Is mobile home park, best Passive income?
Top vote goes to mobile home park (MHP), then Multi-family…
Even though I can achieve higher returns through stocks and REITs, depreciation can not be claimed for stocks/REITs. Real estate has low rate mortgage leverage which is not available in Stocks & REITs.
Some people there claim mobile parks don’t need managers?
Your park will fast become a giant meth lab.
Interesting. So they are saying 8-10% CAP for MHP? But can’t you get more than 10% CAP even on mid-west SFH turnkeys? I haven’t looked into MFH in mid-west, might be a way to go with 50+ apartment buildings there if you can find boots on the ground, they are probably cheaper than one SFH in bay area 
But the MFH’s in midwest will likely have 0% appreciation, or even negative. I think cashflow and appreciation is like a dial. You can turn it one way, have more of one thing at the expense of the other. But you can’t have both. MFH in rustbelt MidWest is turning the dial all the way to cashflow.
I often wonder when will be good time to have that in my portfolio? Maybe the answer is never. Maybe it’s right now. Don’t know. There are areas in Bay Area that allows me to turn the dial a bit more towards cashflow, but still have some appreciation. We have covered a few here: Oakland/SL, Newark/UC, maybe even CC county. I’d exhaust all these options before heading out of state, most likely. Although I am tempted by Seattle right now… 
I agree. That’s my dilemma right now too. Diversification with high appreciation and cash flow seems like a nice theory, but I am not sure it is right thing either. I think we are on the same page right now with trying to dial more towards cash flow in the BA. But other than Oakland & DalyCity, I don’t really see much. I am not sure Newark/UC are cash flowing with today market value (without granny unit). Instead of side bet towards Seattle, it is Austin for my side bet.
Newark and UC are cashflow neutral at best. The part of Oakland I am monitoring: below 98th and close to SL, is still cash flowing very well. I am mostly curious about tenant quality there. But recent newspaper articles covering that area gives me hopes.
Even if that area is not appreciating as well as hoped, the cashflow will still carry the investment.
What’s the CAP rate are you looking at for that area?
I don’t have a specific target.
Just take this as example. I just happened to get Redfin email update on it 20 minutes ago:
https://www.redfin.com/CA/Oakland/1606-Tucker-St-94603/unit-62/home/1709942
Newer townhouse. 2/2.5 1500 ft. Asking for 380K. PITI is $2200 if you put down 30%. Zillow rent estimate is $2850. So cashflow is $650 a month. More conservative we can round it down to $500. It feels about right.
So cash on cash it’s 120K down payment and $500 a month in return. 5%. Plus the principal pay down. Pretty decent.
And I’ll have the option value of the area gentrifying and appreciating. It most certainly will appreciate. Just a matter of slow or fast. Can’t say that about most of Midwest.
I just bought a 10 cap multi family in South Lake Tahoe…the holy grail in RE…plus appreciation is 10%/y…a unicorn in the RE world…
Dont forget Self storage. …no tenants rights BS and achievable 8 caps…
Where do you find those? I looked on Loopnet and don’t find any.
Would love to see some reference or comparable property and location if you could share? Have been looking for those holy grails
Send me a private message for holy grails…
There is a self storage magazine. …I know a broker that specializes in self storage…like most commercial deals they are done privately…info not shared with the public. …only qualified investors with experience need apply…
Buy the darn mobile park and build tons of condos or whatever. Isn’t that what everybody is complaining about? The lack of new units? Go ahead, do it! Not!
Found some mobile home parks on loop net. It’s tucked under the “Multifamily” category.
This one in Acampo claims 9.9% cap rate, 19 spaces, fully rented. Asking for 1.6M.
http://www.loopnet.com/Listing/19343468/24064-N-Highway-99-Acampo-CA/
It already has an on-site manager. Last year’s net income was 158K.
Most mobile home parks are hard to convert into standard housing units. They have too many problems with local ordinances. Just look how long they have been trying to sell the one in PA.
I hear treehouses are the next gold mine RE investment in SV…