What is market rent?
For such a critical question—one that every investor should be able to answer when evaluating income property—I’m always surprised by how few can. This is especially true in the case of mobile home parks, where the wide range in asset quality makes researching and establishing market rent deceptively difficult.
At its core, market rent refers to the rental rate a property could reasonably command in an open and competitive marketplace based on the location, condition of the asset, comparable properties, and local demand. It’s not necessarily what current tenants are paying, but rather what new tenants would agree to pay today for the same space. Understanding that distinction is key when assessing upside, risk, and overall value in an investment.
How to research market rent for mobile home parks
The brokerage community is a good place to start when gathering information on prevailing rents at nearby mobile home parks. But that's only the start. The rent charged at a high-quality park in a central location, for example, has little relevance to a compromised property with substandard homes or infrastructure.
Also, mobile home parks tend to have lower turnover than apartments or other types of residential rentals, meaning that current rents at stable parks often lag behind what market rent should be. To get an accurate picture, look beyond other parks: evaluate rents for local apartments, single-family homes, and even hotels. Pulling all that data together can offer a more complete view of what the true market rate is in the area.
What will rent growth look like?
The Pacific Northwest has seen tremendous rent growth over the past 15 years, but it’s unlikely this trend will continue at the same pace. Why? For starters, rents have already risen to market levels—and quickly. Space rents above $1,000 per month are now common, whereas just a few years ago they were virtually unheard of.
When applied to these higher rents, the same percentage increases as in years past become unsustainable. A $100 rent hike is a major jump, whether the starting rent is $400 or $1,000. That’s why operators must consider both the percentage and the actual dollar amount of any proposed increase.
Factors that can skew market rent
Market rent figures can be misleading—intentionally or not. One common tactic is cherry-picking the comps that justify the highest possible rent (brokers do this all the time to maximize listing values). Relying on a single set of comps is never advisable. You need to conduct direct, on-the-ground research and look for those overlooked properties charging significantly less than reported averages.
Another distortion arises from rapid, unsustainable rent hikes. The recent investor rush into the region has led to “false” comps—situations where a disreputable operator imposes an aggressive rent increase, then reports that inflated figure as the new “average.” It’s also wise to talk directly with tenants to verify whether the stated rent is actually being paid.
Is it really that important?
Absolutely —but only as part of the bigger picture. Knowing the true market rent helps operators assess whether a property is underperforming, overpriced, or has upside potential. It informs revenue projections, guides upgrade decisions, and helps avoid flawed assumptions that can sink a deal.
That said, market rent isn’t a magic number. Buying a property that needs repairs and upgrades, then executing a solid value-add strategy, typically leads to increased rental revenue—if done well. Tenants are generally willing to pay more for a well-maintained community, which in turn reduces management headaches. On the other hand, poorly executed improvements or superficial upgrades that don’t enhance the tenant experience can backfire—leading to vacancies, resistance to rent increases, and reputational damage in the local market.
Ultimately, understanding market rent is essential—but success comes from combining that insight with disciplined execution, thoughtful planning, and a long-term view of resident satisfaction.