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Private Property or a Land-Lease Community?
Fri 05/28/04 10:11:35 pm
Chrissy Jackson Archives

As an owner of a manufactured home, it's inevitable that sooner or later, you will consider the answer to that question. What should you consider if you think you want to live in a land-lease community and pay rent every month? Why should you know if you want to buy private property? With zoning easing up in most areas of the United States, and attractive finance rates for land/home packages, you may be at a loss as to the best choice for you - both in the immediate future as well as long term.

This article will help you weigh the benefits of both, then make the decision based on the areas of greatest importance to you.

  • Guidelines - Communities have Guidelines (formerly called rules and regulations) which set parameters for acceptable behavior in close quarters. Private property has none. Your neighbor in private property can blast their stereo in the afternoon and early evening, let their grass grow a foot tall, and your options for help are about nil to nothing. In a community, the manager is on hand to take control and enforce the Guidelines.

  • Amenities - Communities generally offer some type of amenities: pool, playground, clubhouse, street lights, paved driveways, tennis courts, shuffleboard, planned activities, and/or professional management. Private property usually comes with none of the above unless the owner installs them at his expense, or unless the private property is located in a subdivision.

  • Real Estate Taxes - In a land-lease community, the resident's share of the real estate taxes are included in the monthly rental payments. On private property, they must be paid separately.

  • Personal Property Taxes - Generally speaking, personal property taxes are lower in a manufactured home community than they are on private property. However, because schools can impact tax rates significantly, know for sure where the specific community you are considering stands on this issue before assuming a lower rate as a benefit.

  • Resident Screening - In a community, there generally is a resident screening process. Private property requires only that the applicant qualify for a bank loan, or pay cash. As the owner of private property, you never know who might move in beside you. In a community, you can rest assured that your neighbors had to meet the same financial criteria, employment verification, landlord reference checks, and sometimes even criminal checks, that you did.

  • Utilities - The provision and maintenance of the infrastructure which provides utility service to residents is the responsibility of the community owner. This may or may not include a well, septic tank system, lift station, or waste water treatment plant. On private property, if the sump pump in the well goes out, it is the home owner who has to fork out the money to have it repaired. If the septic tank fills up and won't drain properly, once again, the homeowner has to dig deep - and maybe miss work on top of that to meet with the contractor doing the repair.

  • Monthly Cost - Generally speaking, the monthly cost of renting a homesite in a land-lease community is less than the cost of owning land. Long term leases with escalator clauses provide a sense of security to a resident - not because they know how much their rent increase will be each year, but because they know how it will be figured.

  • Location - When people think of private property, they usually think of their own little world - far away from everyone else - miles (or at least several hundred feet) from their nearest neighbor - and, guess what? That also makes them miles from all the other conveniences of life. Like shopping, schools, churches, banks, groceries, doctors, hospitals, etc. Real estate values are determined by location, location, location. So are your values. Learn how your choice of community is situated in terms of the surrounding area, and where a homeowner would have to go if they were buying private property for siting their manufactured home. Then decide if the benefits of living closer to the "comforts of civilized life" take a high place in your priorities!

  • Easier to Purchase - Buying a manufactured home (new or pre-loved) is easier to qualify for - easier to finance - than buying a traditional site-built home. Approval times are almost immediate with the chattel loans used for manufactured homes as compared to the volumes of paperwork, surveys, etc., required for purchases and/or financing which involves land.

  • Security - Within a community there may be a Neighborhood Watch Group, or a Crime Watch Program, or a Multi-Housing Crime Free Program for the added security of the residents. If none of these is present, there is still the sense of "neighborhood" which creates closer relationships than generally found on private property placement. People feel closer to each other in a community and look out for each other.

  • Social Recreation - The clubhouse, common area, playground, or just the mailbox area all provide excellent opportunities for residents within a community to socialize. If your choice of community has a pool, tennis courts, basketball courts, shuffleboard, hiking trails, or other amenities, there are even more opportunities for recreations. In private property placement, unless it is a Planned Unit Development (PUD) there is usually not any type of recreation facilities, nor planned social recreation of any type. Most communities with a clubhouse have some sort of planned activity program - either led by volunteer residents or by management.

  • Relocation - If your plans at some point in the future call for relocating, consider your options. Often an unavoidable circumstance, such as job transfer or promotion, family health matters, or financial issues force you to relocate. When that becomes necessary, you can usually vacate a rented homesite with a 30 day notice, and take your home with you. You then have no further responsibilities to the community owner except for perhaps a final utility billing. In a private property situation, the land must be sold, or payments must continue even if you take your home with you.

  • Resell - Or, if you must relocate and want to resell your home rather than taking it with you, again, it is easier if your home is located within a land-lease community. The financing for the new buyer is quicker to approve, quicker to arrange, the selling price is less since there is no land, and the value of the home should hold in comparison to the value of the community. On private property, the selling of a land/home package is no different than the selling of a conventional site-built home. It can take quite a bit of time to do all the necessary paperwork and legal research required to sell land.

  • Maintenance - Life in a community is commonly thought of as a "maintenance-free" lifestyle. And, while the homeowner is responsible for the little bit of maintenance and upkeep to his homesite and the home itself, it is extremely minimal when compared to the maintenance requirements of a homeowner who also owns his land. If the private property is not in a PUD or subdivision with municipal water and sewer, the homeowner will be responsible for the operation of the septic tank and well. On private property, homeowners are also generally responsible for the power pole providing electric service to their home. And, since most private property lots are considerably larger than the homesites found in communities, there is more grass to mow, more landscaping to plan, plant and prune, and more trees to trim.

  • Investment (Initial and Monthly) - Since the purchase price of a manufactured home located in a land-lease community is significantly less than that of a home with land, it stands to reason that both the initial investment (formerly called down payment) and the monthly investment are also considerably less.

  • Snow Removal - Most community owners who operate in areas of the country where there is snow are prepared for that event, and have either the equipment and manpower necessary to keep the roads inside the community clear, or have a contract signed with someone who can. If you as a homeowner buy your own land, you are then subject to the master plowing schedule of the county or municipality where you locate. And, since we already established that the urge to buy private property is fueled by the urge to return to nature and leave civilization far behind, that often means secondary roads, which are not plowed with any great regularity in many areas. Nor are they first on the list to plow even in areas where they are plowed. That may mean missed days of work if the homeowner can't get out onto the main roads.

  • Professional Management - Obviously only available in a community, this single area is responsible for the appreciating home values, the positive aesthetic qualities, the constant curb appeal, consistent enforcement of guidelines, and all the myriad of other things that make the lifestyle of a community what it is. Check into the turnover rate of residents within your choice of community; the general values of homes on the resale market; the longetivity of residents, and the things that make a difference to you between a community and private property.
Do you have other concerns about the differences between land-lease communities and private property which have been overlooked? Send me an Email ([email protected]) and let me know.

Chrissy Jackson, ACM, PHC, has been involved in Community Management for over 16 years. She managed communities from 200 sites in size up to over 800 sites. Chrissy also provides property management and sales training to state association conventions and private companies. She is also recognized as a nationally published author with several publications currently on the market. More about Chrissy at

MH BOOK STORE - Community Manager's Collection
 by Chrissy Jackson   
Every manufactured home community needs to have the right forms on hand. Even if your operation is automated, information must be tracked, data analyzed and reports completed. This new collection on CD from Chrissy Jackson, ACM, PHC, features more than 200 of the most common community forms that complie vital information to help you do just that!  You can personalize them for your community, change headings, or use a basic format in more than one way.  Price:$75.00    Shipping & Handling: Included        
by George Allen, David Alley & Edward Hicks       
This is the first complete reference book in twenty years to cover all aspects of development, operation and marketing of manufactured home communities.  This book addresses the land development and initial operation of manufactured home rental and subdivision communities in the U.S. and Canadian markets.Designed for the professional as well as the engineering student and would-be developer, this easy-to-follow guide takes you from an introduction to the manufactured housing industry through the steps of successful sales and leasing  Price:$83.00    Shipping & Handling: Included      
by Chrissy Jackson 
Once you have the proper Guidelines (we used to call them restrictions) in place, how do you enforce them? This handbook offers over 100 tips and techniques on proven methods of bringing residents into compliance with your stated policies and Guidelines.  Learn how to be firm, fair, consistent, and to win the respect of your residents while eliminating Guideline violations from your community. This handbook is the answer!  Price:$25.00    Shipping & Handling: Included          
by Chrissy Jackson    
If you are writing Guidelines (rules) for a community, are you in compliance with federal laws? Now, for the first time, whether you are starting from scratch, or updating an existing set, this handbook will make it easy.  Price:$25.00    Shipping & Handling: Included      
by George Allen      
This is the first comprehensive reference text to present all aspects of prospecting for,  purchasing,  professionally managing and marketing a manufactured home landlease community as a real estate investment.  The author begins the book with a clear and complete description of the manufactured housing industry as a whole and its many manufacturing, distribution and real estate-based segments. Then he turns the reader’s attention, with the able assistance of a dozen contributor experts, to what it means to be a real estate investor in general and a manufactured home community owner and operator in particular.  This book draws upon the expertise of many of the industry’s most knowledgeable individuals to provide a comprehensive guide to manufactured home community investing.   Price:$83.00    Shipping & Handling: Included
by Chrissy Jackson   
The true secret to effective resident relations is here! This handbook gets right down to the nitty-gritty of creating a partnership with your residents for the betterment of the community. You now have a chance to understand from both sides of the desk how decisions you make and things you do on a regular basis are perceived by your residents. If you have ever wondered why a resident does what they do or doesn’t do what you want them to do, this handbook will enlighten you! Some of the topics covered include “How About a Little Respect?”; “Money makes the World go ‘Round”; “About those Guidelines”; “On Becoming Neighbors”; and lots more. The true need for a personal touch in management comes alive through the characters in this handbook. Price:$15.00    Shipping & Handling: Included . 
by Stephen G. Pappas     
194-pages, covers a wide range of management tasks. More than 60 lists and forms Everything from business procedures to risk management to maintenance and handling people. An industry best seller and a classic. In a Generous and Easy to copy 8-1/2 x 11-inch format The only book on the subject published by the Institute of Real Estate Management. Price:$35.00    Shipping & Handling:$4.00      
by George Allen       
This book is a complete rewrite of George Allen’s historic property management text, Mobilehome Park Management, first released in 1988! All George Allen’s books continue to be the most authoritative reference books on the manufactured housing industry.  There is no better reference or guidebook to professional real estate investment management techniques applied to the manufactured home community asset type. Price:$63.00    Shipping & Handling: Included      
by Chrissy Jackson     
When properly promoted, every community should have a waiting list of qualified prospects and should be receiving resident referrals on a regular basis. How do you do this? Who should partner with you in an effective marketing program? What areas are you not even aware of that send a marketing message to your prospects? How can you create programs to improve the perception your residents have of the community? How can you show prospects (in one page) that your community is heads above the competition? All of this plus lots of marketing and promotional ideas are packed into this handbook.  Price:$25.00    Shipping & Handling: Included        
 by Stephen G. Pappas   
More than 25 years of experience have gone into the development of these forms specifically designed for the effective management of manufactured home communities. Easy for photocopying. Dozens of forms cover every need!
Rent Rolls, Resident Rosters, Utility Logs, Delinquency Reports, Purchasing and Finance Checklists.  Price:$49.95    Shipping & Handling:$4.00          
 by Chrissy Jackson
If you are in the process of making a decision about whether to sub-meter or not, this handbook helps you understand the practical values of installing water meters. It also gives you actual language and sample letters to use as you share your decision with your residents. Bring them along to the positive side of sub-metering; show them the common sense of not paying for their neighbor’s wasted water. This handbook takes you from the initial decision to sub-meter through the selection of a vendor. It looks at the pros and cons of using a contractor for installation vs. using your own people. Forms to monitor installation, communicate regularly with residents, and to compute your residents’ actual cost of bathing, washing clothes, etc., are all part of this handbook.  Price:$25.00    Shipping & Handling: Included

Managing Mobile Home Parks
by Stephen G. Pappas

194-pages, covers a wide range of management tasks. More than 60 lists and forms Everything from business procedures to risk management to maintenance and handling people. An industry best seller and a classic.

Price:$35.00    Shipping & Handling: $4.00
In a Generous and Easy to copy 8-1/2 x 11-inch format

The only book on the subject published by the Institute of Real Estate Management.

Cutting edge technology and top- notch technical support for community managers. Includes features such as automatic process billing, an automatic late charge system, a bird's eye view map with built in unit and tenant information, many useful reports, and an interface with QuickBooks accounting software.   DOWNLOAD FREE TRIAL

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