Duties and Responsibilities of a Mobile Home Community Owner Pt.1
Updated: 7 days ago
A lot of mobile home community (MHC) owners end up making an enormous mistake:
They think that their duties and responsibilities end after hiring an effective manager.
All that’s left is to check whether or not the manager has successfully collected the monthly rent or not, right?
Mobile home communities run in this manner are eventually run into the ground, and the reason why is simple: No matter how efficient managers are, they take their cue from the owners.
If the owner is not interested in anything besides rent and keeping the day-to-day operation running, that's what the managers will do, too. They will not seek the growth of the park or community or making it as desirable for new tenants as possible.
On the other hand, if MHC owners understand their ethical and legal duties and responsibilities, then the community will grow, and with it, their profits.
1. Find a Good Manager
Your manager is your representative in the park.
They are not the filter that is supposed to keep the day-to-day problems from reaching you, and neither are they glorified rent collectors.
The manager is supposed to keep the park running. That means taking care of EVERYTHING in the park, including functioning utilities, well-kept amenities, up-keep of the park rules, and the security and safety of the park’s residents.
In a lot of cases, the best managers are found within the tenants of the community. But make sure their loyalty is well balanced between you and the tenants.
Please read more about finding a good MHC manager here.
2. Refurbish The Park, Then Mobile Homes
When you acquire a park, prioritize refurbishing the common areas.
Get the roads fixed, trees trimmed, grass cut, lights fixed.
If the park is gated and walled, make sure there aren't any illegal entry and exit ways.
Setting up a good manager's office is also vital because that is the first thing that any prospective tenant might notice.
Once you are done with your part of the job, then you can get your tenants to revamp their mobile homes. You can aid them by providing those services, and then adding the charges to their monthly rent.
3. Gradually Raise The Rent
An unhealthy trend that is seen in many mobile home acquisitions is that the new owners jack up the price as soon as they take hold.
That approach might work for a conglomerate that is running ten parks because even if they drive half the tenants out from one park, their revenue stream won't shrink that much.
However, if you only have a stake in a small amount of communities, you might have a hard time earning profits if a quarter of the lots are suddenly empty.
So, even if you have to raise the rent to match the market, do so gradually. Give your tenants enough time to adjust to the change.
You can also make other arrangements, like a reduced management fee if they help you in maintaining the common park areas.
4. Stay Connected To The Experts
In any mobile home park, especially old ones, some people know the area inside out.
They may be former managers or tenants, or even previous owners.
Staying on good terms with such people will help you figure out your community’s “hacks.”
They will also know important stuff that you won't find in the community's documents and maps. For example, the location of the water main safety valve or the most commonly clogged sewerage area.
This kind of information can save you a lot of money and hassle.
Following the advice above will save you valuable time as a mobile home community owner. Not only will you benefit from running a tight ship, but so will your management and tenants.
This post is part one of two, and I will be posting the second portion with even more duties of MHC owners next week.
Please feel free to contact me with any questions at email@example.com.
-Virgil Nethercott, CCIM
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