Why Mobile Home Parks May Beat Apartments for Real Estate Investors Seeking Cash Flow

Mitchell England (00:00)
Yeah, I mean, a couple of new projects I will get into, but we just bought 150 units, 75 in Illinois, 75 in Indiana, both off market properties, just stuff we can go value add and make better. So that’s really exciting for our team to take those projects down. We’re currently looking for more deals. We’re always looking for deals. You know, I think for the audience, if you’re inspired by scaling in cashflow real estate and getting time back and getting control back, one of the things I say, and I’m pretty bold about it is like,

you need to get in the right room. And you’ve got to be getting around people that think the way you want to think, have results that you want to have.

Dylan Silver (02:08)
Hey folks, welcome back to the show. Today we’re joined by Mitchell England, a full-time real estate investor, author, and founder of Cadia Capital Group. He operates across multifamily and mobile home park investments with a portfolio exceeding hundreds of units and is the author of Zero to 100 Units, a book focused on building financial freedom and reclaiming time through cash flowing real estate. Mitchell, thanks for joining us today.

Mitchell England (02:33)
Thanks so much for having me. I’m super excited to jump on.

Dylan Silver (02:35)
Now, your message is heavily centered around getting your time back through cash flowing real estate. When did you realize that wealth without freedom wasn’t enough?

Mitchell England (02:47)
Yeah, you know, I think this happened for me in my late 20s and I think it happens for a lot of people late 20s, 30s to 40s, somewhere in there where people have the awakening where they’re like, look, I got what I wanted. Maybe you got the title, you got the job, you got the thing you chased, the thing you went to college for, but you don’t necessarily have the life you want. You know, I was working in a corporate job and I had great benefits. I had great pay. I had all the things like looking up from the outside. I was super lucky and I was fortunate and I didn’t have a lot of gratitude, but

I wasn’t happy because I didn’t have my time. And more than time, think the word that we’ve been gravitating toward lately is control. Because like I think as adults, whether you’re an adult woman or man, you want control of your life, your time, your vacation, whether you want to go take some time off for health and for mental wellness or whatever that is, having that control is a big piece. So I think it’s my late 20s when I realized that and then I took the job.

Dylan Silver (03:42)
Now, a lot of people will get started through either attending an investing ⁓ group of some kind, or they’ll get started really by happens dancer. Maybe someone in their inner sphere introduced them into real estate investing. What was the on-ramp like for you?

Mitchell England (04:45)
Well, I mean, I’m a slow learner. So school hard knocks my twenties. I read a lot of books and I took a lot of action, but I took a lot of wrong action. I mean, looking back, it was part of my journey. So, you know, it built me to who I am today, but I bought land. bought ⁓ houses, single family houses, duplex. really ⁓ looking back, I wasted a lot of time because I didn’t get around the right people fast enough. In my early thirties is when I got around the right people. I joined my first mastermind. Then I joined, I think two more after that.

And that for me was like the pivotal moment because I finally got around people who are living the life I want to live. Before that, I was taking advice from people who owned a couple of duplexes and, you know, and hated it basically. so I mean, it was a school of hard knocks for me. think the scale, where scale happened for me was I got around other people who actually had the result already that I was, that I was pursuing.

Dylan Silver (05:23)
Yeah.

Now, when we are looking at the multifamily value add space versus mobile home parks, two totally different niches, but I think that there’s a lot of interest right now from multifamily investors in mobile home parks for a lot of reasons. What was that process like for you getting involved in the mobile home park space?

Mitchell England (05:52)
Yeah, well, I mean, to be honest today, I’m basically 100 % toward mobile home parks. We did some early apartment complexes, some different projects that were value add. I mean, you know, the attractiveness of mobile homes, I could go on for an hour. We don’t have that much time, but like you think about it, the average tenant is going to be in a mobile home park for 20 years. Most of the time they own the home. They have pride in ownership. You are not responsible for HVACs, for roofs, for sticks and bricks like you are in an apartment complex.

Your expense ratio ranges between 30 and 40%. Management is very, very simple. know, low turnover, low expenses. your, your NOI is a lot closer to true NOI versus apartment complex. You’re sweeping a lot of that over to reserves for capex projects. Like there’s so many fundamentals when you look at a mobile home park. Now, with that being said, a lot of people are pursuing mobile home parks. So there is a lot of competition in this space, which is good and bad, right? You find a good deal though.

you’re going to be able to capitalize in a big way. there’s so many aspects to mobile home park that I like, ⁓ you know, to, sort of top that off, they play really nicely with cost segregation studies and bonus depreciation. can take a lot of good big tax losses. And so it’s been a space that once I found, was like, I don’t understand. cannot figure out how to find an asset class that beats it.

Dylan Silver (07:06)
Yeah, I mean, there’s a lot of reasons for that. You mentioned so many of them. They’re also not making any new or hardly ever making any new mobile home parks. so, know, folks oftentimes will, from what I understand, have been owning a mobile home park for maybe decades and haven’t made hardly any improvements. And so there is even in something that seems simplistic ⁓ from the outside looking in, there’s opportunity for value out there.

Mitchell England (07:13)
That’s right.

For sure, you you have a lot of owners. The other thing too is like today we have tech. have all these kinds of, you know, have computers and software and all this kind of tech where we can actually manage from afar. In the old days, even 20 years ago, people had to manage sort of like from the park. So a lot of owners live at the park. Okay. They know a lot of tenants and to add a disservice, they think it’s a service, add a disservice to the tenants, they keep the rents low. Well, what happens if you keep the rents low, but prices go up, costs go up across everything else?

basically you just can’t maintain it. So these parks, we walk in and we go, look, you have terrible roads, have overflowing sewer systems, have, you know, the kids are waiting on the rain versus underneath a bus, a bus shelter, like there’s no security. Like we go in and we say, look, how can we add a ton of value while bringing rents toward the market? And the tenants, what’s amazing is the tenants love it. They go, look, yeah, will I pay a little bit more for a safe community where I have amenities, where my car is not going to, you know, get swallowed up by a sinkhole?

Yeah, the answer is yes for 99 % of tenants. So there’s really this opportunity to go out there and say like, look, okay, thank you, Ma, Pa, for what you’ve done. However, we’re going to run it differently. We’re going to improve the park, the asset. We’re going to make it safe for tenants. And then we’re going to rents toward market, which is the financially responsible thing to do.

Dylan Silver (08:45)
Are mobile home parks a way to address affordable housing or is it such a separate segment that folks who might be looking at apartments or their own single-family home might not be looking at a mobile home?

Mitchell England (09:34)
You know, I think that we compete with other affordable housing options for sure. I mean, you think about like an affordable apartment in any given city might be like, say it’s $800, The next mobile home park is going to be lot right around four to 500. It’s actually cheaper. You’re actually getting your own sort of little area of land, your own little yard. It’s a community feel versus just like stacked, right? There’s big hallways or whatever. So it’s a different way of living. ⁓ We have mobile home parks that like the…

People really care about their home, about their yard, about their landscaping, about flowers around. It’s a way different feel than an apartment complex, and they pay less than the apartment complex down the road. So I think we compete directly with affordable housing options.

Dylan Silver (10:18)
For folks who are trying to themselves get into the on-ramp of real estate investing, I’ve often thought about, well, if I’m looking at home ownership and I may feel closed out of buying a single-family home and rents are so high, where does owning a ⁓ mobile home make sense? I’m curious to get your perspective on that from the standpoint of if someone wants to get into the on-ramp of ownership, what makes sense to them?

Mitchell England (10:44)
The on ramp to ownership to actually owning a mobile home in a mobile home park. Is that what you’re saying?

Dylan Silver (10:48)
Yeah, and who’s the ICP, if you will, of a mobile home owner?

Mitchell England (10:54)
So, know, the average person, you know, who, who moves into, you know, when we buy, let me rephrase this. When we buy mobile home parks, a lot of people already own their home, okay? And they’ve been there for multiple years. And I said this in the beginning, sometimes 20 years, a ton of time. The other thing that we see is we’ll buy parks and we inherit the home. And then we’ll go actually sell the homes off to, to tenants. That’s…

a newer model, I would say, that’s adopted by a lot of more, you know, sort of like, uh, educated mobile home park investors where they’re selling off the, they call it POH, Parkone Home, to the tenant. The, you know, these folks are folks who want to have a little plot of land. It’s something where they can have a little bit of privacy. They can have a community that’s safe, that’s respectable. Um, and you know, there, our goal is mobile home park owners and a lot of owners that

I network with have the same goal. want to make them homeowners. Not only do they get a little bit of equity there, but they have private ownership. It’s easier for us to maintain. It’s actually easier for them to maintain. They don’t need to call somebody. so, I mean, I think the average person is looking for a different option to other than the apartment complex. just doesn’t, apartments don’t always meet the need of folks and people want to have that community feel versus just be stacked.

Dylan Silver (12:12)
No, I think you’re exactly right. You mentioned community several times. One of the things that I do feel like is a drawback, which is unusual, right, is even in some of these class A, know, multifamily high end apartments where they might have a gym and a pool and an office center, there does seem to be an incredible amount of anonymity where you don’t even know your neighbors. And I think that that sounds shocking, but it’s probably fairly common.

Mitchell England (12:35)
Edo.

I think it is common and I experienced that we actually moved back for a family emergency a couple of years ago to Wisconsin and we got an apartment, nice apartment. And it was very much, you know, they tried to make that community feel. However, like it was very quiet, which was good in a lot of ways, but it was like, there was really not much going on. And with kids I’m going, hey, like it’d be nice to like have, you know, some other interaction or like community, you know, sort of events or whatever. So, I mean, they tried, but.

Yeah, like you just don’t have that same feel as if you’re like outside and you’re in more of like a neighborhood setting.

Dylan Silver (13:10)
I think that there may be something, you mentioned pride and ownership several times. I like that term because if you have the option or the necessity to maintain and upkeep something, you’re going to be more prideful of it and you’re going to want to see that everyone else in your neighborhood is doing well, right? Because you don’t want to see your neighbor doing poorly and that could potentially reflect badly on the neighborhood as a whole. And when…

people don’t even have a front or a backyard like you might in an apartment complex, you’re not gonna have that same sentiment.

Mitchell England (14:25)
Yeah, I agree. mean, you know, there’s a lot of mobile home park or mobile home owners who you drive through the neighborhood and you go like, these are nice little houses. These are not like, like people always like stigmatized, right? Where they’re like, oh, a mobile home park is going to be, it’s going to look this way. It’s not always true. mean, we have amazing tenants that maintain homes. Of course, every park is a little bit different, but, the other thing too is they’re sellable. You know, when people want to move or people want to retire to a different place, they’ll go sell their home.

They’ll go sell their home, depending on the area, could be 30 to $70,000, know, depending on how, of course, the condition everything else, but there’s some equity there that they’re able to maintain over time, which I think is important for folks who might not be able to get in the home ownership, you know, ⁓ like a stick built home, for example.

Dylan Silver (15:12)
to pivot and ask you about a space that I see emerging, which I don’t know if it’ll compete with mobile, but from an outside perspective looking in, it feels that way. I’ve seen a lot of these tiny home communities and modular home communities. I’m in Texas, so a lot of land out here, right? Do you see that modular homes, both because of the perception and then the way that they’re making more of these communities, could be another answer to affordable housing?

Mitchell England (15:23)
Mm-hmm.

You know, it could be, think the coolest thing about a tiny home is looking at them online, probably not living in them. I think a lot of people live in tiny homes and they go, whoops, I think I need more than three or 400 square feet. to keep it ⁓ affordable with a tiny home, like a tiny home stick built home, they’re still pretty expensive at like literally 400 square feet. So that model, I think might meet the needs of certain people who are like, look, I’ve got me and my spouse or my person or whatever.

and no children maybe. Where I think we’re going to see probably some innovation or some progress is the innovation of the process to build. Innovation in the process to build. And we’re getting smarter with AI. We’re getting smarter. So I don’t think we’re going to have these factories with, you know…

people everywhere. It’s going to go to full robotics. I think people are trying and working on different materials. Yeah, I do think we’ll see progress there. Now as a mobile home park owner, that’s exciting to me because I have a bunch of vacant pads. So if I can get a house at a cheaper rate, that’s actually going to help me as well. And it’ll inspire or encourage me to go fill those pads and create more and more housing.

Dylan Silver (16:47)
We are coming up on time here at Mitchell. Any new projects you’re working on and then also anything you’d like to say directly to our audience.

Mitchell England (16:54)
Yeah, I mean, a couple of new projects I will get into, but we just bought 150 units, 75 in Illinois, 75 in Indiana, both off market properties, just stuff we can go value add and make better. So that’s really exciting for our team to take those projects down. We’re currently looking for more deals. We’re always looking for deals. You know, I think for the audience, if you’re inspired by scaling in cashflow real estate and getting time back and getting control back, one of the things I say, and I’m pretty bold about it is like,

you need to get in the right room. And you’ve got to be getting around people that think the way you want to think, have results that you want to have.

I think it’s such an important concept. We can go off on strategy and tactics and education and what book to read and what podcast lit all those things. But if you’re not around the right people, for me at least, that was what changed things for me. And so whether you pay for it by joining a mastermind like yourselves or mine, or you build it.

whatever it is, how do you go about that? Make sure that you get in the right room and you get those contacts and that network that’s gonna lift you up.

Dylan Silver (17:52)
Mitchell, thank you so much for joining us today. Thanks for your time.

Mitchell England (17:55)
Course.