Show Highlights-
“Whether in law or real estate, you need to have a professional mediator and guide.” (Max, 00:56)
- “If a buyer is negotiating with you directly, you’ll be exposed to the emotions… and have to deal with the silver-tongue tactics to get you to sell them your park at some sort of discount.” (Max, 00:56)
- “Case in point, there’s a deal I was working on here in the south that the couple was in a divorce… and they were always trying to cause drama for the deal.” (Max, 03:13)
- “We ultimately found a better buyer that would play by our rules as the seller and got it done.” (Max, 03:13)
- “Little Mythbuster for y’all, you can save a lot of money by selling the park yourself. This is a big myth in our industry.” (Max, 05:41)
Power Quotes- “Hiring The MHP Broker will be your best bet for getting the most out of your community, creating the least amount of stress and boosting your confidence…” (Max, 00:56)
- “These Wall Street type buyers… are really good at hammering you at the last moment to adjust the contract price downward.” (Max, 00:56)
- “There are so many other variables involved in selling a park that it makes sense to hire us as your broker.” (Max, 05:41)
- “It’s a classic mistake to think of them as your friend.” (Max, 05:41)
- “The buyers are adversaries who want to make money off you.” (Max, 05:41)
00:00
Hello and welcome to the Mobile Home Park Broker’s Tips and Tricks. This is the podcast where we talk about mobile home park investing, because that’s what we’ve been involved in for the last decade. Let’s dive into today’s episode. Here is your host, Maxwell Baker.
00:22 Maxwell Baker
Hey, y’all, welcome to another eeeepic episode of The Mobile Home Park Brokers Tips and Tricks Podcast. I am your host, Maxwell Baker, yours truly, CEO at the firm. Today we’re going to be talking about your seller’s guide. So, this book is what I wrote a little while ago, for all y’all sellers, all you sellers, depending on where you’re from, as I’m going to say it, all you guys and girls out there that are sellers of mobile home communities. Today, we’re going to be going over that book. So, I’m going to be doing a little bit of a summary, but also be reading directly from the book.
00:56
Chapter Six, ‘Why trying to sell your community on your own is a little risky?’ Whether in law or real estate, you need to have a professional mediator and guide. It helps you keep an arm’s distance between yourself and the adversary, the Buyer. You want to be able to leverage what they say, strip out all the facts and leave the emotions out of it, having a trusted third party allows you to do that. As a professional mediator like those here at our company, The MHP Broker, we have the ability to ask the right questions, interpret perspective buyer’s answers, and gear the marketing of your community to a certain type of buyer. A good brokerage firm will tell you whether or not your buyer is legitimate. The brokerage firm can strip out all the facts, variables and emotions and give it to you straight. If a buyer is negotiating with you directly, you’ll be exposed to the emotions, to their instant rapport building skills and have to deal with the silver-tongue tactics to get you to sell them your park at some sort of discount. I know several buyers who are about as slick as they can get. Hiring The MHP Broker will be your best bet for getting the most out of your community, creating the least amount of stress and boosting your confidence that is all being taken care of by professionals who do it every day. These Wall Street type buyers who will woo you all the way to closing are really good at hammering you at the last moment to adjust the contract price downward, asking you to throw in valuable operating equipment for free, requiring all sorts of contract contingencies that make little sense, and before you know it, you’re selling your park to them with 10% down, 30-year amortization and 120 day contract to close. It’s important for you to hire somebody who can separate and mediate all of that crap that they will throw at you. I negotiate all the time with these slick people. They hate it anytime I get involved, because they know I’ll prevent them from making the best deal for themselves. A lot of times, they’ll say, Max, why are you involved in this deal now? the buyer might not always be thrilled, but I always get the best price I can get in the terms possible for our sellers.
03:13
Case in point, there’s a deal I was working on here in the south that the couple was in a divorce, and one of the spouses was a lunatic, and they were always trying to cause drama for the deal. What it looked like after we closed on it was, they had inserted a straw buyer so that they could later, downstream, take over the park without the other spouse getting as much money as they could have, if they would have just played nicely with one another. So, with a broker i.e., us, we were able to get the spouse that was getting taken advantage of the best price they could get, simply because we punched holes through all the stuff that the other spouse buyer brought to the table and literally scared away that buyer. That buyer also had a shady real estate agent that was causing a bunch of drama and contacting the seller directly, which is highly unethical in the industry for brokerage, but we were able to save the deal, and we were able to get it done so a good broker will protect your interest and always try to make it fair for you know, the situation that be the Divorcee and a Divorce. It was a challenge, but a good broker will help mediate that and ultimately, if there’s any funny business that the other spouse is bringing to the table, a good broker will be able to sniff that out and, in this case, we were able to sniff that out because the buyer that the other spouse brought to the table had a really crappy contract. They were literally just trying to tie the deal up and cause a bunch of drama to keep it in lawsuit for the next 6 months, 12 months, who knows, maybe even longer but we were able to use our company contract that we have spent a lot of money on through a specialized attorney in our industry, and the buyer basically walked away because he felt like he couldn’t get what he wanted. We ultimately found a better buyer that would play by our rules as the seller and got it done. So, case in point on why it’s very important to hire a broker that knows what they’re doing and knows how to identify the crap that some of these people bring to the table.
05:41
Mythbuster, that is the title of this next section of Chapter Six. Little Mythbuster for y’all, you can save a lot of money by selling the park yourself. This is a big myth in our industry. A lot of mom-and-pop organizations want to sell their parks by themselves, but it’s hard to evaluate mobile home parks. There are a lot of slick negotiators and contract variables that you will need to thoroughly understand and be able to see through. A lot of lenders out there will be evaluating your financials and curb appeal you, need data in order to maximize your profits with the appraisals and the sales comps, rents and rental comps all help with that. There are so many other variables involved in selling a park that it makes sense to hire us as your broker. That’s why teaming up with us that have all the information you need to maximize your price, the data and knowing all the pitfalls and the Wheelers and Dealers could save you from losing 1000s, if not millions, of dollars, or could make you extra $1000s or $100,000s or $1,000,000 dollars more by leveraging our skill set. Our firm has done, it says 150 here, but we’re well over 700 transactions; this book’s a little dated, but we have done a lot of transactions we’ve done over the last 15 years. But the reason why I say that and I bring it up is because I don’t want to say I’ve seen everything, but after a certain time, you know what to bring to the table. You know what people are going to say. You know how the communities are going to be presented to the lenders. So, we’ve pretty much seen just about everything that the industry can throw at us when it comes to putting deals together. So, in a nutshell, remember that a buyer is trying to make as much money as possible. It’s a classic mistake to think of them as your friend. They will only leverage that friendship to get themselves special favors to lower pricing and free stuff from you. Don’t fall for these tactics. The buyers are adversaries who want to make money off you. While it happens, it’s very rare to have a buyer coming in and trying to be your best friend when it comes to probabilities, you want to limit the number of pitfalls you’re going to fall into when selling your community. That’s it for this chapter.
