How Mobile Home Park Valuation Works
Parks are valued on the income the land produces: lot-rent NOI ÷ cap rate. That's the number institutional buyers, lenders, and appraisers anchor on — and now it's the number you have too. The biggest valuation mistake in this asset class is capitalizing park-owned home (POH) income at the park cap rate. Homes depreciate, home rent is management-intensive, and buyers strip it out. Value the dirt; treat POH as a separate (much smaller) line.
Use collected lot rent at actual occupancy, and rebuild the expense ratio yourself — small parks where the owner self-manages often show "25%" expenses that become 40% the day you hire real management and pay post-sale property taxes.
Choosing the Cap Rate
Indicative ranges as of early 2026 (verify with local comps — utilities move this number more than anything):
- Institutional-grade, city utilities, strong metro: 5-6.5%
- Solid mid-size park, decent market: 6.5-8%
- Small park, private utilities (well/septic/lagoon), tertiary market: 8-10%+
The Price-per-Lot Cross-Check
Divide the value by occupied lots and compare against recent sales: smaller or rural parks have commonly traded around $10,000-$30,000 per occupied lot, strong-market institutional parks at $50,000-$80,000+. If your cap-rate value implies a per-lot number wildly outside local comps, revisit your inputs — that five-minute check has saved many buyers from a bad letter of intent.
Valuation Notes by State (Midwest & Plains)
We see steady interest in state-specific park valuation — the Dakotas, Nebraska, Kansas, Missouri, Minnesota — and here's the good news: the method never changes. Lot-rent NOI ÷ cap rate works in Fargo exactly like it works in Phoenix. What changes are the inputs, and in rural Midwest and Plains markets they lean a consistent direction:
- Wider cap rates: smaller buyer pools and smaller towns commonly push caps to 8-10%+ versus 5-7% for institutional metro parks — the same NOI simply buys more park.
- Lower lot rents: $200-$375/month is common in rural Plains markets versus $400-$600+ in strong metros, so per-lot values run proportionally lower.
- More private utilities: wells, septic systems, and lagoons appear far more often outside city limits — budget real diligence for them and expect the market to price that risk into the cap rate.
- State rules vary: some states (Minnesota among them) give residents purchase-opportunity or notice rights when parks sell — check current state law and the state manufactured-housing association before you offer.
Practical translation: run the calculator above with local lot rents and a cap rate from recent in-state sales, and the estimate localizes itself. County assessors and state MHA chapters are free sources for both.
From Value to Offer
This is market value, not your maximum price. Vacant lots, infill potential, utility risk, and your financing all shape what you should pay. Run the full deal — financing, expenses, infill plan — through the Mobile Home Park Calculator, and walk the diligence list in our MHP due diligence checklist. New to the asset class? Start with the complete MHP investing guide.
Financing a park? Get matched free with MHP-fluent lenders and brokers.