Passive Mobile Home Park Investing

Top Risks: Private vs. Public Utilities in Mobile Home Park Investing

Oct 15, 2024
A deep dive into utility infrastructure risks for mobile home park investing. Short segments compare private systems like wells, septic, lagoons and treatment plants with public water and sewer. Listeners hear about lift station failures, aging Orangeburg pipes, cold-weather water issues, and practical due diligence checklist items to spot costly red flags.
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ANECDOTE

Septic Mistakes Can Cost Huge Fines

  • Andrew bought a park with 67 individual concrete septic tanks and learned to inspect them during due diligence.
  • A peer later faced EPA fines of $10,000/day from septic contamination after skipping proper checks.
INSIGHT

Public Utilities Lower Investment Risk

  • Public utilities (city water/sewer) are strongly preferred because the municipality handles treatment, testing, and maintenance.
  • Private systems shift responsibility and cost to the owner, increasing operational risk and oversight needs.
ADVICE

Verify Well Systems Thoroughly

  • When a park uses a private well, require regular chlorine reads and periodic contamination testing during due diligence.
  • Confirm alarm systems, licensed operators, permits, and past test results before closing.
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