So, you bought this nice (or maybe not so nice) little mobile home park.
You’re excited. You know there’s a ton of potential and plenty of value and equity to build into this asset over the next couple of years, but who will manage this whole operation daily?
I have a full-time job!
Actually, YOU are going to manage your mobile home park.
If the park is mid-managed, it’s an underperforming asset, not profitable, or any of the above– the last thing you want to do is keep the previous property manager on site.
“But what if they promise you they will change? They just need a bit of leadership and guidance?”
Managers rarely change, especially when discussing a total park makeover or repositioning.
Many on-site managers are overpaid!
Many managers are underpaid!
Many managers are getting free rent (sometimes, without the owner having a clue), free storage, free water, firewood, fax machine, long-distance telephone, etc- are you tracking?
Many managers are great managers who are paid fair and just, but some managers will pocket the late fees they are collecting, keep pet fees, or other fees.
Many managers will charge by the hour for regular maintenance tasks like landscaping, light plumbing, or electrical work.
Bottom line up front: there are bad managers and good managers out there.
So, who would you trust? A friend, a family member?
How much should you pay a manager– even if they are trusted and experienced?
What if the manager is unhappy with their pay and compensation?
How are other parks in the market compensating their managers?
Little time is required each month to run an efficient park.
Most people wouldn’t mind spending the few hours a month it takes–on top of physically collecting rent– to oversee a mobile home park directly.
If you decide to look for and hire an on-site manager to help you run your park, make sure you are certain they understand and will comply with all fair housing and discrimination laws.
Taking on all the legal liabilities as the park owner but allowing a different person–the local property manager– to be not only “the face” of the asset but the one in charge of collecting rents and fees is probably the most significant risk a mobile home park owner can take. Rent collection is a huge component that contributes to the financial health of your asset.
For these reasons, I strongly consider running your own park in the most efficient and legally compliant manner possible.
There are intelligent, modern ways to leverage other people’s time, efforts, superpowers, and skills.
Vetting any partner or employee that you are considering working with is paramount. “Hire fast and fire slowly” certainly applies to mobile home park investing.
Want to learn more about mobile home park investing? Check out ADPI’s Military Multifamily Academy and sign up today!