In mobile home communities, the term “infill” refers to the process of bringing new homes into vacant lots within an existing park. Whether a community has a few empty spaces or a large number of unused lots, infill can play a significant role in maximizing occupancy, increasing revenue, and revitalizing the property. Here’s a closer look at what the infill process involves and why it’s essential for mobile home park owners and operators.
What Is Infill in Mobile Home Communities?
Infill in mobile home parks is the practice of filling vacant lots with new or used manufactured homes. Over time, parks may have empty spaces due to tenants selling their homes and moving away, homes being removed for disrepair, or the park having undeveloped lots. Instead of allowing these lots to sit vacant, the goal of infill is to add value by bringing in homes that can be sold or rented, thus increasing occupancy and cash flow.
Why Is Infill Important?
Empty lots in a mobile home park represent lost potential. Here’s why infill matters:
- Increased Cash Flow: Vacant lots don’t generate income, but every new home brought into the park provides either lot rent or home rent, both of which contribute directly to the community’s bottom line.
- Higher Property Value: Parks with higher occupancy levels tend to be more attractive to potential buyers and investors. Filling empty spaces not only improves the look of the park but also enhances its overall value.
- Community Improvement: Infill can significantly improve the aesthetics and reputation of a mobile home community. A park with fewer vacant lots feels more vibrant, well-maintained, and appealing to both residents and future tenants.
- Resident Retention: A thriving, fully occupied park creates a more engaging and enjoyable living environment. Existing residents are more likely to stay in a well-managed and lively community where new neighbors are moving in, and vacant lots aren’t left neglected.
The Infill Process: Step by Step
Infill can be a complex process, requiring coordination between park operators, home manufacturers, and local regulations. Here’s how it typically works:
1. Lot Preparation
Before bringing in new homes, each vacant lot needs to be prepped. This includes ensuring utility hookups like water, electricity, and sewer are in working order. It might also involve grading the land, adding gravel or concrete pads, and confirming that the lot is the right size for modern manufactured homes.
2. Home Selection
Park owners can choose to bring in new or used homes. New homes offer a more modern and attractive option, while used homes are often more affordable and may still provide solid returns. In some cases, park owners may partner with manufacturers to bring in homes at a lower cost or offer financing options to make homeownership more accessible to residents.
3. Marketing and Sales
Once the home is placed, it’s time to market the lot to potential buyers or renters. Some parks offer the homes for sale, while others rent them out to tenants. Strong marketing strategies, such as online listings, social media, and local advertising, are crucial for filling the new spaces quickly.
4. Tenant Onboarding
As new tenants move in, it’s important to have a smooth onboarding process in place. This includes ensuring all contracts and lease agreements are handled efficiently, walking tenants through the community rules, and addressing any questions they have about their new home or the community.
5. Community Engagement
After the infill process, ongoing community engagement helps create a positive environment. Hosting events, welcoming new residents, and keeping the community well-maintained encourages long-term tenant retention and satisfaction.
Challenges with Mobile Home Infill
While infill brings great benefits, it can also come with challenges:
- Permitting and Zoning: Local regulations may require permits or impose zoning restrictions that can slow the process.
- Financing: Bringing in new homes requires an upfront investment, whether buying homes outright or financing through a third party.
- Utility Upgrades: Older parks may need significant upgrades to their utility infrastructure before new homes can be added, which can increase costs.
- Tenant Financing: For residents looking to purchase a home, securing financing can sometimes be difficult, especially if they have limited credit histories.
Why Open Door Capital Invests in Infill at Our Mobile Home Communities
At Open Door Capital, we see infill as an opportunity to create value for both our investors and the residents of our communities. By adding new homes to underutilized spaces, we’re able to provide affordable housing options, improve the overall community atmosphere, and increase returns for our investors.
Check out some images of the infill process on our What We Do page.