Takings’ case may be human-rights issue High court asked to mull rent-control case
SACRAMENTO — An attorney who defends low-income people against local government takings likes to say that “property rights are human rights.” It’s not much use to have the right to speak out, he argues, if you don’t have the right to be secure in your property.
We chatted years ago when a county was using eminent domain — government’s right to take property, after paying fair compensation — to acquire modest lake-area homes on behalf of a developer. Owners called the neighborhood a “poor man’s Shangri La,” but officials said it was a public use to turn the area into an upscale development.
My attorney friend viewed it as an affront to the rights of the mostly retired owners. Most Americans seemed to agree. After the U.S. Supreme Court ruled in the 2005 Kelo v. New London case that localities could use eminent domain for “economic development,” a public backlash ensued given the seeming unfairness of these “take from the poor, give to the rich” policies.
Eight years later, another landmark property-rights case may be headed to the nation’s highest court. It involves a similar question that was at the heart of Kelo, but applies it to different circumstances: When can government take the value of private property through regulation and transfer it to a different set of owners?
The court is deciding whether to hear this new case, which centers on the city of San Rafael’s rent-control ordinance. Here it harms an out-of-state developer and benefits local mobile-home residents, but many of the same principles are at stake even if the economic conditions of the beneficiaries and losers are swapped.
In California, mobile-home residents typically own their homes but rent the land from the park owners. When owners sell their home, the park management must lease the underlying property to the new purchaser. A park owner is limited in the ability to evict a mobile-home owner, based on state law.
Read the full article online and see what’s happening in Marin County.
Mobile Home Parks: Gold Mines or Money Pits?
By WEALTH Magazine Staff
If you ask multi-niche investor Frank Rolfe what he thinks of investing in mobile home parks, his answer is simple:
“They’re a gold mine,” he says. “We are willing to bet money that they are the best real estate niche in existence in America right now.”
Rolfe says he has personally owned and operated more than $100 million in parks over the last decade.
Rolfe of MobileHomeParkStore.com finds mobile home parks to be a phenomenal investment—if you get educated and do your due-diligence research.
What Makes Mobile Homes Moneymakers
Why are parks so great for investors? Rolfe says the main reason is that customers can’t move their homes. If an apartment renter wants to move, he can just pick another apartment. If a homeowner decides to move, he can sell his home and buy another. But if a mobile home owner wants to move, he either has to sell the mobile home or move it—and moving it is usually too cost-prohibitive. Either way, the park owner keeps collecting rent on the home site.
The second factor that makes mobile home parks a great investment is that not many, if any, new mobile home parks are being built. Yet the demand for affordable housing is increasing, and mobile homes remain popular because they offer the perk of a single-family dwelling rather than apartment living with neighbors over, under and adjacent to you. The third reason why these investments can be so attractive, Rolfe says, is that many of them are owned by people who are nearing retirement age or no longer want to keep the park in the family.
“There are about 50,000 parks in the U.S. and forty thousand of them are basically owned by moms and pops, many of whom don’t know what they are doing,” Rolfe says. “If you look at their financial statements—if they even have financial statements—they are often messed up. You can find many parks where the expenses are overinflated and the rent has not been raised in decades and is way behind the local market.
When you find a park where you can walk in and either easily cut costs or raise the rent, then you are looking at a great investment.”
Rolfe says the pièce de résistance for mobile home parks is that the land in many of the “mom and pop” parks is already paid off, and the sellers will hold the loan with only 10 or 20 percent down.
“When you already have the financing done by the seller, it allows you to avoid the whole banking nightmare,” Rolfe says. “Plus, sellers don’t require recourse, which means you have very little risk. If you hate it or if disaster strikes, you can just give the park back and walk away.
Read the full article online