What is the going cap rate for 10 year old or less mobil home parks in Texas?

In Buying Property - Asked by Eldon R. - Nov 13, 2008
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Answer(s)

Dan H.
Corporate Investor
Powell, OH

While I am not an expert by no means on Mobile home parks in Texas, I have a pretty good handle on cap rates of multi-family properties and they more or less have the same fundamentals. Historically mobile home parks have higher cap rates than apartments. My guesstimate is the going cap rate would be somewhere in the 11% to 12% range. You should talk to a few local brokers and get their insights. You can do a search here on Loopnet to get an idea of who in your area is working these kinds of deals.

Nov 14, 2008
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Glen W.
Lender/Mortgage Broker
Atlanta, GA

Allot depends on the type of mobile home park (ie: single wides, double wides). Also you will need to factor in how the units are metered (is central water, sewer, etc.. included in the rent). I would guestimate a cap rate in the range of 10-12%. One word of caution, make sure you fully understand the total expenses in running the park, they are very management intensive. Below is a link to my blog talking about the rise in cap rates as well. Good luck with your transaction

Nov 18, 2008
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