Diversify Your Portfolio: The Case for Mobile Home Park Investing

  • Passive Income: Mobile home park ownership allows you to collect monthly rent from residents who own and maintain their own individual homes. The resident purchases the house, then continues to pay a monthly space rent for placing their home on the land which the investor owns.
  • High Returns: Mobile home parks have the potential to generate a higher cash-on-cash return compared to other more developed real estate asset classes. Due to resident ownership of their homes, maintenance and expenses are passed to the tenant. This means the owner has a smaller expense ratio, driving higher returns.
  • Portfolio Diversification: Adding a mobile home park investment to your existing portfolio offers immense diversification benefits. This asset class generates greater tax benefits due to accelerated “bonus” depreciation which can bolster your real estate portfolio with certain assets focused on cash flow while other assets, like mobile home parks, focusing on tax savings.
  • Investment: Mobile home parks typically cost more upfront than single-family homes, yet can be generally be acquired for less than a multifamily property of similar caliber.
  • Income: Lot rent from residents is your income stream, yet you can bolster this income by selling off all park-owned-homes to the residents.
  • Expenses: Typical expenses for real estate investments include property taxes, insurance, maintenance, mortgage, and potentially management fees should you decide to outsource the day-to-day management of the community.
  • Return-on-Investment (ROI): Consider income, expenses, appreciation, and financing costs when determining if an investment is viable with your goals.

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