Higher than Market Rents

[Frank Larson]

My current monthly space rent here in Southern California is $617.50 a month. Presently my home is on the market. The prospective homeowners are being notified by management that their monthly space rent will be $799.00 per month. I've done an informal rent survey of other mobilehome parks in our zip code. One park of superior location, condition, and services charges only $645.00 for new homeowners. And parks of similiar location, condition, and services typically charge $535.00 to $560.00 per month. My realtor has my home listed for a lower price than similiar homes listed in these other parks, but is failing to generate interest in my home due to the premium charge for the space rent. Is there any obligation on the part of mobilehome management and/or owners to maintain rents at marketable levels? If the high lot rent was at least comparable to other parks, then I could accept it. But the rent here seems obscene when compared to other parks of superior and comparable amenities and location. It's obviousy having a negative impact on the home prices in this particular park. Do I have any options other than giving my home away or abandoning it? Thanks.

[Chrissy Jackson]

Well, you have asked a couple of interesting questions. First, there is generally no obligation on the part of the owners with regard to where the level of rent is set as compared to other communities - - - if there were, it would be a violation of federal anti-trust laws. Businesses cannot conspire together to set prices. The need of an owner is to set rents where the community will stay full or full enough to pay the bills. You state that your preliminary market research indicates that new residents coming into other communities will be paying less than your new rate of rent. That may be only half of the story. Many communities will offer discounted rates of rent in order to entice a new resident to move in. What are the existing residents paying? And - yes, I agree that the overall market conditions may well have a negative impact on your ability to sell your home. In order to overcome this, you do have some options. First, talk with your owner or manager to see if they will agree to offer a reduced rate of rent to a buyer of your home. Talk with other communities to see if they will pay for the cost of moving your home to their location and give you a reduced rate of rent. The numbers may work to your advantage to have that done. Or, to offer it as an option for a potential buyer. So, the buyer would buy your home, but then move it prior to living in it. Please let me know if any of this helps.