Archive for September, 2012

MHIndustry Leaders. Where taking us in 2013?

Sunday, September 30th, 2012

Blog # 213 Copyright 2012 30 September 2012

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

I.

MHIndustry Leaders! Where Will YOU Take Us in 2013?????

II.

An Exciting New Manufactured Housing Show Concept for HUD – Code Manufacturers & LLLCommunity Owners Nationwide!

***

I.

MHIndustry Leaders! Where Will YOU Take Us in 2013?????

How’s the old bromide go? ‘Lead, Follow, or Get the Heck Out of the Way!’ Yep; that’s the one I think rightly sets the stage for the upcoming Manufactured Housing Institute annual meeting in San Antonio, TX., from 7 – 9 October 2012. Will YOU be attending? If you’re a direct, dues – paying member of MHI, and or its’ National Communities Council division, you should be! Carolyn and I certainly plan to be there. For information, phone Dick Jennison @ (703) 558-0678 or Jenny Hodge @ (703) 558-0666.

Why the push to participate? In our case, we’ve been hearing from manufactured housing aficionados and land lease lifestyle community owners/operators, across the U.S., and via the Allen Letter professional journal, that the HUD – Code manufactured housing industry has reached a ‘tipping point’. Not for the first time in our industry’s 60 year history, but certainly for the first time in awhile. Land lease lifestyle community folk, (then) manufactured home community ‘players’, experienced a tipping point on 2/27/2008, when the first National State of the Asset Class caucus (Since retitled as MHInitiative®) convened in Tampa, FL., and 100 owners/operators charted their collective business destiny via a Five Point Plan that’s still in place to this day! And a year later, 2/27/2009, another 100 MHIndustry & LLLCommunity owners convened for a one day NSAC caucus in Elkhart, IN.; this time around, to figure out ‘How to Sell More HUD – Code Homes into (then) Manufactured Home Communities!’ Now we’re looking at year 2013, coming up in a scant three months. The tipping point this time around?

– Either we finally and authoritatively seize control of our collective business present and future, relative to (affordable housing) Product, (home buying & site leasing) Prospects, and (increasingly regulated financial) Profit; OR, we continue to experience the 60 year shipment nadir endured these past ten years! – It’s as simple as that. Which will it be? A new & bold Plan, Rebranding or What?

Land lease lifestyle community owners/operators already lead the way, when it comes to flexibility and creativity; doing whatever it takes, to fill an estimated 250,000 vacant rental homesites nationwide! They’re buying and reselling, even self – financing (via contract sales, captive finance, & lease option), and lately even leasing, ‘repo’, new and resale manufactured homes, two story modular homes, ‘park model RVs’, RVs for a season, even stick – built homes fabricated on – site to mimic HUD – Code homes! And they’ve even gone a ‘big step further’, by rebranding their unique, income – producing property type as land lease lifestyle communities, or LLLCommunities, for short.

Some HUD – Code home manufacturers are attempting, at least in part, to follow their lead (i.e. Where’s today’s manufactured housing market? In land lease lifestyle communities where owners/operators market ‘affordable’ Community Series Homes or CSH models, to traditional markets of those ‘newly wed & nearly dead’, using whatever home finance models that work in their respective market, e.g. 21st Mortgage Corporation’s exciting C.A.S.H. Program, and others!), but they’ve a long long way to go. For example:

– HUD – Code home manufacturers have CSH model home designs in hand, but still exhibit ‘big box = big bucks’ Developer Series Homes in plant and regional home shows. Why? They build what they want, NOT what customers will buy!

– HUD – Code home manufacturers now invite land lease lifestyle community owners/operators to plant shows, to see and buy new product. But again; only 10 percent of the display homes are CSH models with durability enhancing features.

– A couple HUD – Code home manufacturers have prepared & distributed Position Papers, describing their firm’s view of contemporary MHIndustry trends, and how they’re addressing CSH model opportunities. Think Cavco & Champion. Others?

– At the 2nd NSAC caucus, 2/27/2009, nearly three dozen Business Development Managers or BDMs were named. How many are active today? Only a dozen, when there’re home sales opportunities for dozens, selling into LLLCommunities.

And there’re initiatives occurring within other segments of the MHIndustry. For example:

– Renewed interest in the 3:1 Rule of Thumb, designed to ensure land lease lifestyle community rental homesite rents are in sync with other forms of multifamily leased housing in the same local housing market. Specifically; it takes the monthly rent from three LLLCommunity sites to equal monthly rent generated by one large (3BR2B) apartment or town house in the same locale.

– Increasing commitment, on part of LLLCommunity owners/operators and independent chattel lenders, to NOT sell more house, to a prospective homebuyer, than they can afford. How to effect this? Ensure monthly PITI (principal, interest, taxes & insurance premium) AND household utility bills (gas, electric, water, sewer) are included in the 30% Housing Expense Factor

Back to the upcoming MHI annual meeting! What needs to be done to address the aforementioned ‘tipping points’ for the manufactured housing industry and land lease lifestyle community asset class? Well, it’s doubtful much progress will be made at just one meeting – especially since there’s been, as of 30 September, NO preparatory material distributed to members – not even a formal solicitation of agenda recommendations for various industry segment meetings, readying ‘us’ for heady discussions. So, heeding the suggestion made in blog posting # 211, on 9 September, our elected and salaried national leaders might consider forming an all volunteer (Not appointee!) Blue Ribbon Task Force, comprised of one or two dozen businessmen and women, from large and small firms, from throughout the U.S., and across industry segment lines, to identify and address our industry/asset class’ most troubling issues, e.g. lack of a secondary manufactured housing sales market, lack of chattel loan programs, lack of manufacturer interest in building affordable homes, ‘Just what is an affordable home?’, etc..

II.

An Exciting New Manufactured Housing Show Concept for HUD – Code Manufacturers & LLLCommunity Owners Nationwide!

Coming off the ‘biggest & best Networking Roundtable’ in 21 years; then two weeks later, being a guest at the ‘2012 Knoxville Showcase of (19 new HUD – Code units) Homes, Clayton County Fair’, has been something of a sensory overload. Perhaps those two stellar industry events combined to inspire this preliminary plan for the Fall of 2013…

At a hotel location yet to be decided, but maybe in Nashville, TN., or Detroit, MI., or – where would you like to see it held? Just remember; the resort hotel has to be within a half hour drive of a major international airport, able to accommodate more than 250 overnight guests, and have plenty of meeting space for that number.

The exciting new manufactured housing event for HUD – Code manufacturers and land lease lifestyle community owners/operators? How ‘bout this:

‘22nd Networking Roundtable & 1st Community Series Home Show!’

I don’t see much, if any change, to the 2 ½ day education, networking, and deal – making program we’ve honed these past 21 years. What I do envision, however, is a new CSH model home display, of one or two dozen new CSH model homes, located right outside the meeting room exit, that’ll be in place two days before the Networking Roundtable event actually begins, and heavily marketed to LLLCommunity owners/operators in local housing markets within 100 miles of the host meeting facility. And of course, Roundtable devotees would be encouraged to arrive at least a day early for that event, to spend time ‘walking (and ordering) the homes’. An added feature would be morning and afternoon seminars describing ‘How to Effectively Sell New Homes into Land Lease Lifestyle Communities’ &/or ‘How to Self – finance, Lease – option, and or Lease New Homes in Your LLLCommunity’. What do you think?

As I said earlier, these are all preliminary plans. But I’m serious about them, having already contacted a couple resort hotels with large parking (potential exhibit areas) adjacent to their meeting facilities. And if you have suggestions to make, to this end, let me know via the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

Some of you are probably reading this and thinking: ‘Hmm. Doesn’t read like a guy who’s trying or planning to semi – retire in the relatively near future.’ You’re right; but the way I look at it, why not get this ball rolling, to establish a new and exciting, expanded event (i.e. addition to the annual Networking Roundtable). Then, if it appears I’ll be handing the 22nd annual event off to someone else, I’ll still be around to assist; and if still no personal ‘exit strategy’ is in place by then; well, we’ll have another bang – up time together, like we just did in San Diego, CA.. Reads like a WIN – WIN opportunity for HUD Code home manufacturers and land lease lifestyle community folk either way! Are you on board?

***

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

‘Book of Numbers’ debuts & NCC mtg. @ 10/8

Sunday, September 23rd, 2012

Blog # 212 Copyright 2012 23 September 2012

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

I.

‘Book of Numbers’ debuts @ Networking Roundtable. Want a copy for your reference & use? Only $19.95 each

II.

Showdown or Business as Usual at MHI’s National Communities Council division Meeting on 8 October?

I.

‘Book of Numbers’ debuts @ Networking Roundtable. Want a copy for your reference & use? Only $19.95 each.

‘Book of Formulae, Rules of Thumb, & Helpful Measures’, mostly for land lease lifestyle communities & HUD – Code manufactured housing, as well as commercial real estate investment, affordable housing, and realty – secured mortgage origination. Yep, that’s the long title for this 78 page ‘first ever’ compilation of most, if not all, the formulae, rules of thumb, and measures common to our realty asset class, housing type, investment environment, and mortgage scene. In addition, the Official MHIndustry & LLLCommunity Lexicon & Glossary have been appended to the text proper.

So, if you’d like to purchase one or more copy for your reference and use; or for that matter, all your on – site property managers, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Retail price is only $19.95 plus shipping cost. And a quantity discount is available for when purchasing 20 or more copies of this book at a time; with book price dropping to $10.00 per copy, plus bulk shipping cost. Already, 250 copies were distributed at the aforementioned Networking Roundtable, and more than six dozen since then, to property portfolio owners/operators wanting the ‘book of numbers’ in the hands of their regional and on – site property management staff. How ‘bout YOU?

II.

Showdown or Business as Usual at MHI’s National Communities Council division Meeting on 8 October in San Antonio, TX? ‘Come on down & meet Jenny Hodge!’

A year ago this coming February, at MHI’s annual Legislative Conference, when the National Communities Council division last met, members in attendance were assured the there’d be more done, by the NCC during 2012, to ‘reach out’ to small to mid – sized ‘players’ throughout the realty asset class in the U.S. However, that doesn’t seem to have been what’s happened – and probably for arguably good reason.

To begin with, the salaried executive assigned to oversee the NCC division at the time, went on maternity leave. Shortly thereafter, a firm founded by former MHI executive Bruce Savage, was contracted to function, in part, as the institute’s communications consultant, and interim oversight of the NCC division. Well just recently, former American Modern Insurance middle level executive, Jenny Hodge, was hired to head the NCC fulltime! This makes for three execs during the past 12 months; or looking back over the nearly 17 years of council presence, a total of six execs and a year or so leaderless hiatus, during that overall time frame.

So, ‘what’s the rub’ regarding small to mid – sized owners/operators and portfolios of land lease lifestyle communities in the U.S.? Well, an estimated 85 percent of 50,000+/- LLLCommunities contain 100 and fewer rental homesites apiece. So it stands to reason that ‘a’, if not ‘the’, prime focus of the NCC division, founded 1 January 1996, should be recruiting small to mid – sized owners of these properties. As it stands today, however, all elected offices of the NCC are held by salaried executives from three of the eight largest (As listed in the 23rd ALLEN REPORT) LLLCommunity portfolio owners/operators in North America. In and of itself, there’s nothing wrong with this ‘state of affairs’; BUT, what is being done to bring more small to mid – sized owners/operators of the unique, income – producing property type into the national advocacy fold? Interestingly, at the last NCC division meeting, of the dozen or so direct dues – paying members present, all but one or two of the non – officers present, were small to mid – sized property owners/operators. Know what? If the NCC division was truly active and engaged, relative to asset class issues and the like, there’d likely be double and triple that number of members present at these biannual meetings!

Earlier this year, an informal alternative slate of officers was drawn up and considered to run against the sitting elected NCC officers. Effective with the posting of this blog, that’s unlikely to happen, unless yet another group of NCC members decides to make such a push. Why the pulling back? Call it ‘one last chance’ for present elected NCC officers to get it right, especially now that an MHIndustry – experienced executive is on board who has the ability to ‘get things (finally) done’. But what happens if year 2013 turns out to be continued inaction’? Well, here’s a bit of irony that’ll become crystal clear more than half way through the year. For it was on 31 August 1993, 20 years ago, the Industry Steering Committee (predecessor to MHI’s NCC division) met in Indianapolis, IN., to lay the groundwork for a formal national advocacy presence that’d be needed a year or two later, when several large (then) manufactured home community portfolios would launch IPOs (‘initial public offerings’ of their stock) to become real estate investment trusts (REITs). As it turned out, the REITs materialized in 1994 & 1995, and the NCC was launched 1 January 1996.

Today, there’re but three REITs left, as three others have ‘come and gone’. Some or many of us believe the time has come for the NCC division to reinvent itself. Hence the reason for a push to attract and serve more of the ‘85 percenters’ (i.e. LLLCommunities numbering 100 and fewer rental homesites apiece), than we have in past years. In the meantime, back to a little more NCC history….

For the first several years, ‘there was a lot going on’, and a lot of enthusiasm, in and around the NCC – though not yet a full fledged division of MHI. We started and funded a property excellence recognition program, but for all practical purposes it ended. We tried to launch a new LLLCommunity quality rating system, to replace the Woodall STAR System that died in 1976, but it, the ABClassification system, was politicized, and is today, a private enterprise effort,

And as our housing finance bubble burst at the turn of the century, a full eight years before site – building followed suit, NCC momentum waned. Tri – annual meetings that attracted 40 – 50 participants and observers, today attract half that number. New projects, forums, and the like? If of interest to large property portfolio owners/operators, initiatives are funded and launched. But, when was the last time we sat down together to parse, discuss, and seek solutions to widespread challenges to our asset class? I can’t recall. One example; ‘lack of a secondary housing sales market’, to this day, and why/how said absence stifles our ability to sell and site new homes in our LLLCommunities! At the 21st annual Networking Roundtable, in San Diego, two weeks ago, this was the very issue that concluded that event. About 50 of us sat informally together in the main conference room, and talked frankly about the crazy ways we value our homes, mixed success at launching multilisting services, the need for licensing, and escrow closings. Know what? It was all for naught; as there was no one present from either of the national advocacy bodies (where this sort of discussion belongs), and no one present at the meeting to ‘lead us forward’ to solve that perennial and strategic problem. Could be the NCC division though….

So, look for year 2013 to be a pivotal one in the almost two decade history of MHI’s National Communities Council division; but in the meantime, at the NCC division’s meeting during MHI’s annual meeting in early October, what might well be on the minds of council members gathered for the event….

***
George Allen, CPM & MHM
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

HB3849 & SB3484, & flawed MHBusiness model

Sunday, September 9th, 2012

Blog # 2011 Copyright 2012 9 September 2012

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

I.

HB3849 & SB3484 Won’t ‘Fix’ the MHBusiness Model, but….

II.

List of 25 Most Influential Persons in Manufactured Housing & the Land Lease Lifestyle Community Asset Class almost complete!

III.

Mark Your Calendar with these Dates Now! The MHIndustry & LLLCommunity Businesses of Today will be Different Tomorrow!

I.

HB3849 & SB3484 Won’t ‘Fix’ the MHBusiness Model, but…

House Bill # 3849 & Senate Bill # 3484 won’t ‘fix’ the MHBusiness Model; but portions thereof, address two mortgage finance regulations being developed by the Consumer Financial Protection Bureau (‘CFPB’), as required by the Dodd – Frank Wall Street Reform and Consumer Protection Act (P.L. 111-203). Two regulations potentially impacting HUD – Code manufactured housing industry’s ability to provide truly affordable financing options to low and moderate income individuals and families desiring to purchase our unique, transportable, quality, ‘green’, non – subsidized housing product.

In the first instance, this legislation proposes a reduction in the threshold by which small balance manufactured home personal property (‘chattel’) loans are considered ‘High – Cost Mortgage Loans’ (‘HCML’). A HCML is considered to be a predatory loan, when the annual percentage rate (‘APR’) of the loan, is considered high, compared to Government Sponsored Enterprise – subsidized rates (a.k.a. GSE – subsidized rates), or exceeds points and fees thresholds. Note. Manufactured home loans are susceptible to such categorization, given their generally smaller size and lack of a secondary (housing sales) market. Furthermore, owners of small land lease lifestyle communities (a.k.a. manufactured home communities, and before that, ‘mobile home parks’) who finance such home sales are particularly at risk if this change is not effected. Probable result if not passed? Most LLLCommunity owners would likely cease lending to the very citizenry who need such financial help the most, but are least likely to receive it from local housing market lending institutions! Signs of such retrenchment already abound, among property owners/operators who’ve already started leasing their owned homes on – site, rather than risk ‘carrying paper’ – at least for the time being.

In the second instance, this proposed legislation clarifies those selling manufactured homes, NOT otherwise engaged in the business of mortgage origination, will NOT be considered mortgage originators under the federal S.A.F.E. Act (i.e. Safe And Fair Enforcement of Mortgage Licensure). And for land lease lifestyle community owners, who finance but a limited number of manufactured home sales each year, this provision would reinforce any given state’s ability to provide such exemption.

But know what? These two proposed legislative provisions, in HB # 3849 & SB # 3484, otherwise, have little effect on the flawed Business Model now practiced throughout the HUD – Code manufactured housing industry. A weekly blog posting is neither the time or place to dig into such a serious and perennial matter, in any detail. The responsibility for implementing and engaging in such a momentous, and potentially controversial, undertaking – in this veteran industry observer’s opinion – lies with one or another of the two national advocacy bodies ostensibly representing manufactured housing’s business interests in the nation’s capitol. In the meantime, here’s a partial list of the flaws that should be addressed, IF and WHEN a Blue Ribbon Task Force, comprised of businessmen and women from all segments of the industry and realty asset class, convenes:

• Lack of a secondary manufactured housing sales market in every local housing market; one to be characterized, in part and in time, by housing valuations based on market sales comparables; a functioning, realty type, multilisting service; escrow ‘closings’; training and licensing of housing sales personnel; and more…

• Lack of chattel loan programs within practical reach of the manufactured housing industry’s characteristically low – to – moderate income customer base

• Lack of willingness, by manufactured housing marketers, sales persons, and mortgage originators, to sell homes and effect loans, only when mortgage principal, interest, taxes, insurance, AND household utility expenses (a.k.a. PITI & utilities $) are all included within the widely – accepted 30% Housing Expense Factor (‘HEF’) measure of affordable housing! Until such time, we’ll continue to ‘sell & mortgage more house than our typical homebuyer can afford’, effectively saddling them with 40 –50% HEF burdens (i.e. 40 – 50% of their annual income going for housing costs alone!) when they pay their household utility expenses in addition to the 30% HEF that contains just PITI factors.

• Lack of sensitivity, on the part of some land lease lifestyle community owners/operators, to keep rental homesite rent rates in sync with other forms of multifamily rental housing in the same local housing market. There are various ways to do this, including the long known (Since mid – 1970s) and applied 3:1 Rule, where on – site homesite rental rates are approximately 1/3rd that of the largest 3BR2B conventional apartment or townhouse leased in the same local housing market.

This short list merely brushes the rough surface of Business Model issues deserving investigation and an airing, by a Blue Ribbon Task Force. Again, such an investigative and resolution – seeking body might be appointed by one or another of the two national advocacy bodies claiming representation responsibility for one or more function segments comprising the HUD – Code manufactured housing industry and its’ realty component, the land lease lifestyle community asset class.

Better yet, open participation on the Blue Ribbon Task Force to anyone in the MHIndustry & LLLCommunity asset class willing to pay his or her own way, and willing to commit to attend all the task force sessions.

II.

List of 25 Most Influential Persons in Manufactured Housing & the Land Lease Lifestyle Community Asset Class almost complete!

Yep; I’ve been surprised and pleased at the strong and continuing responses to the request first made, at this web site and blog, weeks ago, for input to this first time ever List of 25 Most Influential Persons in Manufactured Housing & the LLLCommunity Asset Class! Where are we today? To date, 23 names are in play. And there’s still time to add more recommendation(s) to the list. Simply phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 to tell me, or FAX it to (317) 346-7158.

The final and very public List of 25 Most Influential Persons in Manufactured Housing & the LLLCommunity Asset Class will be published as part of the 24th annual ALLEN REPORT (a.k.a. ‘Who’s Who Among Land Lease Lifestyle Community Portfolio Owners/operators Throughout North America!’), distributed as a lagniappe in the January 2013 issue of the Allen Letter professional journal. Are you presently a subscriber to this monthly MHIndustry & LLLCommunity newsletter? If not, phone (317) 346-7156 to do so. Subscription is only $134.95/year – and, for the time being, includes the aforementioned ALLEN REPORT at no extra cost.

Speaking of the ALLEN REPORT. The annual letter and questionnaire, to LLLCommunity portfolio owners/operators, soliciting property portfolio size and statistical benchmark information (e.g. occupancy, OER, etc.), is ‘in the mail’, and deadline for returning completed questionnaires to PMN Publishing, is 30 September 2012. These too can be faxed to (317) 346-7158. If you own and or fee manage five or more LLLCommunities, and or 500+ rental homesites (even if in just one LLLCommunity) you’re eligible to be included in this 24 year Who’s Who of our unique realty asset class. Do not be left out! To request a letter and questionnaire, phone (317) 346-7156.

III.

Mark Your Calendar with these Dates Now! The MHIndustry & LLLCommunity Businesses of Today will be Different Tomorrow!

Read this carefully. Starting two weeks ago, a handful of land lease lifestyle community owners in Georgia clearly demonstrated what can be done, in behalf of peers in the manufactured housing industry, to bring education, networking, and more, to their regional housing market! If you missed that watershed event, attended by 142 businessmen and women, read about it in last week’s blog posting at this website (Scroll back into the archives to blog # 210) and visit www.seco12.org for several of the Power Point presentations shared at that symposium. This is where things began to….

This week, 12 – 14 September, in San Diego, CA., 200 land lease lifestyle community owners/operators, and their favorite realty – secured mortgage originators will convene for the most educational seminars and panels (at least 22), intense interpersonal networking (at eight social – meal events), and unparalleled deal – making opportunities available anywhere, anytime, in the manufactured housing industry. This is the 21st consecutive year this segment of the MHIndustry has met; and indirectly, been responsible for eventual founding of MHI’s National Communities Council division, professional property management training and certification (i.e. MHM®), and the research and publication of at least a half dozen HOW TO texts, covering the development, investment in, and management of LLLCommunities. And here too, things will likely continue to…

From 7 – 9 October 2012, the Manufactured Housing Institute (‘MHI’) will host its’ annual meeting in San Antonio, TX. And it’s National Communities Council division, under the new institute executive leadership of Jenny Hodge, VP, will also convene. If you’re a direct member of MHI and or the NCC, you owe it to yourself to be present for the proceedings. For information, contact Bruce Savage, via (703) 558-0666. Who knows, something downright exciting might be in the offing, this time around…

Enjoy November and December with your employees and families, celebrating Fall and the Holiday season! Catch your business planning breath before the new year begins…

Then, as the New Year dawns, so does the 2013 round of manufactured housing shows, beginning with the Louisville MHShow (previously, the Midwest Manufactured Housing Show), from 23 – 25 January in, ‘you guessed it’, Louisville, KY. What many of us LLLCommunity owners/operators are watching for this year, is to see how many HUD – Code home manufacturers ‘have finally gotten the word’ that new home sales = placements in land lease lifestyle communities! The last two years, that wasn’t the case, with hardly a presence of any Community Series Homes or CSH models. Hopefully, this year will be different. Want more info on the Louisville MHShow? Phone _________________

MHI will hold its’ annual Legislative Conference in Arlington, VA., @ 24 – 26 February 2013. Should be interesting to observe, by then, what (if anything) has happened in the interim, between aforesaid annual meeting and this one, nearly five months later. What do you think will be the case? Guess it depends on ‘what’ happens (if anything) during and after the annual meeting in TX. Maybe a Blue Ribbon Task Force? Or how ‘bout a paradigm shift of sorts? In any event, if a direct member of the NCC division, it’ll be a good idea to be present this time around. For event and membership information, phone Jenny Hodge @ (703) 558-0666. Tell her, ‘George sent me!’

27 February 2013. Manufactured Housing Manager® professional property management training and certification class scheduled for Tulsa, OK., the day before the Great Southwest MHShow begins. There’re nearly 1,000 MHM®s designated to date, most of whom own and or operate land lease lifestyle communities throughout the U.S. and Canada. Are YOU one of them? If not, phone (405) 634-5050.

28 February – 3 March. The Great Southwest Manufactured Home Show takes place in Tulsa, OK. This year promises to be ‘bigger and better’ than the one in 2012. And the program is designed to ‘keep MHRetailers and LLLCommunity folk on the show floor buying homes’. BUT, there’ll also be opportunity to learn firsthand, the ‘State of the Manufactured Housing Industry & the Land Lease Lifestyle Community Asset Class’, as well as valuable pointers regarding how to get into and remain ‘in compliance’ with the plethora of federal and state financial regulations now plaguing the industry and property type. For information, phone(405) 634-5050.

A postscript of sorts. Know what a widely known and well – regarded MHIndustry businessman, of many years experience, has to say about the preceding ‘hinted about’ matters this Fall? His comments were received shortly after the suggestion was made, in a recent blog posting at this website, for a new MHInitiative® (formerly, National State of the Asset Class caucuses per 2/27/2008 & 2/27/2009)

“…if MHI doesn’t ‘take the bait’ in October, or indicate solid interest in doing so during their annual Legislative Conference in February, just ‘days before the Great Southwestern MHShow’, then ‘Why Not Do So There?’ Don’t know ‘bout you, but I get so tired of all this posturing, when we should be seizing the initiative and, in so far as possible, (plan and) shape our own collective (business) future!”

So, it isn’t just me out there encouraging our two national advocacy bodies to take ownership and leadership of the future of manufactured housing (Maybe it’s time to come up with another name ‘for what we do’) in the U.S.. And know what? While land lease lifestyle community ‘might be cutting edge terminology for the asset class, there’s still much work to be done, there too, regarding how we do – and don’t do business, e.g. lack of professional property management training and certification of on – site and regional managers, for starters; not to mention the uneven rental homesite rent rates mentioned earlier.

Ah, should make for an interesting Fall meeting season ahead of us. Let’s just hope our salaried and elected leaders don’t let us fall further behind in new home shipments, reputation with consumers, and housing finance.

*****

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

SECO Success, PM Basics, CSH Homes, & Rebranding…

Sunday, September 2nd, 2012

Blog # 210 Copyright 2012 2 September 2012

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

I.

SECO, a Stunning Success for Southeast LLLCommunity Owners!

II.

Land Lease Lifestyle Community Operations Typified by Property Management, Resident Relations, Homesite Rental & Home Sales!

III.

National Advocacy, CSH Model Homes, C.A.S.H., & Rebranding!

***

I.

SECO, a Stunning Success for Southeast LLLCommunity Owners!

A day long symposium for land lease lifestyle community owners/operators, solely planned, hosted, and led by lifestyle community owners/operators! In this veteran industry observer’s recollection, this SECO symposium marks the first time in manufactured housing history, a major U.S. regional educational and networking event, was effected without direct support from any state or national MHIndustry trade and advocacy association or institute – though the former participated; and the latter was invited – but did not show as a sign of support or to recruit new direct members for its’ LLLCommunity council.

Was the 8/29 SECO symposium, in Atlanta, a success? As is oft heard in victorious, bellicose moments of celebration: “Damn straight it was!” How so? Anytime you get 142 land lease lifestyle community owners/operators together for a day of superb education, via skilled presenters and insightful panels, you’ve got a major networking event on your hands – and that’s what happened here. LLLCommunity aficionados, even though this was a Southeast U.S. regional event, came in from CA, the Midwest, FL, and NY, to participate.

What was covered? Lease option & investor financing of home sale transactions; ‘captive finance’ & related regulatory compliance issues; marketing of LLLCommunities ‘for sale’; 21st Mortgage’s exciting C.A.S.H. Program (more about that later); ins & outs of ‘renting’ manufactured homes on – site; selling to the Hispanic market; off grid homes & marketing to ‘boomers’; how to collect 100% of your site rent; and much more! Watch upcoming issues of the Allen Letter professional journal for more information on some of these subjects, as well as this weekly blog posting. Now, aren’t you sorry you didn’t take my advice and attend? Well, guess what, some of these same presenters will be covering similar topics at the upcoming 21st annual Networking Roundtable in San Diego, CA., 12 – 14 September. Are YOU registered yet? 200+/- of your peers already are – and the number is climbing. If you’re a LLLCommunity owner/operators, how can you afford NOT to be present at this once a year educational, networking, and deal – making event? For more information, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. There’s also a brochure, for the event, elsewhere on this website.

So, what else did you miss, by not being present at this historic SECO Symposium event? For me, just being able to pick up product and service literature, from sponsor tables manned by HUD Code home manufacturers, chattel finance lenders, consultant Michael Power, and insurance brokers, was a ‘resource treat’. And seeing Spencer Roane, of Pentagon Properties, honored by the Georgia Manufactured Housing Association, for his PEERSEVERANCE on their behalf, was a privilege. Now, for the time being, let’s hope these Southeast U.S. LLLCommunity owners/operators, again next year – or before, decide to treat their region to yet another superb educational, networking event like this! For more information, contact Chris Nicely via (865) 385-9675 & chrisnicely@gmail.com

II.

Land Lease Lifestyle Community Operations Typified by Property Management, Resident Relations, Homesite Rental & Home Sales!

“OK George Allen, we need you to summarize the basics of land lease lifestyle community operations into a 15 minute talk you’ll share with five different groups of eight LLLCommunity owners/operators, during roundtable presentations following the SECO Symposium luncheon.” That was the assignment; here’s the result:

• Basic Management. Start with 5 – Ms of Management (i.e. manpower, machinery, material, methods & money), ensuring coverage of any management challenge. Use a Problem – solving Procedure to work through various challenges (Ask for free Management Wisdom card when phoning the aforementioned MHIndustry HOTLINE). Keep ‘helps’ in mind, e.g. KISS = ‘Keep It Simple Stupid – or Sweetheart!’ & Tom Peters’ famous MBWA = ‘Management by walking around!’ (How oft are YOU out in your property assessing what needs to be done, then ensuring it gets done?!).

• Resident Relations. Veteran, successful property managers (a.k.a. ‘PM’s) know good Resident Relations = more Resident Referrals = maximum Resident Retention! Gotta confrontation issue? First, everyone sits (i.e. Eliminates ‘fight’ & ‘flight’ options); then, HEAT, where H = hear both sides of the story; E = empathize, where possible, with offending party; A = ‘apologize’ or request same, as appropriate; and T = take Action!

• Marketing Homesites. Start with the 5 – Ps of Marketing, where Product = rental homesites & property amenities; Place = property location re jobs, schools, shopping, recreation; Price = competitive site rent rate per 3:1 Rule, where LLLCommunity site rent is, or should be, 1/3rd of 3BR2B conventional apartment rent; Promotion = via print & online emphasis of USP (Unique Selling Proposition), signage & referrals; People = use SUCCESS Triangle to screen, considering ‘skills/training’ on one side, ‘experience’ on the other side, and all important base, comprised of ‘high motivation’ & ‘right attitude’ for job at hand!

• Marketing Homes. Again, use 5 – Ps of Marketing; here Product = right models for local housing market; Place = rental homesite size, configuration & placement; Price = decide to market new and resale housing Price Points ‘affordable’ or ‘risky’ for the homebuyer/site lessee – use ‘Ah Ha! & Uh Oh! Worksheet’ – free via aforementioned MHIndustry HOTLINE; Promotion = via print & online message, Open House, Guest House, etc.; People = same SUCCESS Triangle, plus ensuring there’s enough sales potential on – site to justify full or part time – manned Sales Center.

Again, some of the handout material distributed during these eight 15 minute talks, is available at no charge to blog floggers (readers). Simply phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and ask for the specific training aids.

III.

National Advocacy, CSH Model Homes, C.A.S.H., & Rebranding!

My final assignment, at this year’s historic SECO Symposium, was to conclude the day with as many positive indicators of HUD – Code manufactured housing industry renewal or rebirth, as possible. Here’re the points shared with this audience of land lease lifestyle community owners/operators:

• National advocacy at the Manufactured Housing Institute. First off, every manufactured housing businessman and woman needs to be supportive of MHI’s efforts to seek passage of HB3849 and SB 3484. Thanks to hard work and advocacy by MHI Treasurer Nathan Smith, PHC, and others, these two similar bills contain components relative to the S.A.F.E. & Dodd – Frank Acts; specifically, certain exclusions for MHRetail salespersons, and some amelioration regarding predatory lending. Also watch for a new paradigm to maybe emerge at the institute’s annual meeting in October. Why no comment on the ‘slight increase’ in new home shipments year to date? Until chattel finance returns (Read paragraph to follow), I don’t see the small YTD up tick in home shipments as any more significant, or lasting, than the so – called (hurricane) Katrina Factor of a few years ago. Perhaps history will prove me wrong; and if so, Good for Us!

• HUD – Code home manufacturers becoming more enlightened on two fronts: home design & ‘affordability’. In the first instance, more home manufacturers are endeavoring to sell more new homes, of Community Series Home (‘CSH’) design, into land lease lifestyle communities, using Business Development Managers (‘BDM’) assigned to this target market. AND, a real surprise, has been the near epiphany, on the part of some manufacturers and MHRetailers, as to how new home Price Points are indeed, either ‘affordable’ OR ‘risky’ for would be home buyers! Why is this such a surprise? Because heretofore – and in most cases continuing today, we – as an industry, sell and mortgage new homes, whereby conventional wisdom’s ‘30% Housing Expense Factor’, or HEF, is comprised solely of loan principal, interest, taxes & insurance or PITI – but NOT including household expenses (e.g. electric, water/sewer & heating fuel). Bottom line: When household expenses are paid outside (i.e. ‘in addition to’) aforesaid 30% HEF, homeowner’s total HEF winds up being a burdensome 40 & 50% (of their annual income), hence ‘risky’! But when the same household expenses are factored ‘into’ said 30% HEF, the homeowner can not buy as much house as before, but now lives ‘affordably’, and is far less likely to abandon their home (an built up equity) at the first sign of economic hardship. Some of us have waited decades for this reality check to move front and center stage! Let’s hope this ‘affordable’ (vs. ‘risky’) approach to selling and mortgaging HUD – Code manufactured homes trickles down to all the new and resale home transactions we effect!

• Independent, third party chattel finance sources returning? Some folk think so; I don’t – at least not where the financing of new and resale home transactions within LLLCommunities is concerned. Here, there’s only one game in town, and to date, that’s 21st Mortgage Company’s C.A.S.H. Program, a cooperative program involving homebuyer, LLLCommunity owner, and the lender. And this comment is not an ‘endorsement’, simply a sobering ‘reality check’. The other three ‘players’ among the Big Four + 1 independent, third party chattel finance lenders? Simply, their required personal credit score and loan underwriting standards are too difficult, if not impossible, for most would – be (manufactured) home buyers today! Proof of this? Attend the 21st annual Networking Roundtable in San Diego, 12 – 14 September and observe how many chattel lenders are present this year, when 200+/- of the largest and most actively selling homes LLLCommunity owners/operators meet to network with their peers and lenders.

• Land lease lifestyle community. We introduced this latest – and hopefully final tweak, to the decades old term describing the realty component of manufactured housing, weeks ago in this weekly blog source. Why the adjustment? Several good reasons. First, the unique, income – producing property type is no longer populated by just ‘mobile homes’ and manufactured homes. Now we routinely site modular homes, ‘park model’ RVs, RVs for a season, and on occasion, site – built homes constructed to appear like HUD – Code manufactured homes. In addition, the ‘lifestyle’ addition is long overdue, as it’s ‘for decades’ been just that, a preferred lifestyle among millions of young marrieds, retirees, and other segments of American society. And finally; there’s a quiet evolution taking place, throughout and within our industry and realty asset class, where Advocacy, Research, and Resources are concerned. That’s about all that should be said about the matter for now, but watch what comes out of MHI’s annual meeting this Fall, and other developments likely reported in this weekly blog posting; again, relative to national Advocacy, industry & asset class Research, and ‘comprehensive Resource servicing’ – in this latter case, where land lease lifestyle communities are concerned.

IV.

There’ll be one more blog posting before the 21st Networking Roundtable begins 12 September at the Hilton San Diego Resort & Spa on Mission Bay, in California. As of the writing of this posting, 1 September 2012, we’re just shy of 200 registrants. That said, and given past experience, we’ll be hosting well more than 200 land lease lifestyle community owners/operators, and a dozen or so of their favorite realty – secured mortgage lenders and brokers, by the time the event begins with Marcus & Millichap’s Buyer’s Symposium at 4PM on the 12th.

If you’re reading this and haven’t registered, do so by this Friday, 7 September. Why? When Carolyn and I leave the office at the end of that workday, we won’t be easily available to you until the Roundtable begins, or back in the office until 17 September. So don’t miss this stellar annual event because you missed us. Phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 this week and register. Your peers in the manufactured housing industry and LLLCommunity asset class want to network with YOU in San Diego, CA. We do too!

George Allen, CPM®Emeritus & MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 46024, Indianapolis, IN. 46247
(317( 346-7156