Mobile home parks (MHPs)—communities where residents own their home but rent the land—are drawing increasing attention from savvy real estate investors. Cheaper than apartments, recession-resistant, and often offering strong returns, they’re a compelling option. But like any investment, they come with trade-offs. Here’s a human-friendly guide to mobile home park investment and evaluating MHP ROI in today’s market.
Why Mobile Home Park Investment?
1. High Demand, Low Supply
With housing costs rising, MHPs have become a go-to affordable option. There are about 21 million Americans living in manufactured homes, and demand continues to outpace supply.
Zoning restrictions make adding new parks difficult, keeping existing parks lucrative.
2. Consistent, Long-Term Tenants
Moving a mobile home is expensive—often $5,000+. As a result, residents often stay for over a decade .
MHPs in Q1 2025 reported occupancies around 94% .
3. Strong ROI & Resilience
Typical cap rates sit between 7–10%, among the highest in real estate asset classes .
Lot rent growth averaged 5–6% over the past year.
Even during recessions, affordable housing remains in demand.
Benefits of Mobile Home Park Ownership
- Low operating costs: You maintain the land and infrastructure—not tenants’ homes.
- Utility add‑ons: Smart metering systems can drive NOI up 15–30% by passing through utility costs.
- Affordable per‑unit cost: Land lots often cost under $10k vs $100k+ per apartment.
- Tax perks: Depreciation, maintenance, and infrastructure expenses offer deductions.
Drawbacks and Risks
- Challenging financing: Small parks (<50 lots) may be tough to finance.
- Intensive management: Utilities, parks, and regulations require hands-on oversight.
- Insurance and taxes: Coverage and property taxes can be higher than typical rentals.
- Regulatory scrutiny: Rent control efforts and stigma can lead to regulatory pressure .
- Tenant pushback: Residents sometimes organize against owners after rent raises.
How to Evaluate MHP ROI
- Location Matters
Target parks in growing job markets with tight housing supply. Sub-metered parks in Sun Belt states like Texas or Florida are top performers . - Analyze Lot Rent and Expenses
Typical lot rent is $300–900/month. Park owners handle infrastructure, record NOI, and calculate cap rates. - Watch Occupancy Levels
Healthy parks run 90–95% occupancy; anything below 85% needs closer inspection. - Check for Utility Pass‑Throughs
Owners who sub-meter can pass utility costs to tenants, boosting NOI substantially. - Estimate Value‑Add Opportunities
Could you raise rents to market level? Improve infrastructure? Add amenities? These moves increase value and yield. - Consider Management Model
The right operator is key. Whether self-managing or hiring a management company, look for experience and local knowledge.
Acquisition & Financing Tips
- Seller financing can help if banks aren’t an option.
- Lease options or rent-to-own let you control a park before full purchase.
- Private money or crowdfunding opens doors for buyers with less capital .
Real-Life Success Stories
- Frank Rolfe & David Reynolds: Bought parks in the 1990s, now owning 160+ parks and earning ~$30 million annual revenue by improving conditions.
- Business Insider case: Investors Byron and Sharnice Sellers flipped mobile homes, reinvested in parks, and mentor thousands now.
- REIT example: UMH and Equity Lifestyle REITs saw Q1 2025 NOI and lot rent growth (~5–11% YOY), occupancy near 88–94%.
Responsible Ownership: Ethics & Community
Balancing profits with resident welfare is key:
- Implement hardship programs and fair rent increases.
- Partner with nonprofits to preserve affordable parks.
- Engage residents openly—communicate and build trust to avoid backlash.
Final Takeaways
Mobile home park investment offers a rare blend of affordability, stability, and yield, with MHP ROI often higher than traditional rentals. Key advantages—high demand, low operating costs, utility pass-through potential—make it attractive. But success comes from smart acquisition, ethical operation, and effective management.