Wholesaling Houses vs Mobile Homes (HA 1252)
Wholesaling Houses vs Mobile Homes (HA 1252)
Transcript:
Steven Butala: Steven and Jill here.
Jill DeWit: Guten tag.
Steven Butala: Welcome to the House Academy Show, entertaining real estate investment talk. I’m Steven Jack Butala.
Jill DeWit: I’m Jill DeWit broadcasting from sunny, southern California.
Steven Butala: Today Jill and I talk about wholesaling houses versus wholesaling mobile homes.
Jill DeWit: I have a lot of questions.
Steven Butala: Go ahead.
Jill DeWit: I will have a lot of questions. The scene, is it more different or more similar than we think?
Steven Butala: It is more similar but you know what the secret is here?
Jill DeWit: I’d love to know.
Steven Butala: It’s how to identify these properties using data so that you can send out a real specific mailer. Because sending out, it’s like a hybrid, mobile homes are like a hybrid between land and houses. It takes a little bit of information and finesse to get the correct mailer in the mail to yield results. It’s not really a land mailer, it’s not really a house mailer but it works.
Jill DeWit: I would like to know how you’re doing it, so we’ll get into this one for sure.
Steven Butala: Before we get into it, let’s take a question posted by one of our members on the houseacademy.com online community, it’s free.
Jill DeWit: Ellie asks, “How can you find mobile home property that is owned and not lease like in a mobile home park?”
Steven Butala: Okay, so she’s saying… Do you think it’s a she? I think she is.
Jill DeWit: I think it is.
Steven Butala: She’s asking the very essence, so this is exactly what this is all about. In fact, let’s get into right now. Today’s topic, wholesaling houses versus mobile homes, this is why you’re listening.
Jill DeWit: Give us the mobile home background and what everyone needs to know.
Steven Butala: Okay, great. We all know houses, stick built houses and you can visualize one. Mobile homes are a little bit more complicated but incredibly profitable and it’s actually worth learning. There’s several types of mobile homes, there are the kind that are in a mobile home park where you own the mobile home as the resident but you lease the land, usually, 300 or 400 bucks a month sometimes, maybe sometimes less. You pay for utilities and the whole thing just like you would with a house. There are mobile homes where in a park just like you can picture what I just described but you actually own that postage stamp sized piece of property, those are not that common, but they exist. Then there’s a mobile homes that we all love as investors where it’s an acre property or it’s in a community but it’s all been subdivided the same way a regular house subdivision would be done, but they allow them for mobile homes.
Steven Butala: Everybody wins here because the mobile home owner gets to live in a house that’s incredibly inexpensive to live in, very affordable, and they get the benefits of owning land which is in the tax benefits. It’s usually from a property tax standpoint, much more affordable to live there. Mobile homes for us as investors are great things to get into in mobile homeland specifically because it’s so much more affordable and therefore so much more sellable.
Jill DeWit: How do you seek out and find the individual types?
Steven Butala: There’s two ways, this a great question, a mobile home park where they just rent spaces to people who own mobile homes is one APN and it’ll be zoned that way. If you’re looking at a huge amount of data in DataTree or in RealQuest or wherever, you’re looking for something that’s designated or zoned as mobile home park. Check, you don’t want to do that, unless you’re a mobile home investor and that’s fine, mobile home park investor. We’re done with that. You’ll see for mobile, the second type that I described where there’s a tiny little postage stamp, APNs, you’ll see a lot of different mobile home APNs with a very specific designation for zoning in a data set. That’s one way. If you’re a spatial person like me, it’s really easy to go on realtor.com or redfin.com and horse round and click around until you find a bunch of mobile homes for sale and see which kind they are, there.
Steven Butala: Now you’ve got a couple of zip codes you can work with, and so you’re like a private investigator. You have to research it, you got a few zip codes to work with, now you can go into DataTree or RealQuest whatever you prefer. And take a look at these zip codes and the specific zoning types and you’ll see that there’s usually just one zoning type, and then research a few. Boom, you’ve got yourself a mailer.
Jill DeWit: I would like to interject something there real quick.
Steven Butala: Yeah.
Jill DeWit: Welcome to my world because this is what happens. He goes in his office to do some research and he comes out three days later, and this is what’s going on. You either love this, you either love the investigative part, you love this research part, you love. Traditionally, you’re here because you love something about this business.
Steven Butala: I love this part.
Jill DeWit: That’s the thing, and then that’s what you love the most, isn’t that funny? I like getting the purchased and done and, in our inventory, the sales I could care less about, but you think I would love it because I’m a salesperson just by birth. But I know how it’s going to play out because I know how we by them. But it’s so funny that so just explaining who you are and what goes on to this, you make it sound easy, Steven, by the way, but for some people it’s not that easy. But you can figure this out too, so thank you.
Steven Butala: Yeah, and then you want to send a mailer so that what’s the difference between wholesaling houses and mobile homes? Now the mailers in and you’ve got this data set, let’s say of two or three zip codes and you know which properties are you just hone your data set down into just mobile home properties that have land that’s associated with it. Really your data set doesn’t even include the actual mobile homes because that’s not real estate, it’s a legal equivalent to a car. You don’t really know if these properties have mobile homes on them or not. It’s actually I think we talked about this earlier this week, or maybe it was on the other show. You won’t have a choice. You have to really send out a mailer and you have to decide how you want to price it. I always price it as if there no mobile home on there at all. It was just the dirt and it’s mobile home ready to build.
Steven Butala: That seems to work great because chances are there’s some really old mobile homes where you’re sending this mail to and that’s who’s going to respond. If somebody’s already got there and took a mobile home off, wiped it clean and put a new one on there, they’re either going to not respond your mail or they’re going to say, “Man, you’re way off.” I just did what you’re probably trying to do.
Jill DeWit: Exactly.
Steven Butala: That’s really my end comment here is, is the end game for you is to either flip that piece of land to somebody who’s going to drop a new mobile home on there or do it yourself. Now, you could as an investor with this House Academy Program become a very profitable and simple version of a developer. It’s too easy to knock an old mobile home off of its foundation and drop a new one on there with no zoning changes, a couple of permit requirements, and so getting to know a mobile home dealer themselves.
Jill DeWit: Based on this topic, wholesaling houses versus mobile homes, which do you like better?
Steven Butala: I like a combination of both. I’ll tell you the average price on the mobile home deal that I described is a lot, average profit margin is can be 50 to 80,000 bucks in the right market. But there’s a lot more moving parts, you need to have contractors that are involved in stuff, so it’s not… After you’ve done a wholesale successfully as an investor, resold a bunch of houses to somebody whether they’re a landlord or a flipper or a renovator, I think it would be logical to explore mobile homes but I wouldn’t start out of the box with that at all.
Jill DeWit: Exactly, thank you.
Steven Butala: Hey, we know your time’s valuable, thanks for spending with us today. Join us next time for another interesting episode.
Jill DeWit: We answer your question, is posted on our online community at houseacademy.com, it is free.
Steven Butala: You’re not alone in your real estate ambition.
Jill DeWit: That was good.
Steven Butala: Good.
Jill DeWit: Good Friday, good shows, good week, I’m glad.
Steven Butala: Yeah, exactly.
Jill DeWit: We’re finding our groove, it’s good, and again, I really want your feedback so please let us know what you like, what you don’t like, what you want more, what you want less of, and if you have a question of course put it in our online community. Most, importantly, wherever you are listening or wherever you’re watching, please subscribe and rate us there. We are Steven and Jill.
Steven Butala: We are Steven and Jill. Information-
Jill DeWit: And inspiration-
Steven Butala: … to buy undervalued property.
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