Park-Owned Home in Mobile Home Park

[Deleted member 152047]

This is very easy, the value of the real property is the market lot rent less expenses capped out. You can determine the contributory value of the park-owned homes via the income approach as that is how an investor would view it. You take the market rent of the lot owned homes (all in) and deduct the market lot rent, then cap that at a rate greater than that of the real property. That would give you the contributory value of the park-owned homes.

Most MHC's include some level of park-owned homes in their sales. During your sales research it is important to note how many park-owned homes were included in the sales of your comparables. These comps will generally have significantly higher capitalization rates and NOI/pad. You can adjust for that in the SCA.

Hope this helps!

 

[CANative]

Value of the individual leasehold interests plus contributory value of the improvements (if any.) Use a cost service for the MH to make it easy, or sales approach to make it look good.

The value of the leasehold comes from the fact that moving a unit is almost unheard of and one can't be evicted except for non-payment or violation of park rules.

 

[Elliott]

NP said, This is very easy, the value of the real property is the market lot rent less expenses capped out. You can determine the contributory value of the park-owned homes via the income approach as that is how an investor would view it. You take the market rent of the lot owned homes (all in) and deduct the market lot rent, then cap that at a rate greater than that of the real property. That would give you the contributory value of the park-owned homes.

Easy peasy. What Res Cert can't pull a supported cap rate out of their butt. : )
That's why I always said, "Sorry, never done one and there isn't much data."