Mobile Homes in Parks Offer Affordable Alternatives to Buyers (and Renters Turned Buyers)
Buyer’s aren’t typically excited when I mention mobile homes, especially if they are in a mobile home park. Not surprising to me though, mobile home parks are updating quite nicely. So, I sometimes suggest this option. Occasionally, my buyer clients agree to drive through our parks to see if the homes, and the parks in which they are located, could be a fit for them.
Currently, we have three mobile home parks in Cloverdale. They are:
- 7 Palms
- Dutcher Creek Village
If you think I’m wrong, I dare you to take a drive through any of these three mobile home parks. One of the parks has covered carports with solar panels on the roofs. Another, has a swimming pool and amazing views. And the other has a very pleasant feel. You’ll see…
My Favorite Listing Today, is a Tiny Mobile Home in Dutcher Creek Village
On the date of writing this post, one of my favorite listings is a tiny home in the Dutcher Creek Mobile Home Park on the south end of town.
It’s a newer (built in 2001), 1 bedroom, tiny mobile home in a park with a full kitchen and bathroom. But the best part about this home is the view. Incredibly, you could extend your living space out onto your covered deck, and look over the gorgeous nearby ridges and see Mount Saint Helena! And to top off this excellent location, this little gem is across the street from the Dutcher Creek Village Mobile Home Park pool!
Similar in size to some of our rentals, this home could be a good fit for a number of our tenants. As a matter of fact, I mentioned this home to someone who was looking for a small rental. “If this tiny home is so marvelous, then why is it still on the market.” they asked. I thought that was a great question, and so decided to share my insight with everyone. 🙂
But first, let’s talk about target markets.
What is the Target Market for These Homes?
It may by that Mobile homes in parks don’t fit the normal “buyer” markets. If not, who is the right buyer?
A better fit for this very tiny home and other mobile homes in parks may actually be someone who is in the rental market. However, renters aren’t usually contemplating buying homes. Plus, mobile home parks typically require owner occupancy, eliminating tenants altogether. Or so it would seem. I’ll take a deeper dive into why I think tenants still may be a good target market for these homes later in this article.
Likewise, someone who wants to purchase a condo or townhouse, may want to consider a mobile home in a park. After all, these types of sales usually include paying monthly, quarterly, or yearly dues to an association. Instead, why not pay a mobile home park?
Why Hasn’t the Tiny Home Sold?
Back to my story. Let’s again consider why this home hasn’t sold. The person who asked me why the tiny home hadn’t sold was the parent of someone trying to relocate. The son was looking for a rental property. Determined to help, his parents were pitching in and trying to find a suitable, affordable home.
“He’s only planning on staying in California for a year.” the father confessed. “These California rentals are expensive!”
“Have you considered the tiny home in the mobile home park?,” I asked.
The parents asked how long the house had been on the market.
“About a month,” I offered.
“Isn’t that a long time?” one parent asked. “What’s wrong with it?”
Why hadn’t it sold? I wondered. That’s a fair question. “It is a one bedroom, tiny home. That is not appealing to many people.” I suggested.
“Also, buying a mobile home in a park is different than buying a home with land,” I explained. “The buyer purchases a home, but still has to pay rent for the space in which the home is located. They don’t actually own the land. That is not desirable to many buyers. They are in the purchase mindset and don’t want to consider renting the land.” The parents seemed satisfied with my answer, but they haven’t come to California to see the home yet. So, we will see…
Why Might Renters Consider Purchasing a Mobile Home in a Park?
As I mentioned earlier, rental clients may be surprisingly well suited to purchase a mobile home in a park. Why is this? Mainly, renters are already planning on being tenants. If however, they can save money on monthly rent, they win! Even better, if they can suddenly invest a portion of their monthly housing cost into a home they purchase, they win again!!! Perhaps, if more tenants understood the beauty of this type of purchase, they might be inclined to look through listings of mobile homes for sale.
Also, rentals are in extremely high demand. Because rentals are scarce, prices are expected to increase dramatically over the next few of years. Take a look at these numbers.
We manage a lot of properties for landlords and so we know rental prices first hand. Commonly, a three bedroom home in Cloverdale rents between $2,350 to $2,700 a month. Prices depend on amenities, size, location, services, yard space, number of bedrooms, number of bathrooms, attachment to other homes and allowance of pets. Conversely, a mobile home park’s space rent is currently no more than $1,000 a month in Cloverdale.
Happy Tenant Purchases Mobile Home in Park
For example, a tenant with $20,000 could feasibly purchase the tiny home mentioned above with a loan. The tenant, now a buyer, would sock away equity with the purchase, just as any homeowner would. Think of equity as money in a piggy bank. Only, the bank is the house. The buyer has $20,000 worth of savings in their new home.
Meanwhile, the homeowner pays the small loan quickly, adding value to the house “piggy bank” each month. Even though the buyer is paying a space rent, they are still building up their savings in the house. By the time the new buyer is ready to move out of the mobile home park and into conventional housing, they have even more equity, assuming the market is stable. They could then sell their house, take their savings, and place a sizeable down payment on a traditional home.
If this could be you, it’s time to talk with a lender. Unless, of course, you have cash to close. The home above will cost you nearly $100,000 by the time all of the closing costs are added into the equation.
Also, if you are looking for a mobile home in a mobile home park in Cloverdale, see the next section for current listings. Please note, only about 5 to 10 mobile homes in parks come up per year in Cloverdale. For that reason, you need to be ready with your financing.
Current Listings of Homes in Cloverdale Parks
Similar to Tenants of Rentals, New Owner’s Must Qualify with the Park
A tenant who can qualify for a rental with a property management company, will likely be able to qualify for a mobile home park. But, as I mentioned earlier, many mobile home parks require owner occupancy. What does that mean? Simple. It means, the person who occupies the home, must own it.
So what does the buyer need to expect when purchasing a mobile home in a park? First, they need to qualify for the park. The park management company may run credit and background on every proposed occupant 18 and over. Have your proof of income ready, along with your government ID. The manager will likely call all of your rental and employment references along with any other references you supply.
These Homes and Parks are Getting Upgraded
With all of the home improvement shows, you can see that homes are being renovated and updated all over the nation. Mobile homes are no different in this way. Many of these mobile homes are also looking better. What’s changing? A couple things actually:
- Owners are replacing old mobile homes with new modern manufactured homes.
- Owners are remodeling, updating, or fully renovating older mobile homes.
For instance, paint can make a tremendous difference in the appeal of a home both inside and out. Some owners are making simple changes, like changing out appliances. Some are covering old interior paneling with updated sheet rook and windows. Just as new fixtures can make a notable difference in traditional housing, it can have a similar affect on a mobile home.
Whatever the case may be, these homes may be worth looking into.
Cloverdale 7 Day Market Update