dealer markup

[Diane Bellini]

Can you tell me what the average dealer markup is on the base price (without any options) of a manufactured home?

[Eugene]

Not really, it is based on the cost of the home, Plus most dealers get rebates after buying so many homes. So maybe they pay the manufacturer, $50,000 for a home that sells for $75,000, but at years end, if they bought enough homes, they can get a very large rebate, that would add to the profit margin.

[Bill Fry]

Most dealers set the price of a house for what they think they can get for it from that specific buyer (regardless of what they paid for it) Selling cars and MH homes have a lot in common though at least with a new car you have a window sticker to base a price from. When buying a MH home as with a car you have to do your own research ahead of time.

[HAL OVERBY]

DEALERS HAVE THE SAME DILEMA. WE DONT KNOW WHAT THE AVG COST OF A HOME FROM THE FACTORY IS. CHAMPION HOMES FOR INSTANCE ON A 32 X 80 OUT OF THE SANFORD, NC FACILITY IS $8,000.00 MORE THAN THE SAME CHAMPION HOME OUT OF THE LILINGTON NC FACILITY, A CLAYTON, SAME FLOORPLAN, IS $10-12,000 LESS BUT THE SAME QUALITY. SO TELL ME AS A DEALER, WHO IS MAKING WHAT? iN THIS CASE IT APPEARS THAT CHAMPION IN SANFORD IS CLEARING 8-10,000 MORE THAN THE OTHER FACILITIES.

IN AN EARLIER COMMENT STATING A DEALER BUYS A HOME FOR 50K MINUS REBATES AND SELLS THE HOME FOR 75K. THIS DOESNT MEAN HE MAKES 25K PROFIT, THERE ARE MANY COST SUCH AS SET UP ETC....

THE AVG DEALER MAKES A 7 TO 10 % PROFIT WHEN IT IS ALL SAID AND DONE. IT ALL DEPENDS ON WHAT THE PRODUCT COST IS AND AS I HAVE OFFERED AS AN EXAMPLE IN THE FOREGOING PARAGRAPH, THE DEALER DOESNT REALLY KNOW WHAT THE MANUFACTURER IS MAKING, ITS NOT UNIFORMED AT ALL AND EVERYONE BLAMES THE DEALER. SO PUT THE BLAME WHERE THE PROBLEM IS AND TO WHOM IS MAKING ALL THE MONEY,,,,,THE MANUFACTURER.

HAL OVERBY
HUNTERS CREEK HSG
SMITHFIELD, N.C.

[John]

Is the home you are thinking about already installed in a community you like?

Find out from community management if they have any outstanding space rent due before you close escrow and REFUSE to pay it (you did not live there, right??)

Usually a dealer selling a new home already in place will want to include this amount as 'hidden costs'. They may not pay for the space until the home sells in a lot of cases, depending on the relationship they have with the park.

If you are ordering a new home, do it like you would do a car; get them to include as many of your options as possible. Have a price for your total package in mind, if you are financing through a lender and this is not an outright purchase on your part, have a monthly figure in mind that would include your Mortgage payment, space rent, and insurance costs. Keep in mind that your space rent may increase periodically.... MOST IMPORTANT, STICK TO THESE NUMBERS! BE PREPARED TO WALK AWAY IF NECESSARY!

[John]

Also, another thougnt.....

If you have more than 1 or 2 dealers in your area and are negotiating a new home to be ordered, play them against each other, try to get away with as much as you can!!!

If the home is new and already onsite, you probably won't be able to get away with this...

If it is onsite, refuse to pay the costs for moving and setup (it is not YOUR fault the dealer CHOSE to place it in a space in a community you happen to like), in addition to any outstanding space rent that there very well may be.... Depending on how long it's been onsite, you may be able to negotiate things like carpet cleaning for a year, or a fresh coat of paint (inside and out).... Also, the longer the dealer has been trying to sell this home, the more he may be willing to give you.

Another time you can negotiate might be just after manufacturers announce new models for the year... Just like cars and motorcycles, dealers may be more open to negotiating points in anticipation of the new homes, if they are sitting on an old one, or the last of one....

GOOD LUCK

[belleshun08]

Just curious but I'm also planning to purchase my first new car and looking for the best deal. However, informal reports are emerging that an increasing number of dealerships are beginning to scale back their markups on aftermarket insurance and financing. The dealer finance markup, as well as dealer insurance markup, could be pretty high as often as not.