Is this a bad idea?

[wetcandle]

This seems like a group of pretty smart folks - I'd like to run an idea I have by you. I live in a newer subdivision, with little parking space, and it's more or less illegal to so much as open my hood in my own driveway. My collection of vehicles is ever growing, and I need more space to park and work on them. <br /><br />I'm thinking about getting a few acres out in the country, and building a small shop. I found 5.6 acres that I like that would cost me about $400 a month. That's a lot of beer/gas money. <br /><br />Here's my idea: I could fence of approximately 1 acre of the land from the rest of the property. I could then rent/lease that land out to 2-3 RVs to help pay the mortgage on the land.<br /><br />I owned a rental home for a little while many years ago, so I know a little bit about dealing with tennants, but not much. I wouldn't really have to ever do anything for them though, since they bring their own house. <br /><br />My questions: Do you think this would be more trouble than it seems on paper? Seems like a pretty easy way to basically get free land to me. Do you think it would be reasonable to rent roughly 1/4 to 1/2 acres out in the country for $100/month? It's not TOO far out, but the two closest towns only have about 5000 people each.

 

[deputydawg]

Re: Is this a bad idea?

Have a friend that is in the process of doing this, except he is renting to about 10 RV's. He is close to a lake so it was easy filling his lots. If you have a market it may be a good idea financially.<br /><br />Things to consider...<br />The people renting will want electricity. Check cost of running electricity to their sites, and what amperage you will provide.<br /><br />They might want, or the local codes might require a sweage system. Septic or whatever can be expensive, check these rules.<br /><br />Roads in and out of the lots need to be decent to keep the lots full. <br /><br />Maintenance on land... Most people who live like this will not own a mower. Will this expense be too high?<br /><br />My friend ended up paying big big money out for the electricity and sewage, and drinking water into the place. It took a year or so to pay for this with the lot rent. But now he is making money on top of his payments and taxes.<br /><br />He also built a car port onto each lot to park a car and a boat. Then he went to the other side of his property and built 20 storage units big enough for boats. These bring $30 a month each and are all full.<br /><br />He did have to go to the county county commisioners and re-zone the land. It was a lot of work but in the end he is making good money off of it. Of course he has about 10 acres to start with.<br /><br />Could be worth it in the future if all requirements could be met and someone wanted to move in there.

 

[KRS]

Re: Is this a bad idea?

Is it zoned as a trailer park (that's what you'll have when you rent space out)? Is it zoned for your workshop? Will zoning allow more than one family to live on this size lot?<br /><br />In addition to being a landlord... you'll become a business owner (rental business). You'll need to file a business return, incorporate or LLC to protect yourself and your assets. Pay taxes, etc.

 

[BoatBuoy]

Re: Is this a bad idea?

I'd take the $400 and the other money it'll cost, and add it to current house payment and move to a more tolerant neighborhood.

 

[wetcandle]

Re: Is this a bad idea?

deputydawg - I would definately provide them with electricity, water, and sewer. I would be more interested in permanent residents, rather than camping for the week type residents. I do have the thought in the back of my mind that if it does work well with a couple tennants, I could expand and make a good profit; though I'm not really interested in dealing with that much now.<br /><br />azfyrfyter63 - I still have to check into the zoning and everything, but I don't think it would be a big issue. It's out in the sticks where pretty much anything goes. There are already a few trailer parks in the area. Do you really have to incorporate and all that just to rent to a few people? I know I didn't have to when I just rented out one house. <br /><br />BoatBuoy - my point here is to NOT pay the additional $400. <br /><br />Thanks for the input guys.

 

[deputydawg]

Re: Is this a bad idea?

Most of my friends tennants are winter migrants. They stay here in the spring summer and fall because family is here and they grew up here. But for health reasons or just comfort they run away in the coldest parts of the year to a similar place in Florida, Texas or Arizona. His land is almost empty in the winter months. He only allows camping trailers (5th wheels) and motor homes.

 

[JasonJ]

Re: Is this a bad idea?

What about creating a storage type facility, like for boats and stuff like that. There are all sorts of those things in my area. Poeple buy land, throw up big pole barns, and store boats and RVs and stuff in them. None of them have anyone living there. Security would be the only concern I would imagine...

 

[Wimperdink]

Re: Is this a bad idea?

Like jason said... people here pay 40 to 50 dollars a month to park their rv's and boats in areas like what your talking about. There is more than likely more people in your very neighborhood that are in your position and that you could rent to. Gotta believe insurance on storage property is cheaper than property that people are living on. A fence is cheaper than putting in electricity and water and sewage.

 

[wetcandle]

Re: Is this a bad idea?

Originally posted by JasonJ:<br /> What about creating a storage type facility, like for boats and stuff like that.

I thought about that, but because it's so far out, I don't think there would be very much demand for it. I would have to deal with a lot more customers to make around $400 a month too. <br /><br />What do you guys think, would there be a big demand for cheap RV/boat storage 20-30 miles from any large town? My thinking is that the economy isn't very great out there - there's alot more people living in trailers full time than there are vacationing in them.