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.
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 a free introduction to MHP-fluent lenders and brokers.