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Best Practices when Investing In Mobile Homes

By Charles Hopkins Published 05/24/2007 | Entrepreneur

Investing in mobile homes can be a highly profitable business. It is also a business with somewhat high risks, making the average real estate investor nervous. This is a good thing for the investor that will take the time to educate themselves about the risks involved in this type of investing. When risks are managed fortunes are often made.

In order to make money in mobile home investing, you have to be prepared to make sometimes ridiculous offers on these homes. If your first offer isn't low enough to embarrass you, it is probably too high. This is an important thing to remember and will make you thousands of dollars.

Never buy a home that the owner doesn't have the title to. Mobile homes are generally like cars, and have titles instead of deeds. Always ask about the title and if the owner doesn't have one for the home, move on to the next prospect.

Always make sure the home can stay in the park it is currently located in. Moving mobile homes is generally too costly and time consuming in most cases. The best way to find out if the home can stay in the park is to ask the park manager.

The mobile home park manager can be a powerful ally to the mobile home investor. If you really want to know the story behind a home, ask the park manager. Make friends with the manager by taking her out to lunch or dinner, and discussing your investing plans in the park. Without the manager's approval, doing business in the park will be nearly impossible.

Do not buy homes that have bad roofs. Mobile home roofs are often very difficult and costly to have repaired. The return on investment on a mobile home with a bad roof will be diminished greatly. Walk away from a deal like this unless the price is right.

Free homes are not always the best choice. Often a park manager will offer to give an investor a few homes in the park for free. It is in the best interest for the park to have nice homes to collect lot rent on. Be cautious because these "free" homes usually need extensive repairs that are often too costly and time consuming. Remember high repair costs diminish the return on your investment.

Try to partner up with a person that will do the mobile home repairs for you in exchange for a percentage of the profits. Usually the investor will buy the home and the materials to repair it, and the handy person will do the work and sell the home. People really like to buy homes that have been recently remodeled and repaired.

Investing in mobile homes can be very profitable when done properly. You can buy homes starting from a few hundred dollars and resell for thousands more. Many investors finance their homes for the new buyers. By doing this at even a modest interest rate you can receive income from the sale of the mobile home for many years.