What’s going on y’all, Maxwell Baker here, signing on again with The Mobile Home Park Broker.
I wanted to give you all a quick update of what we are seeing in the mobile home park industry and secondary tertiary markets across the southeast, and really across the country. What we’re seeing and what we’re hearing from clients.
Institutional loans, like I said before, and some of these other recordings are still frozen. Fannie and Freddie are obviously asking for way more reserves these days – 15‐18 months. We’re also seeing CMBS just on complete lockdown. Some of these other institutional people, even hard money lenders, are frozen.
However, there is light at the end of the tunnel. We are seeing community lenders still financing mobile home parks. That’s pretty cool, huh? They’re looking at like 20‐25 year amortization, low fives, the mid‐fives, upwards to 7% interest. I know those are a little rich, but some of the other community lenders we found even go sub‐five into four, so those are recourse loans. Community lenders typically do recourse unless you’re putting down 50% as well as a minimum 640 credit score and a lot of times these community lenders want you to live in the state that the park is in versus across state lines. Every once in a while, you can get away and find a lender that doesn’t care about where you’re located, all they care about is your experience and your resume and we have those types of relationships that we can hook you up with.
So that’s that with the financing world.
We’re seeing more owner‐financed deals, surprisingly. Sellers are a little anxious, they want to sell their deals. We do tell them that we can find community debt, however, there’s a little bit more involved in getting that kind of debt. So we’re still seeing a lot of that.
As far as occupancy levels for mobile home parks, I am proud to say that mobile home parks have maintained rent levels through mid-April and they didn’t really miss a beat. We did hear that some of these communities, some of these mobile home parks in university towns are taking a beating because of the schools being shut down as well as a lot of those people that live in the mobile home park are not able to maintain jobs in retail, food and beverage, and bars and restaurants. All that kind of jazz is not being serviced right now. So we’re seeing some drops in the universe in university towns, not just in mobile home parks, but also in apartment communities from what I’ve seen.
The big buyers are on hold right now. I’ve heard from multiple people that they have stopped buying. But first‐time buyers or medium regional buyers are still very active. They see the opportunity and we’re starting to see more opportunities for people to move product faster. People are at home watching every single email that comes through the system and it’s a good platform to sell deals right now.
So if you have a park that you are interested in looking at, maybe getting some offers on, give us a call. That’s the quick market update I wanted to give you all on the mobile home park world. If you have any questions, we do have some other stuff going on market‐wise that I don’t want to make this post too long, but if you want to chitchat give us a call: 678‐932‐0200, and one of our awesome agents ‐ Eric, Craig, or Todd, and soon Christian as well as Ryan who will be joining us pretty soon, will be able to help you. Look forward to hearing from you all.