Home Buying in Santa Cruz>Question Details

Penny_lawrie, Home Buyer in Santa Cruz, CA

What are co op and resident owned mobile home parks and how do they differ?

Asked by Penny_lawrie, Santa Cruz, CA Mon Aug 20, 2012

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I've been looking around. A really nice sales agent at a co-op mobile home park explained it to me. For the most part banks will not lend you money to you to buy into the co-op. It costs about $28K a share plus the cost of a home. An older home from the 70s can go for as low as $30K. You own a share not the land. You still have an HOA, but even the rates here were great, I think they were only $160 a month. The problem is if something happens to your home you own like it burns to the ground you still own a share and have to keep paying the HOA. To get a new home, they only allow never ones with rules about an elevated enclosed porch, car port, etc that would make it very expensive to put a newer home in. The benefit is that it better than lot rent which is throwing your money away. In this area it's at least $700 so in 4 years you would pay more than the $30K and own nothing, but your costs increase every year. There is a smaller one in that area where you do own the land, but it's not like regular land where you can build a home, you can only place mobile homes there, and you still have to follow HOA rules, but they don't have a pool or amenities so the HOA fees are about $60 a month. Worst is lot rent, Co-ops are a cheaper alternative to live there, owning the land will increase your chance of selling and your buyer getting a loan.
1 vote Thank Flag Link Fri Oct 3, 2014
Kayavila, this is a great question for our Q/A forum. This may help you out somewhat.

43.6 General provisions: http://www.co.lake.ca.us/Assets/CDD/ZoningOrd/Zoning+Article…

(b) The owner or operator shall have a resident manager on duty at all times who shall be responsible for such compliance in the absence of the owner or operator.

I don't have the time to research the exact code reference but there are some HCD Title 25 requirements that require a park manager be on duty 24/7 365 depending on the size of the park and how many spaces there are.

If you really need an answer it's in Title 25 in the link above. Good luck.
0 votes Thank Flag Link Wed Jun 12, 2013
Is there a state or federal law mandating that a resident owned condominium senior mobilehome park
have a on site 24/7 manager?
0 votes Thank Flag Link Wed Jun 12, 2013
Actually MH condo conversions and sub-divisions have been around for almost 3 decades so their not necessarily a new phenominum. The one thing that wasn't addressed that I would even like clarification on is reverse mortgabes which are very important to seinors today.

I'm not aware of any coops that have provisions for this. If there are I would surely like to know about them and how they work with respect to comps, appraisals, LTV, etc.
0 votes Thank Flag Link Sat Sep 1, 2012
A co-op is one form of ownership. Broker Arendsen's answer is correct, but as an owner in a resident owned mobile home park that is a co-op, I would like to add a few comments.

It's true that financing can be troublesome. There are only a few lenders that will finance a coop purchase. If you have good credit and stick with those lenders, there isn't a problem.

Our corporation doubles as our homeowner association and we are covered by the same laws that apply to condos (i.e. Davis-Stirling) as well as the laws governing corporations, and various laws that pertain to manufactured homes.

To say it doesn't compare to owning your property isn't true. Other than my above comments, it is the same as living in any other resident owned park. There is even one extra benefit. We have the right to approve buyers based on age (55+) and income before they are accepted for membership.

Resident owned mobile home parks are a relatively new form of ownership. Here in California they provide a financially resonable alternative to our expensive housing market. Get a knowledgeable agent to help you buy and you will find it can be a great lifestyle.
0 votes Thank Flag Link Sat Sep 1, 2012
A coop is a corporation whereby each homeowner owns a percentage of stock usually 1 percentage share ot the park/community and shares in the grounds and amminities maintenance. Example: Let's say there's 100 spaces in the park/community. Each resident would own 1/100 or one share of the stock.

In a coop you do not have any equity in the real estate and it is therefore very difficult if not impossible to borrow against it. It's a cut above just renting/leasing but by no means does it compare to owning your property.

In a condo conversion the homeowner owns their airspace in much the same way as you would in any condo development. You share the cost of maintanence and common grounds. You can obtain a home loan on a condo in much the same way as you do on any real estate purchase (conventional forward or reverse mortgages) providing the home was built after June 15, 1976 and has an engineered certified foundation system under it.

There there's a sub-division which is another form of a conversion from a rent/least park/community where the homeowner actually owns their own lot and not just the airspace. In this situation the same rules apply for loans as in condo-conversions.

In both condo conversions and Sub-divisions it can be pretty tricky at arriving at fair and accurate LTV's as the age, style, condidion, size and value of the homes can change drastically making it difficult for appraisers to arrive at consistant values.

Planned Unit Development (PUD) Here an entire community was designed, developed and built out as a resident owned Manufactured Home Community from it's inception. All the homes typically had to meed certain CC&R's (codes, condidions & restrictions) on exterior finish, architectural style, set back requrements etc. These are usually new communities built circa 80's and newer.

The same lending conditions apply here except because they are newer and more consistantly designed and maintained according to development rules and regs they tend to comp out more evenly and equally making it much easier to arrive at adequate LTV ratios.

Finlally there are individual privately owned lots or parcels on private property that are not connected to any type of park/community, condo, sub division or PUD. These types of developments can often be tricky as appraisers usually have to be able to comp a manufactured home within a 10 mile or less radius from the subject property which can be difficult if there are none in the immediate area. Hope this helps.
0 votes Thank Flag Link Wed Aug 22, 2012
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