Mobile Home Park Investing Newsletter

In October of 1908, Henry Ford introduced his new Model T to the American consumer and the rest was automotive history. What made the Model T so successful was the fact that it was affordable transportation, made possible by the invention of mass production. But Ford had something different from other auto manufacturers of the time, reflected in this statement he gave upon the Model T’s introduction:

I will build a car for the great multitude. It will be large enough for the family, but small enough for the individual to run and care for. It will be constructed of the best materials, by the best men to be hired, after the simplest designs that modern engineering can devise. But it will be so low in price that no man making a good salary will be unable to own one – and enjoy with his family the blessing of hours of pleasure in God's great open spaces.

That’s the same mantra that successful mobile home park owners should embrace. We’ve been saying for two decades that our industry mission should be to create a safe, clean and affordable place to live. Sounds like Henry Ford would agree.

Elkhart, Indiana is known as the RV and MH Capital of the World. More than 80 percent of global RV production is based throughout the region, as well as a significant part of mobile home manufacturing. We are one of the largest buyers in the U.S. of Clayton’s Wakarusa plant mobile homes, which are built in Elkhart. Even the industry museum – the RV/MH Hall of Fame and Museum – is located in Elkhart. But why is Elkhart so dominant in this industry?

Early pioneers began there

Three of the dominant players in the RV industry all began in Elkhart in the 1930’s: Milo Miller, Wilbur Schult and Harold Platt. As their businesses grew, many employees would quit and start their own similar product lines. Even a local tavern keeper started building trailers behind his bar, and that grew into Skyline – a giant fixture of the industry. By 1948 there were over 100 trailer manufacturers in Elkhart, and it became known as the “Trailer Capital of the World”.

Great access to transportation

It takes a lot of raw materials to build an RV or mobile home. Steel, lumber, and related parts. These are heavy and bulky. But this is cured by a large railroad presence in Elkhart, as well as the interstate highway system that passes through. And this became valuable not only to bring parts into town to transform into finished trailers, but to ship those trailers out to customers. In fact, Elkhart as one of the largest commercial railyards in the U.S.

Specialty skills in abundance

The reason that Elkhart maintains its industry dominance is the fact that the assembly of RVs and mobile homes requires some extremely specialized skills, and the Elkhart labor pool is full of these type of employees. If you tour the manufacturing line at Clayton, you will see that it includes a large number of welders, framers, electricians, plumbers – all skills that need significant training. It also involves an assembly line process where speed is of the essence. What this translates to is a high-paid workforce that revolves around generational skills sets that you can’t find in other markets.

Conclusion

Elkhart, Indiana is indeed the Trailer Capital of America – and that’s for both RVs and mobile homes. It offers a highly skilled labor force, significant access to rail and highway transport, and a culture that is devoted to this unusual sector of the manufacturing industry. If you’ve never been to Elkhart, you should consider going to the RV/MH Hall of Fame and Museum.

We’ve all seen the episodes of COPS where they delight in focusing on “trailer parks” as the catalyst to non-stop sex and violence. However, contrary to what television audiences think, this portrayal is not based on fact. Duke studied the issue and here were their findings after exhaustive research. And here’s an even larger study done by the University of Illinois for HUD, which comes to the same conclusion after even more research. What both reports say is that there is no greater correlation of crime in mobile home parks than there are in surrounding subdivisions and apartment complexes. So why would that be the case?

The community is vigilant against crime 24/7

Anyone who has ever driven into a mobile home park knows that you suddenly see a large number of people looking out of windows, between mini-blinds, on all sides of your car. Mobile home parks are extremely vigilant against strangers and potential crime. The recent article in Time magazine titled “The Home of the Future” declared that one of the biggest strengths of the mobile home park is the sense of community – the innate support system that, the writer said, makes them ‘the gated community of the less affluent”. In this way, a mobile home park is a giant congregation of sentries who are watching out for crime at all times. And that’s a terrible environment for criminals to survive in.

Mobile homes are a terrible residential option for criminals

If you do bad things – if you have enemies or a warrant -- a mobile home is the worst possible housing option. There are two simple reasons: 1) mobile homes have very thin walls and doors that cannot possibly offer protection against an armed assailant and 2) you have the ability to approach a mobile home for all sides, including above and below. Assuming that the average criminal wants to feel “safe” in their hideout, then there’s no way a mobile home is an option. Criminals want solid masonry walls and limited points of entry. A mobile home offers neither. Hollywood must have figured this out, because there’s never been a gangster movie where the gang operates out of a mobile home park.

Apartments are where the real crime is

So if mobile home parks are not where the crime is, then where is it? We all know the answer: apartment complexes. The government knew that before they hired the University of Illinois study, but nobody wants to talk about it. HUD’s Section 8 program has been tied to apartments for decades, as have the tax credits and other financial relationships between the government and multi-family. To admit that apartments are tied to crime would insult their best allies, as well as cast suspicion on how well the subsidized housing programs are doing. But everyone instinctively knows the truth. Think about the most dangerous place in your city or town. Is it that apartment complex? Of course, it is!

The high percentage of retired individuals is an extra deterrent

Mobile home parks have large numbers of retired individuals who are home all day. This adds an extra deterrent, as these folks are very proactive about watching over their homes and communities. If all residents were younger and employed, there would be times of the day when everyone is at work, but in a mobile home park that time doesn’t exist. And criminals know this.

Conclusion

Mobile home parks are not dangerous. They are not centers of crime. Not even close. Not only is this the finding of many expensive studies, but it’s just common sense!

We first ran into Gama Sonic Solar products at the Las Vegas MHI Show four years ago. It was the only booth at the show that was packed, as everybody was looking at these lights.

The concept of lighting in mobile home parks is not new – but doing it with solar energy is. Here were standard coach lights – a regular fixture in many parks – that required no wiring and were incredibly inexpensive. We bought a ton of them right on the spot. Dave even put some in his yard in Cedaredge.

What separates these from typical solar lights is that they are so bright, they look exactly like traditional wired units, and when you run the math of using a Gama Sonic unit or buying a regular fixture at Home Depot, it’s the cost of wiring that makes all the difference.

By going solar you save around $1,000 per fixture in the cost of wiring and connecting to the power source, which means that you can put expensive-looking ornamental lights at your entrance and throughout your park for a ridiculously low amount of money.

Their Imperial II model is the brightest solar lamp in the U.S. It’s made of powder-coated cast aluminum and has a patented prism technology to disburse more light. At 300 lumens, each lamp has the brightness of a 50 watt bulb – unheard of with solar units in the past. That model is called the GS-97N, and we highly recommend it.

In addition, once this model has been fully charged in the sun, it will last all night every night, up to 6 nights on a single full charge, offering you true dusk to dawn illumination.

We have two Gama Sonic GS-97N flanking our sign on the frontage road, and it gives our residents a great drive-in appeal both day and night and these units look to our residents like they cost five times more than they really did – and that’s assuming we could have found a power source to reach our entry, which would have cost thousands to trench and install.

It’s also worth noting that these units are commercial grade and turn on and off automatically and they come with a two year warranty.

All in all, a fantastic product for every mobile home park application.

To discuss this product in more detail, contact [email protected] or at 678-736-8303 x 104. Also, visit this landing page for more information www.GamaSonic.com and tell them that Frank & Dave sent you.

Our normal budget to renovate a used mobile home is $4,000. That’s parts and labor. Obviously, that would be a joke if we were talking about a stick-built home or an apartment. But mobile homes are extremely inexpensive to rehab for a number of reasons, and that is a definite advantage as a landlord. So how do we do it?

Easy access to ducting and plumbing via the “trough”

Unlike a home or apartment on a concrete slab foundation, a mobile home is set upon a chassis. And unlike pier and beam construction, mobile homes have plenty of crawl space that allows for easy access. On top of that, all of the ductwork and plumbing flows through a central cavity called the “trough” which runs below the floor of the home. Access to the “trough” is easy through the insulation, and everything is clearly marked and simple to replace.

Simple bathroom construction

Except in rare exceptions, mobile home bathrooms are as simple as they come. No tile. No giant tubs or showers. Inexpensive fixtures. Nothing more than a toilet, sink and tub/shower combo with a shower curtain and vinyl floor. Basically the exact opposite of the typical stick-built bathroom. You could not even replace a Kohler toilet in your house for the cost of complete replacement of the typical mobile home bathroom.

Simple kitchen layout

Just like the bathroom, this other common repository of huge renovation funds in a stick-built dwelling is super inexpensive in a mobile home. Counters are always linoleum and never granite or marble. Cabinetry is never actual wood and the kits are available at Home Depot – and there are never many of them. Appliances are normally all electric and simple – no Viking ranges or wine refrigerators. The floors are always vinyl and sit upon simple plywood.

No load-bearing interior walls

Mobile home walls have no load-bearing attributes (although they do have some in double-wides). As a result, you can move interior walls around with abandon, since there’s no structural concerns. Ever seen the episodes on HGTV’s Flip or Flop where they have to augment the beam with a steel section costing $10,000? That’s not the case here. In addition, there’s typically no wiring in the interior walls. They are truly just for looks.

Inexpensive flooring

Mobile home flooring comes in two styles: carpet and vinyl. There are the two cheapest surfaces in existence. No tile, marble or hardwood. As a result, you can use carpet remnants and other surplus materials, as well as inexpensive products from Home Depot or Lowe’s that they will even install. And removal of what’s there is incredibly fast and simple and requires no costly demolition. And the cost of flooring is coming down, as the latest trend is vinyl throughout the entire home, augmented with area rugs – if that’s desired. As a result, the floors are more durable and not subject to stains or pet odors.

Inexpensive parts

All the parts for a mobile home can be found at Home Depot, Lowe’s or a mobile home supply dealer. No trying to match $1,000 cabinet pulls or replacing a chandelier. You can literally go to Lowe’s with $100 and walk out with all the parts you need plus change. The two most expensive items in a mobile home are the furnace and central air-conditioner. But, in many mobile homes, even these are being replaced with $600 window heat/air units.

Lower expectations

Mobile homes are all about affordable housing, not Architectural Digest. Customers are happy with a nice place that meets their budget. They are not trying to be on the cover of Town & Country. The same issues that would result in customer unhappiness in a stick-built house, condo or apartment are non-issues. That’s not because the customer is less demanding, simply because they understand that they are getting a great deal and are appreciative of that.

Conclusion

Mobile homes are extremely inexpensive to renovate. It’s built into the design, and it’s a huge reason that affordable housing is alive and well in mobile home parks.

Obtaining a loan for a mobile home park can be difficult and time consuming if you do not know how to build an effective loan package, or which lenders to hit. And then there’s the unpleasant task of meeting with lenders and dealing with rejection, as well as knowing what terms are negotiable and how much you can push them. What’s the solution? For smart buyers, it’s MJ Vukovich at Bellwether Enterprise. MJ is one of the top loan brokers in the U.S. He goes out and gets the loan and all you have to do is pick which bank you want to go with from those that want the loan. It’s fast and painless, and the fee is around 1%, which is a real bargain. Best yet, you only pay on performance, with the fee due at closing. We’ve been using MJ with great success, and his real strength is in the “agency debt” arena with Freddie Mac and Fannie Mae, where his firm is a leading underwriter. Best of all, MJ is a third generation park owner, who understands the business and looks at the entire process from your perspective.

To get ahold of MJ Vukovich for questions or to get the loan process going, email him at [email protected] or call him at 612-335-7740. Let him know Frank & Dave referred you for VIP treatment. And let us know if your loan closes and we will send you a $500 gift card to the home improvement store of your choice to get you started on your park renovations.

Do you ever drive through mobile home parks and wonder what they looked like a half-century ago? Well, here’s a glimpse of Elvis inside a mobile home park from the 1963 film “It Happened at the World’s Fair”. Elvis lived in a mobile home park twice, the other film being “Speedway” in 1968. Note that the mobile home was very similar in design element to the car parked in front. It was a time when America was trying new things – from air-conditioning to the Beatles – and living in a home that was on wheels seemed like a cool idea. Mobile homes have been a part of American culture for a half-century and, until recent times, always portrayed by the media in a positive light. If it wasn’t a cool product, Elvis would never have lived in it on the big screen.

Whether you are simply in need of an insurance quote or you have the unfortunate, yet common task, of filing a claim, Mobile Insurance is ready and waiting to take your call. We’ve used Mobile Insurance for over a decade, and their superior service is known throughout the industry. Kurt, the owner of Mobile Insurance, is a top resource for any park insurance question, and they provide free quotes on parks that you are acquiring. That’s why around 2,000 park owners in the U.S. are Mobile Insurance customers.

Mobile Insurance can help you engineer the policy you need to cover all your concerns, and their prices are unbelievably low. Being able to contact them when you need them is just as important. We recommend that every park buyer call them first, as we know of no other group that has the same expertise, quality of service, and low prices. Call them at 800-458-4320 or email [email protected].

“Waffle House where the customers are chained to the booths”. This was part of a wider quote that compared a mobile home park to a Waffle House. I explained to the reporter that when you buy a Waffle House, you don’t have any idea if there are any customers coming in the door ever again, so your investment is a huge risk. However, with a mobile home park, you know exactly how many customers you will have each day – it’s the same number that you had the day before -- so your risk is very small. I also used the analogy that restaurants fail at a higher rate than any other type of business, but mobile home parks have the lowest default rate of any commercial loan type, due to this revenue stability. Of course, the reporter took my quote completely out of context, but the fact of the matter is that it was 100% correct – mobile home parks have incredibly stable revenue streams. So what are some of the other reasons that we can buy mobile home parks and sleep at night?

Revenue that can be quantified

When you buy most businesses, you are taking a huge leap of faith on revenue. But with mobile home parks you can simply count the number of homes in the park, multiply by the lot rent, and you already know the monthly revenue. We’re not sure if any other business model in the U.S. can boast such a simple formula. And that is a key reason that we can buy mobile home parks and sleep at night.

No reliance on past numbers – if they’re even available

Because of this “you get what you see” format on calculating revenue, the past financial performance of the park is not critical. And that’s a good thing, as many moms and pops will present the buyer with financials that are written in crayon on notebook paper. Even appraisers are willing to forego past financials in favor of a more accurate accounting of current occupancy and smart estimates of operating costs. If we had to rely strictly on the seller’s numbers – without any concrete demonstration of those facts – there’s simply no way we could buy mobile home parks and sleep at night.

Diversity of revenue

When you invest in a shopping center, you have just a hand full of tenants. When you buy an industrial building you have one tenant. But when you buy a mobile home park, you have a broad base of diversified renters. This is extremely important. When you have a 100-space mobile home park and lose one tenant to non-payment, you have lost only 1% of the revenue. But when that five-tenant shopping center loses one occupant, you’ve just lost 20% of revenue. The benefits of diversification are not lost on mutual fund investors, and the same is true when we’re buying mobile home parks.

The ability to re-create the expense categories with perfect accuracy

While a mobile home park buyer can nail the revenue with a high level of accuracy, they can also hit high levels of correctness on the expense categories. The expense line items on a mobile home park P&L are relatively few, and this allows the buyer to obtain either the actual numbers from the provider (such as water & sewer costs), or to get three bids on those that the current owner was not using (such as insurance or mowing). This allows us to sleep at night, knowing that our budgets are accurate.

Little opportunity for seller fraud

Since a smart mobile home park buyer can recreate both the revenue and expenses using their own due diligence – and without relying in any way on the seller’s materials – there is little risk of seller fraud. If you’re told that there are 48 lots occupied and you only count 46, then that misrepresentation will be caught early on. If the seller says that the electrical bill last year was $4,500 but you call the power company and say $5,400, then you again avoid falling into the trap. As a result, it’s a rare moment when a seller can fool you into overpaying for the property, and that’s reassuring.

Industry norms that help to bracket a normal range of NOI

Mobile home parks have been analyzed for a half-century, and their operating numbers tend to fall in established ranges of normalcy. This allows the buyer to immediately determine when projections are overly optimistic. The normal expense range for a mobile home park is 30% to 40%. The fact that there has been enough analysis of this sector to derive simple performance guidelines is very helpful when it comes time to sleeping at night, because you know that the path has already been blazed to making money with these assets.

Conclusion

Mobile home parks have a huge advantage on all other types of real estate when it comes to sleeping at night. You can nail the revenue and expenses during due diligence, and check to see if the park meets standard guidelines. Unlike the poor sucker that has to buy a restaurant based on complete reliance on the seller’s financials (which may be completely imaginary), mobile home park buyers have a crystal clear handle on numbers and, as a result, the anticipated performance of the asset.

If you enjoy this monthly newsletter, then you will certainly also like the Manufactured Housing Review – the industry’s only monthly magazine that covers many different industry topics. Edited by our friend Kurt Kelley of MobileInsurance, MHR offers many insights and opinions that reflect current events in the affordable housing industry, with no topic taboo.

To view this month’s issue, click here!

How many deals have you seen go down the drain because there was attorney involved that stacked up a million roadblocks to even the simplest problems, and then failed to offer any path to solving them? This is called “deal killing” and some attorneys do this so that they take no risk – if the deal never happens, they can never be criticized for missing a deal point, or for not spotting a flaw in the contract. The problem with this, however, is that you can’t get anywhere in business if you can’t move forward on a single property, regardless of how good the economics and market are. At the other end of the spectrum are the “deal maker” attorneys that recognize real problems from trivial ones, and strive to solve these roadblocks using common sense and legal experience. And the best of those type of attorneys is Dave DiMarco from Woods Oviatt Gilman. We once had a deal go south in a big way – the very driveway into the property was determined to be on somebody else’s property. Any other attorney would have said “well, that’s it, the deal’s dead” but Dave DiMarco sprung into action. We located the owner, negotiated a purchase, personally handled the details, and the deal went forward. And all that over a weekend, no less. And that’s why we love Dave DiMarco and you should, too.

If you need service like that, then consider using Dave DiMarco on your next transaction. You can reach him at (585) 987-2833.

There is perhaps nothing more depressing than a typical mobile home park office. Cinder-block walls devoid of any artwork, broken low-quality office furniture with poor lighting – this is what most customers see upon their arrival. And that’s a terrible business decision. First impressions are critical to the success of your property. So how should a park office be decorated?

Make it a place to be proud and create a good first impression

Are you proud of your park office? If not, then what are you thinking? This is your first point of entry for the potential resident, and that important first impression is formed there. While we’re not suggesting that you spend the capital to build a palatial room for your manager to greet prospects, you need to make the best of what you have. That should include matching pyramidal shrubs flanking both sides of a well-painted structure with tasteful shutters and matching door. Decent flooring and fresh paint, with all the bulbs in those recessed cans replaced with brighter LED. And replace that broken old furniture with some new – and modestly priced – items from Office Depot. Don’t stop until you are 100% proud to walk into that office.

Make it upbeat and friendly

The above photo is from our Highland Estates office in Indianapolis. It was a typical boring office with beige walls and zero artwork. Instead, we re-painted it bright yellow and added some seating areas for residents to fill out applications. The more inviting the office, the more likelihood the customer will hang out for a few minutes and give some serious

Personalize it

Don’t keep the environment sterile. Let your manager put some of their own personality into the space. This gives the customer the subliminal message that the manager has “pride of ownership” in their job. It also is an ice-breaker for conversation, and gives the customer a the feeling that the office is people-oriented and friendly.

Literature rack

Most every park office needs a literature rack – someplace to put all the flyers and handouts that the customer needs. Application forms, sales flyers on homes, different clubs and organizations to join – that’s all stuff that helps close the sale. Without the rack, your manager is fumbling around file cabinets or – even worse – can’t even find what they were trying to give the customer, and the momentum is lost.

Conclusion

If you have an office in your mobile home park, use it effectively. Make it an asset that you can be proud of, and an effective tool for the manager to conduct business. It’s inexpensive and highly effective.

Have you seen the new mobile home commercials during college football? They’re the talk of the industry. Here’s one of them that appeared during a high-viewership game recently https://www.dropbox.com/sh/ovv7h090x9oytkf/AADrly9lfYK0ZCTaidFwTeC7a?dl=0&preview=HaveItMade_60_4CLA7005000H_UNSLATED.mp4 . These are the brainchild of Clayton Homes, and are an important milestone in industry history. I believe that these are the first mainstream industry promotional advertisements in the last several decades. While the RV industry has been airing their “Go RVing” ads for several years, the mobile home industry failed to follow suit. Until now. It’s a shame that Clayton had to run these ads by themselves, as they clearly benefit all mobile home manufacturers, dealers, and park owners. As a result, we are all riding on Clayton’s coattails, and should at least give them our support in this endeavor to educate the American public. All we can say is THANK YOU CLAYTON HOMES!

For more information on Clayton and 21st Mortgage's CASH program to fill vacant lots, call Candice Doolan at 800-955-0021 ext 1735 or email her at [email protected].

We’ve been buying and operating mobile home parks in Dallas for over two decades. It’s one of our favorite markets. But why is that? What makes Big D such a great market for mobile home parks?

Great population stats

While Dallas has a giant population on its own at around 1.3 million, the metro is over 7 million. Although we have done well with metros of around 100,000, there’s no question that bigger is better and Dallas has a giant metro population. In fact, it’s the largest city in the south, and the fourth largest in the U.S. As a result, there is a huge economic engine that results in a constant flow of new residents looking for housing, and a continual upward movement in rents due to supply and demand.

Strong housing prices

The median home price in the Dallas metro is $186,700 and average three-bedroom apartment rent is $1,305 per month. This has created a huge demand for affordable housing, where the bottom third of wage-earners are priced completely out of the market. While markets work fine with median home prices of around $100,000, twice that number makes the phone ring even more.

A recession-resistant economy

Dallas has an unemployment rate of 4%, compared to the U.S. average of 5.2%. But that’s not the whole story. Dallas has a very diversified economy that has proven to be extremely recession-resistant. It has no less than twelve colleges. A huge number of regional hospitals, from Parkland to Baylor. And one of the highest concentrations of corporate headquarters in the United States including Exxon, Toyota USA and Southwest Airlines.

A “sexy” market

By this we mean that Dallas is highly sought after by buyers and lenders, and is a very liquid market where parks are easy to sell and finance. When you tell a broker that you have a park in Dallas that you want to list, there is virtually a bidding war for that listing. Even in more marginal suburbs of Dallas, you find demand extremely high simply by association.

Conclusion

Dallas has been a highly successful mobile home park market for decades. It’s rapid growth in population and stature has been a huge driver to healthy lot rent increases and park owner success stories. Frank’s first park was in Dallas, and Dave has been an investor in the city since the 1990s. If you have the opportunity to find a park in the Dallas metro, you should give it extra consideration.

When it comes to Phase I Environmental Assessments, nobody in the industry is more knowledgeable than Mike Renz. He’s our go-to guy for all things pollution-oriented, from Phase I reports to simply asking questions on what we see going on next door to the property (or even inside that concerns us). We were once walking through a property and saw a brown colored solution oozing from the property. Within minutes, Mike had pulled up the data and figured out what it was (rusty water from an iron-ore- rich artesian spring). That’ the kind of information that we find invaluable in today’s litigious world of environmental condition. On top of that, we’ve had Phase I reports that failed for existing pollution, and Mike Renz has been able to solve them by using common sense and technology, like the time he proved the EPA wrong by doing a simple core-drilling to prove that a supposed landfill on a mobile home park did not actually exist (it had been phoned into the EPA by a former manager who had a grudge against the owner). If you want that level of expertise on your side, then you need Mike Renz to be your Phase I Environmental provider. That’s who we use, and he’s amazingly good.

You can contact Mike Renz at (614) 538-0451.

This a photo of Container Park near Fremont Street in Las Vegas. It’s a retail center made entirely of metal storage containers that have been re-purposed into stores. We are constantly asked about housing applications for steel containers, and the answer is pretty clear.

Good qualities: sturdy and no load-bearing interior walls

Of course, storage containers have some positive attributes. They are very strong and offer a clear span as they have no load-bearing interior walls. You can stack them into unusual designs. They’re easy to transport as they’re nothing to break – including windows. Basically, they’re an unbreakable object.

Bad qualities: incredibly expensive to convert into a housing unit

Now comes the bad news. It costs around $25,000+ to retro-fit a storage container into a residential dwelling. To do so, you have to cut in windows, install plumbing and a working bathroom, install a kitchen, install interior walls, wire the whole thing, install heating and cooling, cut in doors, install drywall and flooring – a total project from scratch. It basically costs as much to turn a storage container into a house as it would to build a mobile home that’s around twice the size.

More bad qualities: virtually no insulation

While some people may complain that mobile homes have little insulation, they look like virtual insulation paradise compared to storage containers. While modern mobile homes have pitched roofs with fair levels of temperature retarding insulation, storage containers are flat roofs that just radiate heat. While this may not be an issue in Alaska, it sure is in Nevada. Imagine the cooling cost when you have a flat sheet of metal just a few inches above your ceiling.

The final straw: no HUD support and no financing

The biggest problem with converting storage containers into dwellings is that they have absolutely no support from the lending community or from HUD. While mobile homes are inspected and approved by HUD and, as a result, have the ability to be placed within city limits, storage containers have questionable provenance and no clear path for legal placement within a city limits. In addition, unlike mobile homes that can be easily financed through 21st Mortgage or other industry lenders, storage containers are 100% cash only with no opportunity for leverage.

Conclusion

While storage containers may seem like a cool way to create housing, the facts are that they are enormously costly and poorly suited to this purpose. It’s important to note that Container Park belongs to Tony Hsieh. He could have used containers for the housing units in his mobile home park (discussed below) but instead chose Airstreams and tiny homes. That says it all.

To advertise here, you must be a member of the MHU Investor’s Club which is a program available to our Mobile Home Park Boot Camp and Mobile Home Park Home Study Course customers. Contact us for more information.

We recently received a tour of Tony Hsieh’s Airstream Village while we were at the Boot Camp in Las Vegas. At the start of the tour, we were shown the building that Tony lived in before he moved into the mobile home park that he owns. Why would a billionaire trade a luxury high-rise condo for a small Airstream trailer in a mobile home park? Actually, there are many reasons.

Harvard was right: relationships are the key to happiness

Harvard recently completed the largest study in history – a half-century in the making. They followed a group of adults from an early age to death, to see what makes people happy. Is it money? Good looks? A college diploma? Actually, none of those. What Harvard found was that it was relationships that made people happy or unhappy. If you have happy relationships with those around you, then you will be happy regardless of material advantage or physical characteristics. Tony Hsieh must have realized this before the Harvard study was released, because he was apparently unhappy in his isolated condo and knew he needed to create an environment that would foster good relationships.

Mobile home parks offer a huge sense of community

What do you get when you mix like-minded individuals with high density – but with just enough privacy that they don’t avoid human contact? The answer is a huge amount of bonding between neighbors. This unique atmosphere is what makes mobile home park living so different from other product types. And this is what drew Tony to exchanging his high-rise for an Airstream trailer. The ability to bond with neighbors and socialize with them. To hear their stories from the day. To make friends. All the things that make life fulfilling.

A chance to create something new and special

Anyone who has visited Airstream Village can feel the excitement over a living experiment that is new and unique. From the “tunnel of lights” entry to the performance stage and common areas, this is 100% a Tony Hsieh original. In addition, there’s a suggestion board of new group activities that people keep dreaming up. There’s even a Facebook Group for residents to share activities. Elvis once said ‘life’s too short to drive a boring car”. Tony just expanded that to a “boring condo”.

Just plain fun

Airstream Village has one common theme: fun. From the giant whimsical sculptures, to the pool table, ping-pong table, outdoor kitchen and massive outdoor seating, this is a property that understands the concept of recreation. Residents work hard and play hard. And this element of fun was surely not part of the high-rise condo lifestyle.

Conclusion

Some people may look at Tony Hseih’s Airstream trailer and think he’s crazy to have swapped a high-rise condo for a 8’ x 30’ RV. But they’ve never seen Airstream Village, or thought about the benefits of a community lifestyle with like-minded individuals.