Why Mobile Home Rentals? Get Past The Prejudice And Look At The Numbers. In Our Town, For Example, A Two Bedroom House Costs 130,000 And Rents For 800month. A 50,000 Mobile Home On Real Estate Gets 500month. Cash-on-cash Return On Investment Is Obviously Higher With Mobile Homes.Don't Let The Half-truth That Mobiles Depreciate In Value Keep You From Investing In Them. They Lose Value In A Park, On A Rented Lot, But Not On Real Estate. My First Home Was A Mobile, Bought For 19,000 And Sold For 45,000 Fourteen Years Later.House Rentals Here Usually Have Negative Cash Flow, While Mobile Home Rentals Have Some Cash Flow. Still, Investors Prefer Houses, Believing They'll Build Equity Faster, But Is That True? Only During Times Of Fast Appreciation.BEquity Building With Mobile Home RentalsBBuy A House For 120,00 With 20,000 Down, And Take Out A 100,000, 6, 30-year Mortgage. You'll Have A Payment Of 599.60. Of The First Payment, 500 Will Go To Interest, And 99.60 To Principal. You Only Built Equity Of 99.60. This Ignores Appreciation, But Only For The Moment.Second Scenario: Find A Mobile Home For Sale On Land, And Borrow 30,000, At 8, Amortised Over 10 Years. Higher Interest And A Shorter Term Is Normal With Mobiles, But Being Done With Payments In 10 Years Instead Of 30 Sn't All Bad. The Payment Will Be 363.99. The First Month, 200 Will Go To Interest, And 163.99 To Principal. You Built More Equity In This Scenario.Mobile Home Rentals On Land Might Appreciate More Slowly Than The "regular" House, But Faster Loan Pay-down Usually Covers This Factor. Pay Less Per Month, Have Positive Instead Of Negative Cash Flow, And Build More Equity! Don't Expect Your Real Estate Agent To Tell You This.BMobile Homes - Cash FlowBIn The Example, You'd Lose About 150month On The House, After The Payment, Taxes, Insurance, Repairs And Other Expenses. You'd Have Cash Flow With The Mobile Home, And After Ten Years (when The Loan Is Paid Off), You'd Have A Lot Of Cash Flow. Mobiles Are Cheap To Maintain. The Furnace Died In Rental I Owned, And I Replaced It For 1,200, Much Less Than A Furnace For A Larger Home. For 200 You Can Have The Roof Tarred, Instead Of 5,000 To Re-shingle A Traditional Roof. Windows, Plumbing, Doors - They're All Cheaper. Property Taxes And Insurance Are Less Too (be Sure You Can Get Insurance, Since Some Old Mobiles May Be Uninsurable).BThe Bottom LineB20,000 Can Buy Two Mobiles, With 10,000 Down On Each, Or Four With 5,000 Down On Each, Instead Of One Negative-cash-flow House. The Two Investors In Our Town That Own Most Of The Mobile Homes Always Have Cash Flow, And Have Built Millions In Equity. Others, Following Their Prejudices, Struggle To Make Money With Their "nice" Rental Homes. So When You're Looking For A Good Investment, Don't Forget Those Mobile Home Rentals.
