There are many benefits to manufactured home investment an investor should think about when adding to their portfolio. In our latest post, we will discuss some of the ways you can use mobile home investment to build wealth in Chicago.
Many real estate investors will stick to the basics: single-family homes, multi-family homes, apartment buildings, or commercial space. However, there are many investors making great money out there because they have found a certain niche. One great niche to explore is mobile home investment. It can be easy to get started, with much less risk than a traditional property. Keep reading to learn more about the benefits of manufactured home investment in Chicago and the surrounding areas.
Manufactured homes cost much less to build than your average single-family home. As such, they are usually priced at least 50% less than a comparable single-family property. In addition to a lower purchase price, it will usually cost much less to make repairs. If you choose to make upgrades to your mobile home, there are several low-cost improvements you can make that add value. Some of these include pressure washing, new carpets, and repainting. Overall, the amount you spend on your mobile home investment will be much less. Buying two mobile homes instead of one single-family property will help make sure you always have income generated, even if you are dealing with a vacancy.
The low cost will also help to lower your risk. Many deals on mobile homes are done in cash as opposed to bank financing. This helps to ensure the sale won’t be canceled at the last minute by the lender which is often the reason why home sales fall through. Plus, with less investment in the property, the less you have to lose. The trick to making money here is volume. Once you have a few properties under your belt, you can expect a strong and steady income flow.
The fact is, there is always going to be a market of people looking for affordable housing. In today’s economy, more and more people are looking for an affordable place to live. There is often some concern about long-term tenancy when renting out a mobile home. However, with more and more people opting for a smaller home, mobile homes are looking more appealing to many renters. When the appearance is kept nice, the curb appeal maximized, and the park the home is in is of high quality, you won’t have any trouble finding high-quality, long-term tenants. In fact, when done right, a mobile home can be seen as a trendy place to live with the younger demographics entering today’s real estate market. Many parks are located in great areas, with amenities such as pools, playgrounds, or rec rooms.
There is more to a mobile home than just being a single wide or a double wide. Nowadays, mobile homes are built with all kinds of floor plans and amenities. Full kitchens, energy efficient elements, patios, and walk-in closets can all be found in mobile homes these days. No matter what you are looking for, you will be able to find it in a mobile home.
What To Watch Out For
Of course, as with any real estate transaction, there are things to watch out for too. In many cases, the mobile home will be subject to depreciation, just as a car would be. However, there are cases where the homes increase in value, but it isn’t always the case. However, if the land is owned with the mobile home, it will appreciate over time.
Another thing to keep your eye on is the appearance of the mobile home and the park in which it resides. To attract the right renters, take some time to make the place inviting, welcoming, and comfortable Capitalize on the small home trend by adding the right touches to the property. Small touches such as ornate trim, shutters, flowers, and new fixtures can all increase interest and secured tenancy.
If you are investing in a mobile home located on leased land, be sure you understand the rules, regulations, and fee structure. Develop a good relationship with the park manager to help make sure any concerns you have are addressed. Beware that lot fees can change, dramatically, so be prepared to alter your investment plan if needed.
A mobile home owner will face different kinds of repairs than the owner of a single-family property owner would. Mobile home skirting is the panels that cover the space between the home and the ground. This will provide insulation and protect your home from pests. Another thing you might run into repair-wise is a problem with the floor. Bent floorboards and soft spots can lead to holes. Most floors are made of wood and can be easily fixed with water-resistant plywood.