Are you looking at buying mobile homes to rent out? While it seems like a great investment opportunity, it’s important that you consider a few things before you get started. It’s not that we think renting out mobile homes is a bad idea. On the contrary, we think it could become a helpful and steady stream of income for you.
However, as with any business endeavor, it’s important that we each take a moment to weigh the facts before jumping in full force. That’s why we have a list for you of different important things to think about in this venture.
7 important things to consider before buying mobile homes to rent out
To be sure, this is not the most exhaustive list, but we hope it’s enough to help you figure out if this is something you’re called to do.
#1 – Property taxes can hurt
Buying mobile homes to rent out means owning property. Owning property means property taxes. This can be a painful surprise if you’re not expecting it. Do some research on what your location’s property taxes will look like for you. It may be a deal breaker if you’re not prepared to handle the expense. If it’s excessive, the cost in rent may not cover it, making the endeavor not worth your while.
#2 – Be prepared to deal with tenant damage
There are many horror stories of landlords coming to find the tenants have abruptly left the mobile home. And it’s not the abrupt disappearance that is found to be horrifying. But rather, it’s the condition the home is left in. Stories abound of tenants leaving the landlord with a trashed and destroyed home.
We’d like to think that you will be able to vet potential tenants, and thus avoid the people who would shamelessly damage your property. Otherwise, it can be a painful experience for any landlord.
#3 – Think about the location of your rental property
As you look at buying mobile homes to rent out, ask yourself if the property it will sit on is appealing. Remember the mantra of real estate agents? “Location, location, location”. Think about who would be interested in renting out your mobile home. Will the location be appealing to them?
#4 – Look for used mobile homes that could use some repairs
For the best deal in a used mobile home, you’ll probably find it in one that will require some handyman work. Don’t be shy about taking on such a project. There are many success stories of such homes providing a good return on your investment. You just need to know what to look for and what mistakes to avoid.
#5 – This can be a rewarding stream of income
As you look at the cons, don’t forget an important point. This investment can be highly rewarding. There are numerous success stories that prove this to be true. While we’d be foolish to say it’s a “get rich quick” scheme (it most definitely is not), we’d venture to say it can allow you to live comfortably.
#6 – Calculate the return on your investment
So if you’re leaning in the direction of going for it, you’ll want to first calculate the return on your investment. It’s important to know if this will be worthwhile before you’re committed.
Over at biggerpockets.com, you’ll find a helpful method to crunch rental property numbers easily. This will give you a clear picture of what to expect on your investment strategy results.
This is very important and it’s too big of a deal to skip out on.
#7 – Basic conflict management skills are a must
Finally, you need to think about the fact that you’ll be dealing with people. And even the most easy-going of persons will find themselves in conflict-charged situations. If you don’t feel up to the challenges that may arise in landlord-tenant conflicts, don’t give up so easily. You can hire a manager to deal with your tenants one-on-one or you can rise up to the challenge.
Always remember, show respect. Listen carefully. And show that you care. Even if you and your tenant do not come to an agreement in a conflict, you’ll sleep better at night knowing you handled your end with maturity.
Make a good plan out of your future investment!
Now that you have some things to chew on before buying mobile homes to rent out, you’re in a good place to make a decision that’s best for you.
As you shop around for the perfect used mobile home to invest in, have you considered attending a mobile home auction? We have a few tips on how to score a great deal.