What You're Actually Buying When You Buy a Mobile Home Park

Most first-time buyers walk into a park acquisition with a fuzzy mental model of what they’re buying. They think “I’m buying a mobile home park” and assume that’s specific enough. It isn’t.

The components vary deal to deal, and the variations drive both your operating costs and your financing options. Be precise about this before you sign anything.

What you’re always buying

Every MHP acquisition includes four things:

The land. The actual acreage the park sits on. You own it; residents lease pad sites from you.

The pad sites. The individual lots where homes are placed, with utility hookups (water, sewer, electric, sometimes gas) at each pad. The number and size of pads is the foundation of your income.

The utility infrastructure. Water lines, sewer lines, electrical distribution, and roads from the property entrance to each pad. This is the part of the park that most quietly drives or destroys returns.

The income stream. Lot rent paid by residents who own their homes (TOH — tenant-owned homes) or by residents who rent both the lot and the home together (POH — park-owned homes).

What you may or may not be buying

This is where deals diverge.

Park-owned homes (POH). Some parks own a portion of the homes and rent them out as a package with the lot. Higher gross income per pad, but you take on the home as an asset, the maintenance, the depreciation, and the turnover risk. Heavy POH concentration also blocks agency financing — most agency programs cap POH at around 25–35% of the park, depending on lender and structure.

The water and sewer systems. Some parks are on city utilities (water comes in from the municipality, sewer goes out to the municipality, you bill back to residents). Some parks have private wells and septic systems, which you own and maintain. The difference is significant for operating costs, capital reserves, and lender risk view. Private wells and septic are not deal-killers, but they require pricing in.

The roads. Internal roads in most parks are private. You own them, maintain them, repair them. Paved roads in good condition are an asset. Gravel roads with potholes are a near-term capital expense.

Amenities. Clubhouse, pool, laundry building, mailroom, storage units. The more amenities, the higher the operating cost and the more capital reserves you need. A 55+ park with a pool, clubhouse, and organized activities is a different business than a no-frills all-age park.

The cleanest deal vs. the messiest deal

The cleanest deal: land + pads + city utilities + tenant-owned homes + minimal amenities. Predictable expenses, straightforward financing, low operational complexity.

The messiest deal: land + pads + private well/septic + heavy POH concentration + a pool that needs replacing. More moving parts, more capital required, more specialized financing.

Both can be profitable. The pricing has to reflect the complexity, and the financing path has to match the deal profile.

Why this matters for your offer

Two parks with the same lot count and the same lot rent can be wildly different investments. A 60-pad park with city utilities and 95% TOH is a different deal than a 60-pad park with private septic, 40% POH, and a clubhouse that needs $80K in deferred maintenance.

When you’re evaluating a deal, list every component above and be explicit about what’s in and what’s out. That list drives your underwriting, your due diligence priorities, and your financing options.

If you want help thinking through how a specific park’s composition affects financing, send me the OM and the rent roll. I’ll come back with a plain-English read.

→ Next: The Five Numbers That Tell You If a Mobile Home Park Deal Is Real

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Amy Brown · NMLS #2310281 · NEXA Lending. Commercial financing available nationwide; residential licensure in MD and FL. Educational guidance only; not a commitment to lend. Terms, rates, and program availability subject to change.