What Is A Land-Home Package?
By Amanda Cruise
As you know, there are only a few particular lanes Jonathan and I stay in with Voyage Investing. We seek mobile home communities and non-residential commercial real estate with solid value-add. I personally think 2024 is a great time to buy multifamily properties with significant distress in that market, but we don’t seek out those deals on the active side because we don’t have expertise in that asset class.
There is an asset class you might not have heard of yet where we will be doing more work coming up. I’ll call it “adjacent” to mobile home communities. You might have seen me posting a bit about land for these projects. Let’s dive into something called a land-home deal and why we like them.
What is a land-home deal?
You can think of it as building a single-family home, it’s just that the home is technically a manufactured home. For simplicity’s sake, that just means the home was built in a factory and brought on-site to be affixed to the land instead of built on-site. The home and land are sold together, just like with any other single-family home. These houses sell for a bit of a discount compared to a stick-built home, so can be a great affordable option. And they can be very nice!
Affordable Housing
If you’ve been following along our journey any time in the past several years, you know we like mobile home parks. One of the many reasons is the extremely high demand of affordable housing. Rent is skyrocketing. Home prices have gone up and I believe once interest rates come back down, prices will climb even higher.
These land-homes are exactly in the affordable housing lane. For a project I’m working on now, we’ll bring a brand new beautiful 2024 double-wide onto a lot that already has a well and septic. This brand new home will sell for somewhere around $275k whereas other brand new homes in the same area are starting at $400k. Just like with mobile home communities, there is demand for this product!
Our Personal Advantage
These land-home deals are rightttt in our lane. Here are a few reasons why:
1. We are already manufactured home dealers, which means we have a unique advantage – we get major discounts on brand-new manufactured homes from manufacturers. We don’t have to pay retail.
2. We know exactly how to bring in a manufactured home to land and get it set up. We know the costs, the setup order, the permitting process, etc. because we’ve done it several times in our communities already! The only difference here is the land will hold 1 home instead of many and be sold once built off instead of held.
3. We know the infrastructure side (sewer, water, electrical) very well from our experience with manufactured home communities.
4. We happen to live in an area where new homes are going for $400k+. When we get the land for the right price, we can deliver a brand new 1500 sqft product for less than $300k!
How Does It Work?
First, we find land for a great price. That’s critical and somewhat challenging to find because land outside of Raleigh goes for a premium. Next, we ensure the land is suitable for a new manufactured home. This means zoning is approved for a manufactured home and the land already has water and sewer available or is able to have well and septic on site. Once the land is approved, we buy it and order a brand new manufactured home. We get to work having the land prepped for the new home arrival including having new concrete footers poured. Once the new home is ready, it’s delivered and affixed to the land. At that point, several contractors including HVAC, electrical, and plumbing come and get the home hooked up. Final touches like decks, new brick skirting, and any touchups on the inside resulting from the move are handled. A bit of landscaping is done, nice pictures are taken, and the home is listed for sale.
As always, I love talking about this stuff. Please reach out if you have any questions. Amanda@VoyageInvesting.com and if you’re looking for ways to put your money to work passively, make sure you join our Investor Circle.