Nine of 42 lots are park-owned homes and the seller won't split the price

Your 48% expense ratio isn't comparable to the 35 to 45% range quoted for this asset class. That range describes a park where every home is tenant-owned and the operator maintains ground and infrastructure only. Nine park-owned homes give you repairs, turnover, and vacancy on structures, which is apartment economics at small scale. Pull the home rent and the home-related expenses out of the T12 and rebuild the statement as 42 lots of lot rent against ground and infrastructure costs. That rebuilt ratio is what a lender and your eventual buyer will price, and the gap between it and 48% tells you how much of the broker's cap rate is being applied to the wrong income.

On valuation of the homes: manufactured homes not permanently affixed are generally treated as personal property that depreciates, and whether a given home is realty or personalty depends on the state's titling and affixation rules, so confirm the status of each one with counsel in that state before you assume either. Applying a going-concern multiple to depreciating personal property is how buyers overpay in this sector. Operators typically price them near wholesale or replacement value and underwrite converting them to tenant ownership over time.

The sewer question is answerable with money. Camera the lines, pull the pump run-time data if the panels log it, and get a licensed contractor to price a full station rebuild. Then decide whether you can fund that from reserves without a capital call.

Whether you can bill residents separately for water or sewer, and how much notice a lot-rent increase requires, is set by state statute and sometimes local ordinance, and several states have manufactured-housing-specific tenancy laws, so check the rules where this park sits before you underwrite any increase.

Your whole model rests on how fast you get from $325 to market rent. If that takes five years instead of two, the sewer capex has to come out of thinner cash flow.

Nine houses you have to fix is a job, and I want income. The 33 lots are the part that isn't.

Can I ask a basic one? When you say tenant-owned home on a lot, the resident owns the actual building and you own the dirt under it, and if they stop paying you can't just re-rent the house because it isn't yours. Is that right? I'm trying to understand what happens to a lot when someone leaves and takes nothing with them, because the chapter says moving a home costs thousands and that's why people stay.

Before the sewer, I'd want the lot leases. Ask for all 33, not a summary. What I'd be reading for: term and renewal, whether rent increases require a stated notice period, whether there's any assignment or approval language when a resident sells their home to a new buyer, and whether the seller has been enforcing whatever is written. Parks at $325 in a $450 market usually got there because the owner never sent a notice, and sometimes what's in the drawer is a two-page form from 1994 that doesn't match the current state statute. Manufactured housing tenancy is its own body of law in a lot of states, and the notice and cause requirements differ, so an attorney in that state should read them.

@juniper an abandoned home on your lot becomes your problem, and the abandonment process is also statutory. That's part of what flint is buying whether he prices it or not.

The thing I'd write down before deciding: what does the deal look like if you buy it, do nothing to the rents for 18 months, and the first lift station dies in month 4. If that version still services debt, the home price argument matters less than it feels like right now. If it doesn't, the $290k is the only thing standing between you and being out of cash.