As a rule, I always dissuade investors from purchasing investment properties on leased land because when things go bad, they go very-very bad.
PRO: You can purchase these cheaper than the same property with real estate. Usually, these are in locations where tenants are looking.
CON: They can be nearly impossible to finance. In the state of Ohio there is only one company that lends on detached mobile homes and they require 20% on a 5-year arm at nearly 2.5x the rate for similar investment property with land. However, my biggest issue with leased-land is that the value of your investment is at the whim of another individual. What happens if the land owner sells and the new owner wants to develop the land? You're out of luck.
I always suggest taking the higher expense route to keep the value of your investment in your own hands.
Feb 25, 2014