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14 Lot MHP with POH's - Outside of Nashville

Multi Family Housing for Sale in Smithville, Tennessee

920 Short Mountain Street
Smithville, TN 37166

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Mobile Home Park for Sale

Number of MH Lots: 14
Size: 1.5 acre(s)
Cap Rate: 11.7%
Purchase Method: Cash, New Loan
Status: Sold
Property ID: 823335
Posted on: Jun 16, 2017
Updated on: Sep 16, 2017

Property Description

**** Update 7/28 - Pending contract, accepting reasonable backup offers at this time ****

Located about 60 east of Nashville off I-40. Cap rate between 11-12% See calculation sheet for Valuation and Equity for 6-8% market cap attached. City Utilities, All Electric Units!

Gross Profit since Oct 2014 to May 2017 equals $135,446, Net Operating Income equals $58,398 over this time frame. Driving by is welcome but please do not disturb tenants. Meetings with owner or manager by appointment. Offers accepted with proof of financing. For sale by owner but sorry, owner financing is not available.

Serious inquiries only please, I'm getting a lot of calls requesting further information when I've listed a ton of information. I prefer email with a list of your specific questions or requests versus asking me to call for further information. If you are serious we can speak via phone and set up a time to view the park. If you call anyway, you will need to leave a message clearly stating your name and phone number. No calls after 10 PM CST.

The mobile home park has 10 park owned units (100% occupancy rate) with the possibility to expand back to 14 (plumbing and electric in place already ready for new units) and city is ok to expand just apply for permit to add homes back. I had originally listed 15 lots, but during a showing it was pointed out that the utilities were in place for 4 not 5 extra, (two of my maintenance guys told me that they found utilities for two units on one lot and previous owner was unsure since she didn't have utility plans available to verify). It's in a small city approx 60 miles east of Nashville to the east in Dekalb Co, TN, off I-40 with stable economy, and has city water, sewer, and electric. Trash and trash cans are provided by the city within the coming month. All units are park owned and rent for $450-575, we have weekly, bi-weekly and monthly renters currently. We charge a non-refundable cleaning and application fee up front before move-in. Rents can be increased and extra 4 lots can be rented for approximately $250+ each and city will let you add more units with permit, however park has always operated as a POH home rental park versus lot rental park. To get permit, you apply with City Manager and go before the city council to ask to have homes put back on the 4 lots. The previous owner removed them thinking they were too old versus a cost effective rehab. I've chosen not to put homes back on the lots because I'm owner financed and the own can put lien on homes until I pay off mortgage thereby if I default, I've lost my investment in the new homes.

If you are familiar with mobile homes they can be rehabbed quickly and effectively with little capital investment. Homes in this park are lived in and have seen better days but I would consider them in fair to good condition compared to many mobile home parks with the age of the homes. The big units have tile throughout.

The current units are late 80's through early 00's models and all are electric heat/air. Most months the units are 100% rented. Park can easily be weekly or monthly. Stays full, good rental market. Longest a unit goes unrented is 1 month if not actively recruiting tenants. The only expenses are insurance, maintenance, the one park security light, mowing, and a manager, if desired. All utilities paid by tenants, the electric is on a prepaid plan. The water includes sewer and water. The city provides trash pickup and the fee is included in the county/city property taxes. Many of our tenants work for the car parts manufacturers in the area. We have always had a mix of those, social security, and local fast food workers. Park is located near a housing area on one right side, forrest in back, and a church's field on the left side. Located on a 2 lane highway.

Unit 1 - 14x60 (early 80's) - recently rehabbed to livable status in 2015, previous rent of $250, starting July $350 - 3 beds 1 bath Unit 2 - 16X80 - 1997 - $525 - 2 beds 2 bath Unit 3 - 14X60 - Late 80's - $475 - 2 beds 2 bath Unit 4 - 16X80 - 1995 - $550 - 2 beds 2 bath Unit 5 - 14X70 - 1997 - $ $550 - 3 beds 2 bath Unit 6 - Empty Lot (can hold 16X80) $250 lot rent - empty now Unit 7 - 16X80 - 1999 - $525 - 2 beds 2 bath Unit 8 - Empty Lot (can hold 14X70 or 16X80) - $250 lot rent - empty now Unit 8 - Empty Lot (can hold 14X70 or 16X80) - $250 lot rent - empty now Unit 10 - 14X70 - 1992 - $520 - 2 beds 2 bath, handicap accessible ramp Unit 11 - 16X60 - 1995 - $550, can be raised to $575 - 2 beds 1 bath Unit 12 - 14X70 - 1995 - $460, can be raised to $525 - 3 beds 2 bath Unit 13 - Empty Lot (can hold 14X70 or 16X70, 16X80) - $250 lot rent - empty now Unit 14 - 16X60 - 1997 - $425, can be raised to $475 - 2 beds 1 bath Storage building is 16x24 I believe

Tenants pay utilities for water (includes sewer) and electric on prepaid plan Utility light $15/month City Taxes 2016 $800/yr 2016 County Taxes $700.00/yr Mowing $80/wk in summer Foremost insurance $500k property damage $225/mo, $1 mil liability, Bus/E&O $42/mo Manager $1,000/mo (manager in place, lives 5 minutes away, willing to stay on, pay can be reduced) Maintenance $ varies per month (maintenance in place for any needed repairs, lives off-site but very, very reasonable, also have relationship with several local HVAC outfits that are reasonable) I get a lot of questions about maintenance, several of the homes (3) have window AC units. We keep between 8-10 window units and 10+ heaters in the shed in case of emergencies. We've had HVAC callouts on same units several times and elected to put window units, also stray cats have pulled down ductwork in the oldest unit (unit 1). We've been replacing porches and decks as we can. A few roofs need cool sealed, we planned to do this past spring but the weather had been too wet. Mostly, we have normal issues of sink or toilet leaks. The park is older and we fix issues as we go, along with repairs for tenant damage. Many of the bigger units have had new tile laid in throughout. The partially paved road has a few pot holes or indentions. The right owner can make a lot of improvements and see a nice return.

Information on the area:

Information on Smithville, Dekalb Co, Tennessee. Zip codes: 37166. Population in 2014: 4,661 (88% urban, 12% rural). Population change since 2000: +16.7% Males: 2,209 (47.4%) Females: 2,452 (52.6%) Median resident age: 40.8 years Tennessee median age: 38.7 years

Estimated median household income in 2015: $32,853 (it was $22,482 in 2000) Estimated per capita income in 2015: $25,366 (it was $16,854 in 2000) Estimated median house or condo value in 2015: $116,686 (it was $72,700 in 2000) Median gross rent in 2015: $514.

Production occupations (32%) Management occupations (15%) Construction and extraction occupations (11%) Material moving occupations (9%) Building and grounds cleaning and maintenance occupations (9%) Office and administrative support occupations (9%) Sales and related occupations (5%)

High school or higher: 75.8% Bachelor's degree or higher: 14.6% Graduate or professional degree: 4.9% Unemployed: 7.7% Mean travel time to work (commute): 15.6 minutes

Largest Employers located in Smithville: Auto Parts Manufacturing: Federal Mogul Friction, SHIROKI North America, Inc., Tenneco, Inc., Foutch Industries, LLC, AAA Coating Ovens, Toasters, and Grills: Star Manufacturing Cabinet Makers: Smithport Cabinetry, Regal Craft, Architectural Custom Cabinetry Apparel: Omega Apparel Other: Norvell Body Invest, Industrial Machine, Goggin Warehousing, Walmart, Retail and fast food Agriculture: Several large nurseries, tree farms, and plant growing facilities located near Smithville service Lowe's and Home Depot for the Southern US.

Closest cities: Sparta, McMinnville, Cookeville, Lebanon. Nearest city with pop. 50,000+: Murfreesboro, TN (32.9 miles , pop. 68,816). Nearest city with pop. 200,000+: Nashville-Davidson, TN (54.4 miles , pop. 545,524). Smithville is located near a large recreational lake and dam.

What have I accomplished in this park? When I bought the park it had a bad reputation and was known for having "trap" houses, places for selling drugs. The first few months we evicted 8 or the 10 units and started over. We were able to clean up the park and turn it into a family friendly park. It was hard but we've made a lot of progress in 3 years. The right owner could really make this park a pillar of the community. Smithville doesn't have enough rental units and demand for family housing is big.

Why am I selling? I'm selling for family reasons that are not related to the park. I can go into further detail later with serious buyers. The park is now has a good reputation and in demand.

Evictions: We have had evictions while I've owned the MHP but never had to take anyone to court. We do not fall under any special laws in Tennessee for metro areas (certain additional criteria for evictions). We are able to give weekly's a 10 day notice and monthly's a 30 day notice. Evicted tenants tend to leave within the 30 days or abandon pretty quickly after not paying rent. Our rental agreements are strict and list if you make us evicted you and go to court, you will pay all our court costs attorney fees, damages, etc, in addition to theirs, so they just leave. We do normally have a trash out of clothes and/or furniture left behind, but there is a free trash dump a few miles from the park.

Deposits: We do not charge deposits, we charge an application fee and cleaning fee up front when a new tenant comes in. These are non-refundable.

Lawsuits: There are no pending lawsuits or legal issues. We have not had any insurance claims on this park since we've owned it.

Titles: The titles are in our name but they have a lien until the mortgage is paid. This is why I also didn't bring in homes for the empty lots where I could loose my investment if I defaulted.

Please send your questions via email with specific questions if I haven't addressed something. I'll update this post as I get common questions as well. Thank you!

Location Description

Approx 60 Miles east of Nashville, TN, on I-40 in Dekalb County. Mobile home located near center of town of Smithville.

Park Information

Number of MH Lots:14
Total Occupancy:71.4%
Year Built:1979
Average MH Lot Rent: $250
Size:1.5 acre(s)

Financial Information (Pro Forma)

Gross Income$52,267
Operating Expense$19,212
Net Operating Income$33,055
Expense Ratio 36.8%
Debt InfoOwner Financed, Not Assumable

Lot Information

Singlewide Lots:14

Utility Information

Water Paid By: Tenant - Individual Service

Park-Owned Homes

Number of Park-owned Homes:10
Average Rent for Park-owned Homes: $500

Amenities and Other

Storage: Yes
Handicap Accessible: Yes

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