As real estate investors, it’s Kim’s and my responsibility to find, structure, close and manage our properties.
Last week, we put together our first mobile home park (MHP) deal.
In putting together the MHP deal, we were often reminded of when we bought our first rental house.
Our quest began three years ago. Our friends, Brad and Cindy Simmons from Kentucky, owned several MHPs. I asked them why they would be crazy enough to own a park. They said that, when managed properly, MHPs were cash cows. This got us interested in learning more.
Instead of jumping in and buying a park, we knew it was critical to first do our homework!
Step One: I was asked to join The Trailer Park Kings. I was asked to join because of my ability to creatively structure and fund win-win real estate investing deals, not because of my limited knowledge about mobile home parks. The members included David Protiva, Mark Titshaw and Chuck Meek. All are experienced park owners. The group meets monthly to discuss MHPs. Bottom Line: I met face-to-face with other like-minded investors.
Step Two: I read every book Lonnie (Lonnie Deals) Scruggs wrote (LonnieScruggs.net). I also bought Dyches Boddiford’s courses (assets101.com), Mobile Home Money Machine and Deals in Dirt. Bottom Line: I got educated.
Step Three: I began driving through every MHP in Bartow and Gordon County. I talked to the residents as well as the park managers. Bottom Line: I wanted to make sure – by seeing things up close – that owning a park was really the right move for Kim and me.
Step Four: Whenever a park went up for sale in our target area, we met with the owner to ask Pete Fortunato’s famous question: “Why are you selling this wonderful park?” From Pete’s question, we learned the seller’s asking price, motivation for selling, the condition of the park, etc. Bottom Line: We learned how to determine a park’s value.
Step Five: We began, after first doing our due diligence, making offers on MHPs. Even though our offers were rejected, we didn’t quit. Bottom Line: Failure didn’t deter us from our firmly-rooted goal – to buy a park.
Step Six: Finally, after a three-year learning process, our offer on a park was accepted! We closed on this deal several weeks ago. Bottom Line: After making an offer, doing our due diligence, and having our offer accepted, we didn’t get cold feet or get consumed with thoughts of failure. Because of steps one through five, we were confident that it was a good deal and we moved forward.
Please realize that we didn’t wake up one morning, decide to buy a park, push a button, and BLAM! we owned a park. Instead, we set a goal, met with other like-minded investors, got educated, met with sellers, began making offers, and when we found a park that worked for us, WE TOOK ACTION!
Hope this helps you to do your first deal.
Do you seek real-world real estate investing information? Go to BillandKimCook.com. It’s packed with free creative deal structuring techniques and strategies. Bill and Kim Cook have been investing in real estate since 1995. Their portfolio consists of single-family rentals, a small mobile home park, plus notes and options. If you have questions, give Bill a call at 770-815-8727.
