The Ins & Outs of Mobile Home Park Management

The quality of a mobile home parks performance can be directly related to the quality of the management it has in place. Therefore, it’s important we discuss the ins and outs of mobile home park management.

A mobile home park owner typically oversees the management of the mobile home park him/herself. This role is called off-site management. Even if as a park owner, you wanted to live in the park yourself to do the on-site management too, that itself becomes impractical once you own park #2, #3 and so on. Therefore you are going to need some eyes and ears in the park to handle; rent collections, repair and maintenance issues, meter reading (of utility meters owned if any), a point of contact for emergencies and water leaks, someone to shut off utility systems in case of emergency, make sure tenants are following park rules, hand our notices to tenants, show homes to prospective buyers and so on…

There are different ways to handle this based upon the income the property produces and the competency of persons involved and this process:

Point of Contact: Let’s start with a small park with little activity and little income. In this case all we need is a warm body in place to call us if there is a water leak and perhaps show a home or two to new tenants as homes become available. They won’t get much more compensation than free lot rent and maybe something to help cover phone costs. They need to answer the phone when you call and be around the park most of the time. A good role for a retiree who’s been living in the park a long while and is going to be there anyway. Offsite management can take care of all other management and rent checks can be sent to corporate office for processing or deposited directly by tenants at the bank.

Part Time Onsite Manager: Next level would be having a part-time onsite manager. Depending on how big the park is and how much workload you have going on with different projects in the park, this set up could work for parks up to 200 spaces. They’ll have much more involvement than a “point of contact” as they will need to: answer all calls, collect rents, manage repair and maintenance issues, manage evictions, communicate with contractors, make sure tenants are following park rules, meter reading (of utility meters owned if any), handle emergency situations, hand our notices to tenants, advertise homes for sale, show homes to prospective buyers and so on.

The compensation here is obviously more than a “point of contact” would make. In addition to free lot rent, a part time onsite manager typically makes between $10-$15 per occupied lot, per month, with potential collection bonuses, sales bonuses and discretional bonus’ for exceptional performance. There is a range here as not all manager are created equal. Some will just get by and some will knock it out of the park.

Full Time Onsite Manager: Next level is having a full-time onsite manager. Unless there is a significant amount of activity going on at the park, i.e filling 50% of vacancies and/or major infrastructure projects, there is rarely a need to have a full-time onsite manager unless they are managing over 200 lots. In this case they will do all that a part time manager does, although they have a lot more going on resulting in working more hours. In addition, they may have a sales showroom and be selling homes like hot cakes. At this level your best off giving a fixed salary each month with some attractive collection, sales, and discretionary bonus in place to inspire top performance. At this pay scale, you’ll typically get a business professional with high integrity and self-drive.

Like most things in life, you get what you pay for. That rings true in the mobile home park onsite management space, which is another reason to lean toward purchasing larger parks that can pay higher compensation, typically resulting in higher quality management.

Onsite Maintenance:

We’ve mentioned onsite management, and we also have onsite maintenance. Maintenance works under onsite management and in smaller parks can also double as management, in which case you only have to give free lot rent once, making onsite staff costs more manageable.

Offsite Management:

No matter what onsite staff is in place, the park owners still need to take care of offsite management. Depending on onsite manager type, this could mean: scanning or depositing rent checks, overseeing construction projects, ordering homes, auditing bookkeeping and managing tax filing, managing ownership entity, accounts payable and receivable, back-end marketing, communicating with city, county and state and so on.

Managing from Afar:

Once you purchase a few parks, unless they are all in the same remote location, you are inevitably going to end up managing parks from afar. It’s important to touch on this topic as, managing from afar, is often not as hard as most people think it is, if it’s done correctly that is.  

Investors often ask me: “Bryce, how do you manager such large properties from afar? I have enough problems managing contractors at my own home” in which my response is quite simple. Firstly, I have over 20+ years experience with large industrial construction projects. I began at the working level, worked up the foreman level, then superintendent, then inspector, management, regional management and finally business ownership level. Although managing these type projects is my realm of expertise, there’s a little more to these projects than just the construction side of things.

Even if you’ve had no construction experience or real estate experience, If when buying your first park, you follow my “4 to 6 week Mobile Home Park Purchase – Inspection Schedule” that I offer in my “A to Z of MHP’s – everything you need to know about mobile home park investing” live workshop and home study course, you’ll learn enough and work with enough vendors, professionals, contractors, city, county and state authorities (which are all a great source of knowledge) to know where to start, what needs attention and what to do once you own the property. That are least takes care of knowledge and planning, but how to do see all this through?

As buying any property (whether short term or long term) you’ll need to build a team. John carney covers this topic in chapter 3 of our new book “10,000 Miles to the American Dream” by #RealEstateMates. I’d highly recommend you read that chapter as knowing how to successfully build a real estate power team is an essential part of owning any property and especially if your building your real estate empire. Once you have your power team in place, then you are fairly well set up to manage this property. For mobile home parks specifically, you’ll need 3 of each contractor (plumbing, electrical, mobile home repairs, roofing, painting, handyman, landscaping, mobile home transporter, paving etc.) and you’ll need your onsite manager and maintenance as we mentioned earlier. That’s a lot of people to hold accountable, so how does that work? The answer to this is simple – 3rd party verification and technology. Let’s face it, just about everyone has a camera and video recorder in their pocket at all times, it’s pretty easy to take before and after photos and videos to verify work needed to be complete and work completed. In addition, we can have a 3rd party person verify that this work did in fact need to be done and that the finished product is sound.

We also have real time video calls (i.e. Facetime or Skype off a cell phone) where we can virtually be at the park anytime with our manager, maintenance crew, contractor or inspector. We can have a conference call with city and county officials and others in our team as if we are all in a meeting room together. We have our onsite staff take a video while driving through the community, so we can take a virtual (live or recorded) drive through tour and spot any yards that need to be cleaned, dangerous breeds of dog that are not permitted in our community, or odd and unacceptable activity. We can even notice positive things like who have the cleanest yards in the community (we have competitions for things like this!).

On the eire side of things here, we have seen footage of a 4 foot chucky doll, covered in red paint (simulating blood), with its head ripped off, and hanging upside down with its feet in a noose that’s hangs from a large tree in one of our tenants front yards. Apparently, that was to keep the kids out of their yard. Or even scarier, we had been told by one of our managers that a lady in one of our homes had died a week ago, then later that week, we saw live footage of the supposedly dead lady walking with trash towards one of our dumpsters. Initially It seemed as if she were a ghost, though we later found out that our manager had lied to us in aim of helping that tenant move from the community without penalty of some late rents that she owed.

Not to mention the many people who live in a park. For example, if we have an average of 3 people living in each home in a 200 space park, that’s 600 sets of eyes and ears, which translates into 600 mouths that can spill the beans of any foul play going on in the park. One thing you can count on in the mobile home park space, it that if someone’s up to something, management will find out one way or another!

We can use live share files like dropbox to share documentation, spreadsheets, photos and videos. We use management and accounting software that onsite staff and offsite staff have access to, in which we have 3rd parties audit and reconcile where necessary. On top of all this, we of course have offsite management physically visit the property through the initial inspection periods, after closing, then periodically at either, milestones in critical projects or simply randomly upon surprise throughout each year. Again, we can’t stress enough how important it is to build a solid and reliable team. As you can see, with a solid team, all this technology, self-policing tenants, 3rd party and personal verification combined, we can pretty quickly and accurately handle and manage a property from afar along with all the people involved.

Really all you need is a computer, a smart phone, connection to the internet and some basic computer skills and you can manage a property from practically anywhere. Another advantage of this is that with this type set up it can be a lot more efficient that driving to and from your property all the time.

Summary: it is in some ways easier to manage a property that’s 5 mins from your house rather than one that’s across the country, although at the end of the day, it’s really all about your mindset and if you can get over the psychological hurdle that you are managing from afar (some people can do this and some people have trouble here), then that’s really 90% of the battle. If you can handle the fact mentally, that you can’t be there in 5 mins if a water line breaks, then you’ll be fine. Of all the crazy events that have happened as a mobile home park owner (trust me I could write a whole book on this), there has never been a case where I’ve had to rush out to a property to successfully solve any problem First step is mindset. Knowing that you can manage your park from anywhere. Second step is building a power team and having good onsite staff in place. Third step is good systems in place to not only stay on top of things but stay ahead of the game. Fourth step is looking at your increasing account balance, and the smile on your face in the mirror, because you successfully followed steps 1, 2 and 3! 

To learn more about the ins and outs of mobile home park investing, how to avoid pitfalls and maximize profits, all from the comfort of your own home: Get your hands on the “A to Z of MHP’s – everything YOU need to know about mobile home park investing – Home Study Course!

For live workshops, other home study courses, or FREE educational resources like podcasts, webinars or videos:

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With Gratitude,

Bryce Robertson

“Your Australian Real Estate Mate”

Real Estate Investor | Best Selling Author | Syndicator | Educator