One of the things that make investing in real estate so great is that there are many ways to be successful. There are investors who focus solely on multifamily properties and apartment buildings while others target single families acquired through tax lien sales. Whatever niche you are comfortable with can work for you in the right area and with the right mindset. One of the more increasingly popular niches deals with mobile home and condominium investing. There are investors who will shy away from these types of properties. However, those who focus solely on them have shown they can be a very viable investing option. It literally pays to look into alternative real estate investment strategies.
The biggest knock on these properties is the small amount of margins due to lower sales. While it is true that most mobile homes and even condos are typically priced less than single family properties, there is still money to be made. The key, like any other real estate investment, is finding the right property with the right demand. If you have never looked at this niche you may not realize that the market is bigger than you think. Not every first time home buyer can afford the down payment or even monthly payment for a single family property. Since many of these properties fall under $100,000, they cater to that market and can be quite popular in certain areas.
While the end sales prices may be relatively low, so is the purchase price to acquire them. This can be the ideal investment for someone just starting out on a limited budget. They probably won’t retire with the profits they make, but they can learn the ropes and develop a portfolio. Since not every investor looks at these properties, there is usually less competition and more of a chance that their offers will get accepted. Closing five smaller deals a year may be better than just waiting for one big one to fall on your lap.
Like any other property, there are distressed sales and opportunity to buy at a discount. The major difference is that condos and mobile homes typically have an association they are affiliated with. This could cause some issue at closing in regards to the number of owner occupied units and association insurance liability. The other major knock is that since many units are close proximity, one low sale has an impact on every future one. Of course there could be extenuating circumstances surrounding one specific sale, but if an owner wants to take less to sell it could take a few higher sales to offset that.
Instead of looking at condos and mobile homes and thinking how little you would make with them, you could think about little competition there is and how you can corner the market. Like everything else in real estate and every new property that comes your way you should do your due diligence and see if it is right for you. Before you quickly dismiss condos, mobile homes and every other alternative property spend the time and do your homework. You just might find that this is a niche you enjoy and can make money on.