. For this reason make sure to advertise and market the home for sale or rent in as many channels as possible. You want everyone within a 10 mile radius to know you have a mobile home for sale or rent at an amazing price.
5. Make necessary repairs: Some repairs should almost always be completed for a fast sale to an end-user, while other repairs can be left for a buyer to repair in many cases. Depending on your exit strategy and to whom you are selling to on a regular basis will depend on the amount of repairs you make until you resell this home. Should you leave the home as a handyman special? Should you completely rehab the home back to a “like new” condition? Should you make repairs somewhere in between?
What this article is missing: This article only touches on some of the highly recommended should-do's after purchasing a manufactured home in a park. Depending on your exit strategy and local market the list above will likely expand to many more topics. If you have any questions or comments please do not hesitate to comment them below for us all to learn.