Park homes, sometimes referred to as ‘mobile homes’, are cheaper than traditional houses, are easier to look after and offer a sense of community. However, park homes do have some pitfalls, including how quickly they could potentially lose value. It can also be trickier to obtain a mortgage on a park home, and some have restrictions on living in one all year round.
Ultimately, deciding whether park homes are good investments comes down to what you need and want. They may not appreciate in value like traditional homes, but they do offer qualities which can make them an attractive option.
Nevertheless, read on as we answer some popular questions about park homes and see if we can help to make your mind up.
- What can you expect from living in a residential park home?
- Do park homes hold their value?
- How easy is it to sell a park home?
- The advantages and disadvantages of buying a park home
- So, are park homes a good investment?
What can you expect from living in a residential park home?
Living in a residential park home is a unique experience, and very different from living in traditional brick and mortar properties. While you can expect to enjoy plenty of privacy, park home communities are known to be quite sociable and friendly – everyone knows everyone.
A lot of park homeowners choose this tight-knit, peaceful lifestyle after getting away from the chaotic urbanity they previously lived in, perhaps even freeing up some equity in the process. Park communities are usually based in serene, picturesque environments as well, which can be an attractive quality – although there are still several smaller parks in the suburbs.
Park home living is most popular amongst retirees or semi-retired individuals – and many of them are listed as ‘over 55s’. However, in recent years buying a park home has become increasingly popular amongst younger individuals, as these properties are more affordable than bricks and mortar, easy to maintain, secure and can come equipped to cater for a modern way of living. The tricky part is often more to do with obtaining a mortgage.
It is worth noting that park home ownership means owning the structure of the property itself, and not the land it is based on. This land is owned by the park home site owner, who will most likely charge a monthly fee or ground rent to let residents live on their land. Important to factor this into the equation.
It is also important to remember that if a potential buyer wants to make their park home their permanent residence, the property must be based on a permanent residential park home site as opposed to a holiday site which would limit the amount of time you can reside there.
Do park homes hold their value?
Whether park homes depreciate in value greatly or not can depend on its age, where it is located, and whether there’s any kind of demand for park homes in the area. You can try to maintain as much of your park home’s value as possible by keeping it well looked after, and doing your best to prevent wear and tear.
Like all properties, the value of residential park homes can also be affected by the local housing market – and the economy as a whole. Before buying a park home, it’s a good idea to research recent sales of similar properties in the area to get a better understanding of the current market.
How easy is it to sell a park home?
The process of selling a park home is very similar to selling a traditional home in that the process can either be really challenging or incredibly smooth. All park homes are different, and how easy it is to sell one can depend on several factors.
The demand for residential park homes in the area you are selling, the condition of the park home, or how well-equipped the park home is with modern amenities, can all influence how smooth a selling process might be.
Did you know that site owners are still entitled to 10% of the sale price? This may deter park homeowners from selling, particularly if their property has already depreciated in value already. You are also expected to tell the park owner about the sale and tell the buyer to fill in a ‘Notice of Assignment form’.
We recommend enlisting the help of an expert or estate agent who can help you navigate the market and get the best price possible, for as little hassle as possible.
What is the Mobile Homes Act?
The Mobile Homes Act was introduced back in 2013 and has regulations which impact how owners sell park homes.
For example, if your park home was bought before the 26th May 2013, the owner of the park home’s site will have a much greater say in who your property will be sold to, meaning they can prevent you from selling to someone if they don’t believe they are a good buyer.
Park owners also had other rights, such as the ability to evict with court orders or prevent park homeowners from using an estate agent to help sell the property.
Despite this, you’ll be glad to know (as you’re most likely here as you’re yet to invest in a park home) that anyone who buys modern park homes after the 26th of May 2013 will have the right to sell their property to whoever they wish.
The advantages and disadvantages of buying a park home
When weighing up how to make an important decision, evaluating the advantages and disadvantages of making said decision can make things a little clearer.
We know pros and cons are always based on context and each person’s preference, but here’s a list of the advantages and disadvantages of buying park homes that we’ve put together, which might get you on the right track to deciding whether to buy a park home or not.
Advantages of buying a park home
- Affordability – park homes are an attractive living option for those looking to enjoy a more affordable way of living, compared to the more expensive traditional bricks and mortar homes.
- Low maintenance – these properties are generally low maintenance, as the park management will often take care of exterior maintenance, landscaping, and other communal areas.
- Enjoy the lifestyle you choose – park homes typically sit within close-knit communities where residents often know each other well and socialise. Nevertheless, they also do allow park home residents to have some privacy whenever they wish, meaning you have the freedom to choose how you wish to live in the community.
- Lovely environments – closed away from outside areas, a residential park community is known to be tranquil and quiet, surrounded by beautiful greenery, bettering holiday parks.
Disadvantages of buying a park home
- Can depreciate in value – as an investment option, the fact that park homes do not appreciate in value like traditional homes can be deterring.
- Additional fees – charges to use the land and certain site facilities could end up being unexpected park home costs and expenses. A site owner can also still make 10% of the sale price of a park home if you choose to sell.
- Downsized living space – typically, park homes have smaller living space and less storage than traditional homes.
- Modification restrictions – residents could be limited by how much they are able to customise their newly built or pre-owned park home living space if there are any site restrictions on making such changes.
So, are park homes a good investment?
Park homes can be a good investment for those who prioritise the lifestyle benefits they offer, such as location, low maintenance, affordable living, and a sense of community.
In terms of a financial return, park home ownership may not be a great idea if you are looking to make a significant profit in the future. Despite a newly built park home usually lasting over 70 years, and sometimes even longer if they are maintained well enough, they do depreciate in value and don’t offer the same investment value that traditional homes do.
Once you know what you want from your property and the type of lifestyle you wish to live, accompanied by some research of areas you like the look of, the decision to buy a park home will become a lot easier.
Have you spotted a park home you like and aren’t sure exactly what you need in terms of park home insurance? Howden has a team of park home, static caravan and touring caravan experts who would be happy to answer any questions you may have.
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