It's Real

MOBILEHOME VALUES

Do mobilehome values decrease when space rents go up? Yes/No/Maybe

The correct answer is Yes. The possibility of excessive rent increases in the absence of regulations is not merely theoretical. In some parks, park owners have instituted space rent increases of several hundred dollars per month. 

In such instances, mobilehomes have lost much or almost all of their value and have become unmarketable. An appraiser's rule of thumb is that the value of a mobilehome decreases by $10,000.00 for every $100.00 increase in the monthly space rent.  Some coastal “resort” parks charge rents in excess of $2,500.00.


RENTS IN ANY AMOUNT

Do park owners have free rein to raise space rents? Yes/No/Maybe

The correct answer is Maybe. One aggressive park owner expressed their right to unlimited rent increases, as follows:

"It is important to realize that the Legislature has given park owners free rein to charge any rent they choose; the only exception being local rent control ordinances.  Since park owners are free to set rents in any amount, the formula they use to establish rents is not subject to legal attack. Indeed, a park owner is allowed to set his rent by throwing darts at a dart board, using a Ouija Board, or otherwise." (1)

REFERENCE
1. Ackerman v. Dougher, Orange County Superior Ct. No. 644718, quoting from park owner’s Reply to Memorandum of Points and Authorities filed 6/15/92 at p. 4.

Source: The GSMOL Mobilehome Rent Stabilization Ordinance Handbook, Second Edition: Guidelines for Drafting and Enacting a Mobilehome Rent Stabilization Ordinance.

Prepared by: Bruce Stanton, Esq., Corporate Counsel

Image courtesy of ddpavumba at freedigitalphotos.net.