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Mobile Home Park Valuations: What is a Mobile Home Park Valuation?

Mobile Home Park Valuation 101

I want to talk about Mobile Home Park Valuations. This term is used to refer to the value of a Mobile Home Park, also known as Real Estate or Real Property. Mobile Home Park Properties are defined as properties that are purchased and then occupied by the owner. Mobile Home Owners are the ones that rent, lease buy, and live in their Mobile Home Parks.

Earlier this year two Mobile Home Park owners in South Carolina had found out the hard way that Mobile Home Park Properties do not perform as a good investment. Let me explain. Mr.orage and Mr. Phillips were contemplating buying a park that was cited for failure to pay fees and fines and had a prior lien placed on it. The problem was that the amount stated for delinquent fees and projected tax revenues were not available until June of ’04.

Fortunately, the South Carolina Mobile Home Owners saw the error of their ways and filed notice of their intent to foreclose on the properties with the procedures of the remaining Mobile Home Park owners. Mr. Trigger and Mr. Pretty had saved their mobile home parks from disaster only because they had performed their research.

What is a Mobile Home Park?

Most people think that a Mobile Home Park is some type of mobile home community. However, it is much more then that. Mobile Home Parks are an investment that has the ability to perform a variety of tasks. In fact, almost every mobile home park performs many functions.

Both mobile home park owners and investors live in a mobile home park.

Mobile Home Owners

Mortgage providers, like the banks that finance single family homes, will finance mobile homes as well. If a mobile home is being purchased they will normally provide a line of credit equal to the balance of the price paid for the mobile home. In this case the collateral for the loan is the mobile home park where the home is located. This will enable the Mobile Home Owner to borrow or refinance funds in order to purchase their home.

The Mobile Home Owner whether this will be someone who is buying their very first mobile home or is an established mobile home owner will have the ability to purchase enough land on which to finance their home. Because these types of parks are purchased with a line of credit or hard money this allows the Mobile Home Owner to withdraw funds necessary to fund the purchase, until all the financing is complete theMobile Home Owner can enjoy the benefits of having their own home. 

Just expect that the banks will only lend anywhere from 80% to 90% of the appraised value or purchase price of the mobile home. The remaining 20% will be loaned by a private, often a family, third party that specializes in funds transfer.

The banks offer mobile home park financing and 100% loan to value mobile home parks are extremely rare.


Many mobile home owners choose to purchase their homes with funding provided by the investor. This is what is known as a Residential Loan, normally managed by a Professional Marketing Organization.

The purpose of the professional organization is to market the residential mortgage to a wide variety of different investors. Often the potential investor will seek a deal that is able to attract various investors. They are attempting to capture investors to be their customers and offer the investor a vehicle to complete the loan transaction. An example of this is a rent to own program.

Here are some uses for theses types of programs:

Use one different type of investor, a private Hard Money Lender, then provide them with another type of investment vehicle. All the Investors, the buyers and buyers agents, receive a commission and the Hard Money Lender (Dist investor) gets their money back with the terms of the transaction they supply.

However, the Real Estate is often purchased using an “All Cash” deal which, under normal market conditions, allows the investor to simply flip the property to a potential buyer without having to qualify for a loan or having to show income.

Advertise the Residential Loan for sale to obtain a large amount of buyers to buy the property. This is similar to an auction, and typically these types of sales will involve around 10-20 potential investors using various price points. The original Hard Money Lender gets their money, the original investor receives 10-50% of the outstanding balance on the loan(s) Related to this, the investor can earn inflationary returns on the money. At 6%+ HDCredit, it is not unheard of for investors to earn 12-18% on a loan. Using this method, the investor-Hard Money Lender, never has to show its income, nor does the investor have to qualify for the loan

Create a Lease/Purchase option:This is when the investor leases the property to the tenant with the option to purchase it at a future date, usually 3-5 years in the future.

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