As any real estate investor knows, it is important to have a varied portfolio. By investing in single-family homes, multi-family properties and unique niches, such as mobile home investment, you will be able to generate income no matter what is happening in the market. In our latest post, we discuss how purchasing mobile homes can help you to vary your portfolio, helping you see great profits overall!
Mobile home investment in Chicago is hotter than ever. With more people jumping onboard the housing trend, mobile home parks are being seen in a new light. No longer is it just about the cost, it is also about living a more minimalist lifestyle. People are choosing simpler lifestyles, with fewer materialist items to weigh them down.
Mobile home investment is typically much more affordable than a single-family or multi-family investment. Mobile homes are much less expensive to construct, making the price to purchase considerably less. It can be the perfect way to get started with real estate investment. In addition, the costs of repairs and maintenance for a Chicago mobile home are usually much less than the repairs and maintenance needed for a site-built property. The smaller space, makes heating and cooling costs much more affordable too, especially with the energy efficient mobile homes being built in recent years. Many people are finding mobile homes to be more economical in many ways, and much simpler to maintain.
Buying In Bulk
One strategy mobile home investors employ is to purchase multiple mobile homes at once. For the price of one single family house, you can purchase at least two mobile homes, if not more. This gives you more income streams and better protection when tenants move out. The likelihood of all your tenants moving out at once is low, which means you will always have money coming in, whether you are dealing with a vacancy or not. Buying multiple properties in the same park will help to make inspections and repairs easier than having to drive over town to visit multiple properties.
Flipping Mobile Homes
Instead of renting them out, some investors will choose to flip. As mentioned above, the costs to purchase and repair are much more affordable than a single-family home. This can make flipping an excellent way to generate extra income. Before you decide to do this, however, make sure you are familiar with the different sorts of repairs that may be required. Mobile home owners face different kinds of repairs than other homeowners might. When you are making repairs to mobile homes, you will need to consider many things such as flooring issues, skirting problems, damage to the siding, and problems with winterization. Moisture issues can be a big problem with mobile homes.
Consider Investing In Parks Themselves
After learning the ins and outs of mobile home investment, many investors will set their sights on owning the mobile home park itself. The overhead is typically pretty low, and most well-maintained parks stay pretty full. The lot rents you collect each month will more than pay for the price of the land. Of course, you will likely want to add some improvements to the land. Adding amenities to the park such as a pool or clubhouse will attract more residents to your park. Zoning can be a challenge, but once you get through it all, the reward can be very profitable.
Things To Watch Out For
Just like an automobile, a mobile home will generally depreciate over time. This isn’t always the case as mobile homes are rising in popularity, but owners can’t bank on reselling for a tremendous profit. That said if you own the land underneath your property, that will likely appreciate over time.
Another thing to watch out for is turn-over. In some cases, a low-income tenant may have trouble paying the rent. This can be avoided by properly screening all prospective tenants before letting anyone move in, making sure their income and employment history aren’t going to be a problem. You can also avoid tenant turnover by making sure the mobile home remains a desirable place to live. Make all repairs in a timely fashion. Make sure the exterior areas remain well-maintained and even add some beautification projects into the mix to give the place greater curb appeal.
Overall, investing in Chicago mobile homes is an excellent way to diversify your portfolio. As the market for these types of properties increases, so do the potential profits. With mobile home investment, almost anyone is able to get started for a relatively small amount of money upfront. At Chicago Home Buyers we can provide you with all the details so you can find and purchase the right mobile home in the Chicago area.