Mobile Home Park Cap Rates and Deal Math: A Worked Example for 2026
Use this first-pass check to turn a park listing's asking price and claimed net operating income (NOI) into numbers you can compare. You will calculate price per space, implied NOI, and indicated value. The result is a screen, not an appraisal or an offer.
This is general information, not legal, tax, title, utility, or financing advice. Underwriting, lending, tax, title, utility, and local rules vary by state and locality. Confirm them with qualified professionals before relying on a purchase analysis.
What a cap rate measures
A cap rate is annual NOI divided by market value. Rearranged, indicated value equals NOI divided by the cap rate (Virginia Tech Real Estate Glossary; NYU Stern's cap-rate explanation, general real-estate finance definitions consulted October 2026).
Cap rate is not cash-on-cash return. It does not include the buyer's loan terms. A national cap-rate average is a market reference, not the correct rate or value for one park.
Current U.S. market references
Northmarq reported a $58,400 median sale price per space and a 6.3% average cap rate in its United States, year-to-date Q1 2026 manufactured-housing-community transaction data (Northmarq Q1 2026 report, p. 6 for price and p. 1 for cap rate). That is useful context for a listing, but it does not set a universal rate for every stabilized park, state, metro, utility setup, home mix, occupancy level, or financing structure.
The report shows why a single benchmark needs care. It says some 2026 transactions closed at roughly 4.0% to 5.0%, while several closed at 7.5% to 10.5%. It also says about half of 2025 transactions were between 5.0% and 7.0% (Northmarq Q1 2026 report, United States, p. 6). Those observations are not a pricing rule or an approved underwriting range. Find comparable transactions and property-specific evidence.
For perspective, Northmarq's full-year 2025 United States data showed a 6.0% average cap rate and a $52,200 median price per space (Northmarq Q4 2025 report, p. 6). The worked example below uses those 2025 figures because it makes the math easy to follow.
Turn price and cap rate into an NOI check
Use these formulas:
Price per space = asking price / total spaces
Implied NOI = asking price x selected cap rate
Implied cap rate = verified annual NOI / asking price
Indicated value = verified annual NOI / selected cap rate
Price per space is an initial screen. It cannot replace verification of the rent roll, collections, expenses, infrastructure, occupancy, or legal site count. Start with the records in this mobile home park due-diligence checklist: reconcile the site count, then compare trailing rent rolls with deposits, invoices, taxes, insurance, payroll, repairs, and utility bills.
Keep utility reimbursement separate until the billing and records support it. Water and sewer billing rules for park owners explains why the applicable state rule, lease, tariff, bills, and allocation method matter before utility revenue goes into NOI. A projected rent increase also needs support: notice timing and applicable law can limit it, as explained in lot rent increase notice laws by state.
Worked example only: 100 spaces at the 2025 national median
This hypothetical example is not a real park, appraisal, offer, forecast, lender quote, or promise of return. It uses Northmarq's United States full-year 2025 median of $52,200 per space and 6.0% average cap rate (Northmarq Q4 2025 report, p. 6).
| Step | Calculation | Result |
|---|---|---|
| Price from space count | 100 spaces x $52,200 per space | $5,220,000 |
| Implied annual NOI at 6.0% | $5,220,000 x 0.06 | $313,200 |
| Value if the same NOI is priced at 7.0% | $313,200 / 0.07 | $4,474,286, or about $4.47 million |
| Value if the same NOI is priced at 6.0% | $313,200 / 0.06 | $5,220,000 |
| Value if the same NOI is priced at 5.0% | $313,200 / 0.05 | $6,264,000 |
The first line makes the assumed price: 100 spaces times the 2025 national median equals $5,220,000. At the 2025 6.0% average cap rate, that price implies $313,200 in annual NOI. A listing at that price claiming a different NOI would have a different implied cap rate.
Why one percentage point moves the price
The cap rate is the divisor in the value formula. Hold this example's $313,200 NOI unchanged and a move from 6.0% to 7.0% reduces indicated value by about $745,714, from $5,220,000 to $4,474,286. A move from 6.0% to 5.0% increases indicated value by $1,044,000, to $6,264,000.
That is why a one-percentage-point cap-rate assumption needs evidence, not optimism. The calculation only changes the rate; it does not establish that a buyer would pay either value.
Run the check on a listing
- Count legal sites from the site map and local records; do not rely only on the advertised count.
- Divide the asking price by that count to get price per space.
- Obtain trailing rent rolls, deposits, invoices, tax bills, insurance, utility bills, payroll, repairs, and records of required capital work.
- Reconcile the seller's stated NOI to those records and calculate the implied cap rate: verified annual NOI divided by asking price.
- Compare the result with relevant comparable transactions, while noting the Northmarq United States Q1 2026 observations of roughly 4.0% to 10.5% (Northmarq Q1 2026 report, p. 6).
- Write down the assumptions that drive the result, including site count, occupancy, rent collection, utility reimbursement, expenses, and capital work.
The national data can give you a starting question: does the asking price and verified NOI produce a rate that is supported by evidence for this property? It cannot answer that question by itself.
This is general information, not legal, tax, title, utility, or financing advice. Underwriting, lending, tax, title, utility, and local rules vary by state and locality. Confirm them with qualified professionals before relying on a purchase analysis.