What makes one mobile home park more occupied than another? What qualities do you need to instill in your own park to make it more desirable? In this episode of our five-part series titled “Lessons Learned from our Residents” we’re going to examine exactly what the hot-buttons are for the consumer in selecting the right mobile home park to live in. Even though the level of competition in mobile home parks is relatively low, it’s essential that you make any property as desirable as possible, and stay away from those that lack the basic raw material to be “in demand”
What makes customers choose one mobile home park over another? What can you do to make your park more likely to be chosen? In the second of our five part series on Lessons Learned from Our Residents, we're going to discuss exactly what the park selection criteria is in mobile home parks in the United States. We're going to go over things you should do to make your park more desirable.
Let's start with the macro issues. There's basically two types of mobile home parks that people like to live in. The first ones that are in a good desirable school districts that have lots of charm, they're quaint, safe. The kind of suburbs you yourself would like to live in. The other are more urban parks. These are just like millennials wants today. Parks that are right on the fringes or inside of downtown, and have lots of offerings, and things going on around them. It's basically the exact same macro subset of all housing in general. You, yourself, would probably choose, if you had to, one of these two areas to live in over any other. The good suburban school districts, safe, nice place to raise a family, high quality of life with safety. Or that urban area that's a little edgier, a little more exciting with more things to do immediately surrounding it.
So, if we agree that those are the two macro things that our customers desire then what are the micro-items that affect their judgments? The first, of course, would be the first impression, the appearance of the property. That's why it is so critical that you always give your property a really nice looking entrance because that's where the first impression is set. You don't get a second chance at it, people make their first impression and it doesn't ever get any better or often any worse, so you've got to really come out of the chute with all your might and provide a really, really good attractive entry to let the customer know that this is a nice, quality place to live.
The second micro item on park selection are the streets. Customers don't really care, to be honest with you we've been doing this for over two decades, and in most cases they don't really care whether the streets are gravel, or paved, or concrete. That's not really a huge item to them. What's more important to them is that they be free of potholes. Think about yourself, when you drive around what annoys you more than anything in the world? I can tell you, there's two things. One, potholes, and the other is an unusually large number or unusually large size of the speed bumps. If you could provide streets that are nice and flat and don't annoy people you're pretty much in the end zone.
However, I think all cases being equal, most customers would like the paved surface better. It's smoother, and it looks more professional, it doesn't cast any dust, and they sometimes don't like the little bit of rumbling you get when you drive down streets that are not fully paved. Between pavement and concrete, don't think they really care much at all, but the bottom line is if you want to have desirable streets, if you want to be desirable to customers you have to be free of potholes and speed bumps.
Now, what about speed bumps? Let's talk about that for one second. Speed bumps serve an effective purpose, but yet they're really not that effective in most mobile home parks. The reason is we don't typically have really large curves. What happens is the customers will tends to go around those speed bumps, and why would they not? There's really nothing, no curve to run over with your wheels to, again, but them. What you end up doing is you'll have situations in mobile home parks often where there's this kind of road system that goes around the speed bumps, it's just this muddy hole. If you're going to have speed bumps understand they're really only there to try and slow traffic. Don't be obnoxious and add lots of them and don't let one's be there that are so large that people will deliberately drive around them and/or even drive over them and damage their car. Speed bumps don't always help you in this desirability regard.
Number three, you always want to have access to city services. There's no kind of park less desirable to the typical customer than the truly rural item that is found sometimes way outside of civilization, 20, 30 miles out. If you have to get in your car and drive 20 miles to the nearest grocery store that's obviously not going to be a turn on for almost anybody. You've got to have good access to services. What are the services people need to? What do you need? You probably want access to groceries, you want access to probably a Walmart or some way of shopping for household items. Maybe access to a dry cleaner, these are the things that are important whether you live in a mobile home park or a McMansion subdivision, so you want to have those kinds of access to services.
The next is a simple one, city water and sewer. Everybody likes the safety and the confidence of city water and city sewers, so it's always great when you can provide that because that is an important item to nearly everyone in America. You want to know that when you turn on the tap nice, safe, potable water comes out of the spigot with as much as you can possibly desire.
Next, the neighborhood demographics. People like to be in neighborhoods that are attractive to them. They like to be in an area that they feel has some degree of charm and class, and being relatively upscale. So when you're looking at neighborhoods remember that mobile home park residents want to live in the same kind of neighborhood you want to live in, so you've got to provide that. When you're looking at parks to buy, and you want to have a park that's highly in demand make sure that you're buying it in a neighborhood that would be highly in demand. We like to test that always through our test ads. That's why we love doing test ads before buying a park. We put the name exactly where the park is located in that ad and then we see how many calls we get over a measured span, typically of 10 days. The whole point of that is we want to make sure that our location is a plus.
Remember the old adage in real estate, location, location, location? It's as true in mobile home parks as it is in apartments. You've got to be in an area that is desirable for people. I would also add that you can't really change location, that's one factor you can't. You can go in, and you can mow all the grass, and change the entry, and do all kinds of wonderful things, but you can't change location. There's no way you can go in there one weekend with a couple helicopters and pick your park up and move it to a move to a more desirable spot, so you got to make sure you have an attractive neighborhood demographic.
Next is the mixture of age of homes in the property itself. Picture this, you driving in a mobile home park thinking, "Do I really want to live here?" What do you see more than anything else in a mobile home park? You see a lot of homes, they're very high density. Typically, you're seeing just the ends of the homes 2 probably the first 20 feet up the side of the home when you look at those homes, or those homes you want to live amongst the, or those homes you're horrified by. Now, most of our customers are pretty open-minded on the age of homes. As long as they're in good condition, typically, 1960s, '70s homes are okay, but yet they want to see that a mix of affirmation that the place is still desirable, so they like to see some pitched-roof '90s models and 2000 models in there. You also would like to see a little vinyl sided shingle roofed action because they know that's the newest kind and, again, that affirms to them this is an okay place to live.
The hardest thing, if you're looking at the sheer park attractiveness to the consumer, is the park where you've got nothing but old flat roofs, just a sea of 1950s and '60s flat roof mobile homes. It just does not turn on the customer because they're thinking, "Gosh, is this park just kind of old and worn out? Are there any new homes coming in? Are there any new people coming in?" We just prefer a nice mix of homes. We like to have flat roofs, round roofs, pitched roofs, homes from anywhere from the '50s all the way to modern, but we do like to have that mix. We think having a mix is very, very important on park selection criteria.
Another item, if people drive your park at tonight which they surely will many customers many of your customers are going to go check this thing out not only in the day, but also in the night, you need to make sure your park has sufficient ambient light. What does it mean? It's very subjective. Ambient light means basically, how much light is cast from the general activities of streetlights and home lights to give it a pleasant and safe feel. Nobody wants to live on a property that is completely dark. It's scary. It's scary to get out of your car when there's no light around. Who's in the bushes? What's going on? You want to have a fair degree of ambient light. Now, unfortunately, there is no scientific measure of ambient light. You can't go buy an app for your phone that measures ambient light and I can't tell you, "Yes, you need to have such a degree of ambient light and if it's beneath that don't buy it." You yourself know ambient light because you y ourself know what you find and feel safe yourself.
Also, make sure if possible, if you already have bought the park to get some lights on your entry. Nothing speaks more to the fact that this is a desirable place and we really want your business than when you have the pride enough to light your sign. How do you do that, however, if there's not a lot of electricity around? One option that many park owners do is to explore some of these Gama Sonic solar lights. We've done that as well. You can put those at the entrance and they don't require any wiring.
We did them in a park we have out in Illinois and it worked out fantastically. We had a non-light sign on an island, no way to get power to it. It would cost a fortune. You'd have to trench through your streets and we'd have to bring the power in from hundreds of feet away. It'd be very, very expensive. Instead we bought Gama Sonic's brightest solars, coach lights and put them on either side of the sign. Not even just a single light coach lights, these have three lights each, and it has a great effect. It lights the sign as you're coming down the frontage road you see those lights and those lights to create ambient light to the sign, so it gave us a very, very classy entry at a very low cost. You can buy the Gama Sonic units for roughly $300 each.
What's amazing is, number one, they require no wiring, that's the big one. Also, they basically turn on automatically when it gets dark, and they run until the power runs out, which is typically long after anyone would drive into your park. Third item is they seemingly never break down, so that's why we've been using them a lot because they never break. We've never had one break yet. You got to have enough light on your park because don't just assume all residents will come in and look at that property during the day. They will, they're going to go during the day, but they're also going to come back at night. You've got to make sure that you can offer what they need and what they want is safe ambient light and, additionally if you can do it, a nice light at entry.
Next item in their park selection criteria, of course, is price. Let's talk about price for a minute here. It's crazy if you think people in the affordable housing specter don't make judgments based on pricing. However, I can tell you right now after doing this for over two decades, that pricing that they're looking for is not always the cheapest pricing. What they're looking for is the overall value. If you have a nicer property that scores well on everything I've talked about they're willing to pay a little more for that. Who wouldn't? People always don't mind paying extra for a good value. You yourself probably don't eat at the cheapest restaurant every day nor do you stay at the cheapest hotel when you go down the interstate. I'm certain when you exit where all the hotels are you probably don't go to the Tiki Motor Lodge for 20 bucks a night, but probably instead seek out the Hyatt Place or something that's a little more expensive, but certainly a l ot higher quality and definitely a better value.
Also, remember that in park selection criteria customers want to know not only the price of the rent, but also whether or not it includes utilities, so make sure when you're figuring out your pricing and you're trying to be insanely great, to quote Steve Jobs, look at the comps of all the other parks and make sure you've included what's included in the rent. Make sure there's apples to apples in your comparison, and then strive to create a really, really terrific value for people. As long as you have a really good value you're going to have a high level of demand.
Finally, the sense of community. Everyone knows of that Time Magazine article, because I have talked about it 50 times now, and it's called The Home of the Future, it came out in Time Magazine over the last year. It was a very interesting article because it declared the mobile home parks are like the gated communities of less affluent. Now, I don't know if I agree with the less affluent. We have many properties that have people who are not highly affluent, but fairly affluent. That was probably not a fair statement on the part of Time Magazine. Nevertheless, it is completely true that people do prefer properties that have this sense of community, this support network, this neighborhood bonding that people are taking care of each other, and watching out for each other.
It's a very, very potent force in park selection because, frankly, people like to live around people that they like. Who doesn't? Who wants to live around grumpy neighbors who don't care or know who you are? You can find those all day long in any apartment complex, of course, but in a mobile home park you've got actual home owners who do actually care, and care about you, and share a common purpose, and live shoulder to shoulder trying to provide a very high quality of life for them and their families.
Basically, always seek out properties that have a high sense of community, and if you buy a property that doesn't try and build it. Try and create a sense of community. How do you do that? I've talked a lot about it, but quickly again, what you need to do is you need to find ways to bring people together with a common purpose of just intermingling, learning about each other, areas that they can congregate congregate people. Put in picnic tables, put in a grill, create activities for them, take your clubhouse or a structure and build a room where they can go in and and read and meet each other and maybe hold a party. What's a very big topic for all park owners right now is how do we build this most important of all amenities, the sense of community? When you have a property that has a strong sense of community you'll find you never have any vacancy because people are extremely appreciative of that.
Again, I hope you enjoyed this, our second in our five-part series on Lessons Learned from Our Residents. We'll be back shortly with another episode, this one on the home selection criteria of our residents. This is Frank Rolfe, and we'll talk to you again soon.