Mobile Home Parks

Mobile home park investing, sometimes referred to as manufactured housing community investing, involves owning the land and infrastructure of a community while the majority of individual homes are typically owned by the residents themselves rather than the property owner, a structure often called the land lease model. Under this model, the park owner leases individual home sites to residents who own their manufactured homes and pay a monthly site rent that covers land use and access to shared infrastructure such as roads, utilities, and common areas. Investors in Fort Worth, Texas considering this asset class generally find that the land lease structure reduces landlord responsibility for individual home maintenance compared to owning traditional rental housing, since the homes themselves belong to the residents.

For 1031 exchange purposes, the land and permanent infrastructure of a mobile home park qualify as real property, similar to any other investment real estate. Where the park owner also owns a portion of the homes within the community and rents them out directly, sometimes called park owned homes, those individual manufactured homes may be treated as personal property depending on how they are titled and whether they are permanently affixed to the land, which can complicate the exchange analysis for a park that includes a significant number of owner held units. A community operating primarily under the land lease model, where residents own their own homes, generally presents a more straightforward like kind exchange involving the land and infrastructure alone.

Demand for manufactured housing communities has been supported nationally by a persistent shortage of affordable housing options, and investors in the Dallas Fort Worth metroplex evaluating this asset class typically review the park's site occupancy rate, the condition of infrastructure such as water and sewer systems, and local zoning restrictions, since manufactured housing communities can face development constraints that limit new supply and support existing park values over time.