As the economy has shown recently that we are now entering, what seems to be, a recession one needs to look at how this affects the mobile home industry in and outside of the greater Sarasota Florida area.
With prices of real estate staying near record highs and interest rates for traditional mortgages continuing to increase how will this affect the mobile home marketplace going forward both for the near and far-term time frames?
If you are looking at buying or selling a mobile home within this environment, what factors should you consider?
Here at, The Mobile Home Dealer, we feel that we need to let everyone know exactly what is going on, how to work through it, and more importantly how to thrive in these crazy real estate times.
Arming yourself with the most recent information on Florida’s housing market is the best way to avoid catastrophic financial loss whether you are buying or selling a mobile home. It should be noted that a recession is not always 100% bad. If you are well-equipped and do the right things, you can be a successful buyer or seller regardless of the housing market condition.
If you are looking at buying a mobile home in and around the greater Sarasota Florida area we stress that you look at two things before putting an offer in on the home:
- What structural updates have recently been done to the home?
- What is the lot rent currently at and what is the expected increase for the following year?
The reason why structural updates are important is that these are the updates that usually cost far more than cosmetic upgrades and are ones that may carry warranties on them to you as the new Buyer.
Examples of structural updates could be a new roof over, a new AC unit, updated plumbing, updated electrical, or redone subflooring. These updates all cost a lot of money and will add to the value of the home significantly due to the fact that they are tangible items added to the home that improve the structure of the home, unlike cosmetic updates which are based on the Seller’s personal interests.
Always make sure to confirm with the park office exactly what the current lot rent is when it is expected to increase and approximately how much it is to increase next year.
The reason why this is important is that even if the park is unable to tell you exactly how much the lot rent may increase for next year they should be able to tell you how much the lot rent has increased in the previous years which will give you a fair idea of what to expect going forward.
Having verified lot rent for both the current year and the following years will give you a pen-to-paper idea of exactly what this expense is so that you are not purchasing more homes than you can afford.
If you are looking at selling your mobile home in and around the greater Sarasota Florida area these are points to consider during your sales journey:
- What other like homes are selling for in your same area?
- Is your home able to get financing?
The tried and true one-liner of; you don’t want to be the most expensive home in the neighborhood is just as true now as ever.
When looking at pricing your home make sure you understand and can verify what other homes in the area are selling for and price your home accordingly.
Recently, we have seen several unrealistic Sellers price their homes much too high in the hopes of hitting a price homerun only for them to find themselves sitting on the home for months on end. Remember, the longer your home sits on the market the longer you are paying lot rent and other utilities which eats into your profit!
Most financing companies will not finance a mobile home on leased land.
There are, however, financing companies that will finance mobile homes on leased land so long as the home is a 1976 or newer. If the home is older than this then financing can be nearly impossible for a Buyer to obtain.
Whether you are a buyer or seller, it is always recommended to get updates on the ongoing recession that affects the housing market, both traditional homes, and mobile homes. Florida is known to be notorious for housing market volatility and the mobile home market is no exception.
There are even reports predicting the crash of Florida’s housing market but don’t get worried about this.
According to a Forbes report, as of October 2022, Florida’s housing market is slowly recovering even though the median price of traditional houses is still higher than in the past. The crash is unlikely to happen based on the given data.
We stress this fact to be known because if the home is overpriced and too old to be financed then you are relying on an all-cash Buyer to buy the home which dramatically cuts down on your available Buyers.
Buying or selling a mobile home when entering a recession can be stressful but, if armed with the right information from the start, you can certainly be in a position to succeed at a level higher than you have ever imagined!
This is Mark Kaiser with The Mobile Home Dealer and we help mobile home Buyers and Sellers get to a better place in life.