Birth & Maturation of a HUD Manufactured Housing & LLCommunity Trend.

Blog # 55

Birth & Maturation of a HUD Manufactured Housing & LLCommunity Trend.

“Every (landlease) community owner is dealing with the same issues we face in Georgia: need for low – priced manufactured homes with sex appeal AND financing, to fill vacant rental homesites! Today, HUD Code home manufacturers are going to a lot of trouble to listen to our requests, then designing and building new homes we want, even displaying them at our meetings. Other topics, like professional property management, on – site sales expertise, and sources of funds for home financing, are also near and dear to the hearts of everyone in the manufactured housing business.” (Paraphrased email message from GA. GFA)

Two years ago, the first sentence of the opening paragraph rang true, as landlease (nee manufactured home) community owners/operators ‘added value’ to their unique income – producing properties by selling ‘repo’ and used homes on – site. However, the new reality described in the next sentence received little more than lip service, at the time, from HUD Code home manufacturers enamored by the ‘bigger box = bigger bucks’ business model of the MHIndustry. Today, that has changed in a big way. How?

First, let’s set the stage. There’re approximately 500,000 vacant rental homesites among 50,000+/- landlease communities (‘LLCommunities’) throughout the U.S. The majority of these are smaller, oft singlesection home – sized sites in 10 – 40 year old LLCommunities, and unable to support the ‘bigger box = bigger bucks’ mantra of a decade ago. And, between 1998 and 2008, HUD Code housing shipments plummeted from 372,843 to 81,889! What’s happened to change that mantra?

Nearly two years ago, on February 27, 2008, 100 LLCommunity owners and operators, from throughout the U.S., convened in Tampa, FL., for their first National State of the Asset Class caucus. One of Five Action Areas identified at that caucus of peers, was the mandate to ‘Get HUD Code home manufacturers and LLCommunity folk talking to each other!’ Well, it took a year, but we finally reconvened at the RV/MH Heritage Foundation Hall of Fame, Museum & Library facility….

On February 27, 2009, in Elkhart, IN., 100 HUD Code home manufacturer execs and LLCommunity owners/operators gathered for an Historic SUMMIT Meeting. What occurred? Open communication between these two major segments of the MHIndustry, and the naming of nearly three dozen Business Development Managers (‘BDM’) by those manufacturers present, with the mandate to ‘Increase their firms’ new home sale market share within and throughout this real estate asset class!’ The trend is born!

On September 10 & 11, 2009, in Chicago, IL., 200 portfolio owners/operators of LLCommunities, again from throughout the U.S., gathered for their 18th annual International Networking Roundtable (‘INR’). Besides spending time in seminars learning how to better market and sell new and resale homes on – site, everyone toured and inspected three new HUD code homes on display! These new single and multisection ‘community series’ homes were supplied by Clayton Homes, Harmony (Fairmont) Homes, and Hi – Tech Housing. And new homes were ordered!

On December 16th, in Forsythe, GA., at least five HUD Code home manufacturers will display new ‘community series’ homes in the hotel parking lot where GMHA is hosting Symposium II. This will be at least the sixth joint HUD Code manufacturer & LLCommunity event conducted during 2008, with others in IN, IL, OH & GA! During symposiums, LLCommunity folk learn ‘How to Market, Sell & Self – finance Homes On – site!’ and HUD Code home manufacturers get to showcase their new lines of community series’ homes! FYI; symposiums are being planned in NY, TX and elsewhere. Encourage your state MHAssociation to participate in the Symposium & Showcased ‘community series’ Homes trend’ during 2010!

There’s an interesting, evolving sidebar regarding this Symposium & Showcased ‘community series’ Homes trend’. MHIndustry veterans know regional (and some state) manufactured housing shows have long been a primary means of introducing new home designs and features to mostly manufactured housing retailers (nee dealers) and developers. These mega – events were very ‘high cost’ (transportation, setup, space rental, etc.) for home manufacturers, and the treasuries of sponsoring MHAssociations oft shared (large) profits post – show. Today, that has changed. With new home shipments down 450 percent, between 1998 and 2008, manufacturers cannot afford these high – priced venues, and appreciate opportunities to setup and showcase ‘community series’ product near their factories, to the most likely buyers in the housing market today – LLCommunity owners/operators.

So maybe, until across – the – board housing demand and national prosperity returns, this contemporary Symposium & Showcased ‘community series’ Homes trend, comprised of LLCommunity owners/operators and HUD Code home manufacturers working together to fill approximately 500,000 vacant rental homesites in 50,000+/- properties nationwide, is ‘the best and only way to go!’

End Note. As always, I appreciate your feedback on every Blog I pen in behalf of the MHIndustry & LLCommunity asset class. Your reaction and comments to this one?

*****

George Allen, Realtor®, CPM®, MHM®
Box # 47024
Indianapolis, IN. 46247
(317)346-7156

Leave a Reply