Quick answer
In a land-lease community you buy the home and rent the space it sits on. Your monthly cost is space rent plus your loan and insurance, and space rent can go up. Read the rental agreement and park rules before you make an offer, and apply to the park early.
By Ryan Kuchler
Ryan also owns and operates a manufactured home community, so he has been on both sides of the space-rent conversation.
Key points
- A home on a rented space is usually titled through California HCD, not recorded like a house.
- Loans on homes in land-lease parks are often personal-property (chattel) loans, with different rates and terms than a mortgage.
- California's Mobilehome Residency Law sets the rules between you and the park, including how the park approves buyers.
What you own and what you rent
When you buy in a land-lease park you are buying the structure. The park owns the land, the streets, and the clubhouse. You sign a rental agreement for your space and pay rent to the park every month, on top of whatever you owe on the home.
That split affects everything else: how the home is titled, how it's financed, what you pay in taxes, and who has a say when you sell.
Price the space rent like a second mortgage payment. It's the number most buyers underestimate.
Three ways to own a manufactured home
| Setup | Who owns the land | Monthly cost | Typical title |
|---|---|---|---|
| Land-lease park | Park owner | Space rent + loan | HCD registration |
| Resident-owned park | Residents, through a co-op, corporation, or subdivided lots | Dues or assessments + loan | HCD registration plus an interest in the land |
| Your own lot | You | Loan + property tax | Can become real property when installed on a permanent foundation |
How financing differs
Fewer lenders make loans on homes in land-lease parks, and those loans often carry higher rates and shorter terms than a standard mortgage. Because you don't own the land, the loan is usually secured by the home alone.
Talk to a lender who does these loans every week before you start shopping. They can tell you which parks they will lend in, how old a home they will finance, and what down payment to expect.
Questions to ask the park before you offer
- What is the current space rent, and how much has it gone up each year for the last five years?
- What does the rent include: water, sewer, trash, landscaping?
- Is the park age-restricted? What are the pet, guest, and rental rules?
- What does the buyer application require, and how long does approval take?
- Are there any rules about the age or condition of homes, or about leaving the home in place when it's sold?
- Does a city space-rent ordinance apply to this park?
Inspect the home like a house
Get an inspection from someone who knows manufactured homes. Homes built after mid-1976 carry a HUD certification label and a data plate; ask to see both. Look closely at the roof, the skirting, the tie-downs, and any additions, since add-ons like carports and Arizona rooms need their own permits.
Frequently asked questions
Do I pay property tax on a manufactured home in a park?
It depends on the home. Homes first sold new after July 1, 1980 generally pay local property tax. Many older homes pay an annual license fee to California HCD instead.
Can the park turn down my purchase?
Yes, within limits. Under the Mobilehome Residency Law a park can require buyers to apply and can reject a buyer who can't show the ability to pay the rent and charges. Apply before you remove your contingencies.
Are there 55+ manufactured home communities in the Coachella Valley?
Yes. Many parks in the Coachella Valley are age-restricted senior communities. Ask for the park's age policy in writing, since it decides who can live in the home and who you can sell to later.
This article is general information, not legal, tax or lending advice. Rules change; confirm details with the relevant agency, your lender and a qualified professional.
