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Even stick built structures depreciate
Old 06-26-2007, 07:34 PM   #21
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Even stick built structures depreciate

in real terms if not nominal ones. The real value is in the land and it is the increase in the land that results in higher housing prices. This is why there is the perpetual story about 'owners' finding out their place is next to worthless due to the last increase in land rent. It was, is, and always will be. The value is in the land.
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Old 06-26-2007, 09:42 PM   #22
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Here in the Bay Area about 7 years ago a developer was buying $40K infill lots moving two sections of manufactured homes($45K) on them for about 1400sf onto a foundation attaching a two car garage($40K) and then stuccoing over the garage and finished home and selling them for $370K!

About $245,000 profit in less than a month. I innocently asked if he had to disclose their origination. He never answered. I bet most owners don't know unless the neighbors told them.
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Old 06-26-2007, 10:39 PM   #23
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What I don't see iin your article is what to me is the most important potential drawback of this type of community-too much landlord power.


Ha, you have a very good point. In our experience, we have lived in our location since 1993. Since the beginning our annual lease has increased only a couple of hundred dollars total. Perhaps we are more open to this option because we have had good experience.

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If you own the land in fee, and the owner association has some control over maintenance fees it should be fine. But this is not usually the case. Usually you "own" the structure, and pay rent to be allowed to continue occupying it on a pad, usually on a year to year lease. Talk about having you by the short hairs.


So in your opinion, what is the difference with owning a condo in a community? They do not own the land, they only own the 'inside of the structure,' with the maintenance fees taking care of the common grounds and outside walls. Lots of people own condos and there is no ruckus..?



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In Florida a lot of the parks are being sold and the residents are left with houses`they can't move so they are basically worthless.


Again, another good point, however I would like to bring up the Briny Breezes Trailer Park Briny Breezes trailer park offered $500m to blow away Independent, The (London) - Find Articles that sold for millions, each trailer owner making a couple. Things do go the other way sometimes.

However, we look at this housing option as a low commitment, high ammenity, 'throw away' housing for those who want to travel, or not put so much money, effort, time, etc. into a location. It does not offend me if someone were to come to my well-situated, well ammenitied, well cared for, sunny home and tell me it's worthless. It suits our lifestyle perfectly. And besides, our places are moveable, and sellable -- you won't get hundreds of thousands for them, but then again, I paid very little for it to begin with. If I have to walk away from it, it won't break the bank.
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Trailer parks do get sold... or shut-down all together. Not to mention that prices can be increased and you are at their mercy (it is costly to move your mobile home).


There is a difference between 'Trailer Parks' and Adult Communities. Yes, some of them are located in RV parks. However, the term 'Trailer Park' has a whole lot of negative connotation to it. The last price I understood for moving one of these places in Arizona, it was $1,000 - $1,500.


aenlighten
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in real terms if not nominal ones. The real value is in the land and it is the increase in the land that results in higher housing prices. This is why there is the perpetual story about 'owners' finding out their place is next to worthless due to the last increase in land rent. It was, is, and always will be. The value is in the land.


Of course the value is in the land. We have lived both in California and in Arizona, and in both places the real estate market went up astronomically. People came in, bought houses which they then demolished and put up their McMansion in its place. They didn't buy that home, they bought the location.

Didn't mean to hijack this thread. I'll go away now...

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Old 06-27-2007, 09:00 AM   #24
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Originally Posted by honobob View Post
Here in the Bay Area about 7 years ago a developer was buying $40K infill lots

When I lived there...around 1995 and prior...they were filling in mudholes in Alviso next to the water and building little stucco houses on them. Those were selling for close to a half million back then...zero lots on top of that. First earthquake and those liquify into the ground.

The other option was homes in east san jose up in the hills east of the hayward fault, all built right on top of the same sort of microfault structure that exists in Northridge. All the homes had a piece of paper taped to the door advising that you could get neither mortgages nor insurance on the homes, and that even a very likely to occur, minor earthquake could cause major damage to the homes. They had built them to 150% of the building code requirements for earthquake proofing, but still.

Lines formed down the street the day they "opened" with people seeking lottery tickets that would be randomly drawn to determine who the lucky buyers would be. Those were over a half million as well.

Pretty much unbelievable.
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Old 06-27-2007, 09:40 AM   #25
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But most of those lucky buyers have probably moved on, and sold their shaky investments for a good profit.

I felt a nice little earthquake the other day.
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Old 06-27-2007, 12:37 PM   #26
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a friend of mine just paid $450k for a site-built, but more than less "manufactured" home in sarasota. they built the thing in about 3 months. all poured concrete walls, very solid house.

modular construction is nothing new and is an accepted industry standard.

for the most part all houses except those of historic or particular aesthetic value or with unusual & rare materials depreciate. for the most part it is the land which appreciates.
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Old 06-27-2007, 06:03 PM   #27
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First, I am happy that you have had a good experience. Plenty others have not as a Google search can demonstrate.

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Ha

So in your opinion, what is the difference with owning a condo in a community? They do not own the land, they only own the 'inside of the structure,' with the maintenance fees taking care of the common grounds and outside walls. Lots of people own condos and there is no ruckus..?
In my opinion there is a big difference. The park operator is the owner of the land and the improvements other than the individual units. His only constraint is his perception of market conditions, the leases with individual unit owners, and whatever legislative relief might have been given to the lessees. If he gets an offer for a business park, the MH owners suddenly own some much depreciated wood and tin.

Not so with a condo owner. There is no outside owner of the land. The land is owned by the group consisting of the unit owners.

Anyway, I imagine that your question was more rhetorical than serious.

Ha
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Old 06-27-2007, 08:24 PM   #28
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[quoMoemg


Again, another good point, however I would like to bring up the Briny Breezes Trailer Park Briny Breezes trailer park offered $500m to blow away Independent, The (London) - Find Articles that sold for millions, each trailer owner making a couple. Things do go the other way sometimes.

[/quote]

The Briny Breezes people owned their land as compared to most trailer parks were the land is rented .I've seen several parks in southwestern Florida be sold and the home owners have to abandon their homes and move on or raise the money (usually several million dollars to buy their land ).
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Old 06-28-2007, 07:52 AM   #29
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In my opinion there is a big difference. The park operator is the owner of the land and the improvements other than the individual units. His only constraint is his perception of market conditions, the leases with individual unit owners, and whatever legislative relief might have been given to the lessees. If he gets an offer for a business park, the MH owners suddenly own some much depreciated wood and tin.

Not so with a condo owner. There is no outside owner of the land. The land is owned by the group consisting of the unit owners.

Anyway, I imagine that your question was more rhetorical than serious.

Ha


Hi Ha,

Couple of things. Firstly, my question was honest, not rhetorical. Thanks for your input. I don't know every angle - I only know what we do and how it has worked for us. You are right, the condo owners have an HOA and they do not have an outside owner who may be enticed to jerk them around. However, I have heard many complaints from condo owners about their HOA's... and how fees go up often, how they are never happy, long boring meetings, yadda yadda yadda.

Secondly, our community was sold to a corporation in the late 90's. Everyone was quite nervous about that transition especially, since the original owner promised never to sell. Billy had interested tenants with big money to purchase this community and basically it was sold right out from under our noses. We would all have been able to own our lots and manage the place ourselves. It didn't happen.

However, the long and short of it was that it went well anyway, our rents were not jacked up, we got lots of new improvements and access to more ammenities.

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The Briny Breezes people owned their land as compared to most trailer parks were the land is rented


Yes, you are right. That was the ticket, owning the land. Some communities offer that option, some don't.

To be honest, I haven't heard the term 'trailer parks' in years. It reminds me of some run down, ratty place with toothless, unemployed tenants and cars on blocks. With that sort of mental picture, I would be hesitant to investigate also. Glad I have first hand experience with a different perspective! The places we know of are fairly upper crust... Sure glad they let US in!

Quote:
I've seen several parks in southwestern Florida be sold and the home owners have to abandon their homes and move on or raise the money (usually several million dollars to buy their land ).


Raising several million dollars to buy these communities is fairly easy. Billy had that put together before our commuity was sold out from under us. We were in Mexico at the time, and were not given the first right of refusal.

Unbeknownst to many on the outside, folks living in these places have big money. They live this way as an option, not because they have to or can't afford any place else. There are many many millionaires who choose this hassel free lifestyle as a second home. Granted, many people might not want the challenge of raising millions, but remember, Billy did that for a living before we retired.

Be well,
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Old 06-28-2007, 09:16 AM   #30
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That particular style of modular home looks pretty nice to me. As for depreciation, if you put something like that up in a trailer park, it's going to depreciate. If you buy a piece of land and build it with a real foundation, so that it LOOKS like a real house, it should appreciate over time as well. If you just put it up on blocks and skirt it (which wouldn't pass inspection in many areas), the land around it may go up in value, but the dwelling itself might depreciate.

FWIW, that looks like a modular home, versus manufactured. Essentially, it was built in two separate sections, with standard-height walls, etc. Each section is built strong enough to stand on its own, so in many cases these modular homes are STRONGER than a site-built home. Note, for instance, the double thickness of the center wall where the two sections join together.

I always considered manufactured homes to be those things that really look like little more than a double-wide. They usually have thinner walls, using 2x3"s instead of 2x4" studs, tend to have cathedral ceilings throughout but an outer wall that's only 7'6", instead of the "normal" 8' or more. And instead of drywall and paint, they tend to use this stuff for the walls that looks like bathroom/kitchen paneling, in 4x8 sheets, with a little plastic strip over each seam. Fleetwood homes builds these types of things, as do many other manufacturers.

Personally, I like that floorplan. I think the only shortcoming I can see is that it doesn't have a "real" entry foyer. You just walk right into the eating area. And there's no coat closet.
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Old 06-28-2007, 10:53 AM   #31
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However, the long and short of it was that it went well anyway, our rents were not jacked up, we got lots of new improvements and access to more ammenities.
Akaisha, I am truly glad it worked out for you. My thinking is only that there are risks inherent in the form; and that a single instance of success don't alter that structure.

Most of the time, it likely works out fine. But when it doesn't the challenges can come at a bad time, be expensive, whatever.

Since I don't like it when a counterparty has the drop on me, it wouldn't be for me. For someone else, such as you and Billy apparently, it might be fine.

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Old 06-28-2007, 01:48 PM   #32
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just a quick clarification to briny breezes where i considered buying many years ago but could not get myself to move into a trailer on the ocean in hurricaneville. (my current lesson in risk/reward.)

the owners there did not own the land but rather they owned shares of stock in their town. if the purchase goes through, trailer owners will be compensated based upon their number of stock shares which correspond to the size & location of the property where their individual trailers stand. it wasn't just a trailer park that was sold, it was the entire town which has a contract to sell.
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Old 06-28-2007, 02:48 PM   #33
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.

To be honest, I haven't heard the term 'trailer parks' in years.

Guess your traveling hasn't included the south in years
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Old 06-28-2007, 05:43 PM   #34
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Unbeknownst to many on the outside, folks living in these places have big money. They live this way as an option, not because they have to or can't afford any place else. There are many many millionaires who choose this hassel free lifestyle as a second home. Granted, many people might not want the challenge of raising millions, but remember, Billy did that for a living before we retired.
But unless I misunderstood, Billy's fundraising skills went for nought, and the owner sold it out from under you anyway?
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Old 06-29-2007, 02:00 AM   #35
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Akaisha, I am truly glad it worked out for you. My thinking is only that there are risks inherent in the form; and that a single instance of success don't alter that structure. Most of the time, it likely works out fine. But when it doesn't the challenges can come at a bad time, be expensive, whatever.
I understand. We are probably more on the same page than not. As I see it, owning a home has inherent risks that I am not willing to take. Property taxes can go up exhorbitantly, you don't know who might move next door to you making life unpleasant, taking out a 30 year mortgage is a very large committment, and having to make major repairs such a replacement roof, total plumbing do-overs, or kitchen and bath rennoations are simply too complicated and costly for my needs.

Most people would prefer to have a traditional home. I understand that I am in the minority - but that position is not new to me.

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Since I don't like it when a counterparty has the drop on me, it wouldn't be for me.


Here, you and I are on exactly the same page. When someone thinks they have 'one over' on me and tries to jerk my chain, I would just as soon let go of the chain. I enjoy not needing much. I am attracted to that freedom to come and go.

Unfortunately, neither one of us has total control in life...
moeng
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Guess your traveling hasn't included the south in years

Right again. We have been doing international travel since 1994. That being said, we settled into our community in +/- 1992. Although I have been to Texas and Florida, I have not been to the deep south. I'm sure it is my loss!

LG4N
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the owners there did not own the land but rather they owned shares of stock in their town.


Oh! Thanks for that clarification. Makes sense.. I knew that they all had to vote on whether or not to sell. It wasn't an individual option.

HA
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But unless I misunderstood, Billy's fundraising skills went for nought, and the owner sold it out from under you anyway?

Exactly. All of us were pretty bummed. We were in Mexico at the time and although the owner said she would never sell as long as she was alive, the owner's son sold to a corporation instead of giving the tenants the first right of refusal. We received an email about the transaction...

However, I take the view that all things work towards the good. To do otherwise gets me too stressed!

Hey, guys, thanks for the challenging discussion!

Be well,
Akaisha
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