Archive for the ‘Uncategorized’ Category

31st ALLEN REPORT, ‘Green Jacket Policy’, & Meet PES!

Thursday, October 17th, 2019

October 2019; Copyright 20190; www.educatemhc.com

Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog is the online national advocate, official ombudsman, asset class historian, researcher, education resource & communication media for land lease communities in North America!

To input this blog 7/or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email: gfa7156@aol.cm & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U!’ Goal: promote HUD-Code manufactured housing & land lease communities as U.S. source of affordable attainable housing! Call for next MHM class info.

INTRODUCTION: Three pretty disparate topics this time around. First; your last opportunity to be written into the 31st annual ALLEN REPORT, due for distribution in early 2020. Second; look to see more ‘green jackets’, worn by RV/MH Hall of Fame inductees, at state and national MH & RV events. And third; a little known but valuable and timely service available to land lease community owners/operators intent on improving their property holdings’ occupancy, profitability, resident relations, value, and other functions.

I.

Will You be in the 31st ALLEN REPORT?

If you, as a sole proprietor, or your partnership, company, or REIT, owns and or fee-manages five or more land lease communities, or 500+ rental homesites in one community, you’re eligible to be listed in the 31st annual ALLEN REPORT as one of the 500 largest property portfolio firms in North America.

Here’s the drill. Request an ALLEN REPORT questionnaire from EducateMHC by phoning the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, or request it via email from gfa7156@aol.com Complete the questionnaire right away and FAX it to (317) 346-7158 or email it to the same address just cited. We already have many completed questionnaires on hand, as a result of the mailing effected during September. But there’s still room for YOU!

During the month of November we’ll compile the information reported in the completed questionnaires, and begin penning the annual ALLEN REPORT. As you likely know, or maybe don’t, the annual ALLEN REPORT – for the past 30 years, has been and continues to be, the sole compendium of pertinent benchmark statistics (e.g. occupancy, OERs, average site rents & much more), as well as emerging trends, pertaining to land lease communities (i.e. and before that, manufactured home communities & ‘mobile home parks’).

During December we’ll finalize the 31st annual ALLEN REPORT, for printing and distribution to those who’ve paid for it. How so? At present, that means subscribing to the Allen CONFIDENTIAL! business newsletter (i.e. the ALLEN REPORT is but one of a dozen Resource Documents distributed monthly, with that newsletter, throughout the calendar year). To learn more, visit www.educatemhc.com or phone Erin via (317) 738-3434.

You might also be interested to know; the ALLEN REPORT is archived and will, upon my eventual retirement, become part of the libraries at the RV/MH Hall of Fame in Elkhart, IN., and the Library of Congress in Washington, DC. So, take steps now to ensure your property portfolio’s continuing legacy into the future. Questions? Phone me at (317) 346-7156. GFA

II.

RV/MH Hall of Fame’s Green Jacket Policy

What follows here pertains to a small, but growing, number of men and women in the manufactured housing industry and land lease community ownership/operations. It’s the recently suggested ‘when and where all RV/MH Hall of Fame inductees should wear their distinctive green jackets.’

Green sports jackets have long been integral to the formal recognition of individuals inducted into the prestigious RV/MH Hall of Fame in Elkhart, IN. And heretofore, green jackets have rarely been worn and seen at other than at one RV/MH Hall of Fame event, the annual Induction Banquet, during early August, at the facility.

Here’re the appropriate occasions when the RV/MH Hall of Fame green jackets may be worn:

• At the annual RV/MH Hall of Fame Induction Banquet

• At all state and national RV or MH annual industry functions

We’ve long encouraged RV/MH Hall of Fame inductees to wear their green jacket at the annual Networking Roundtable. Now it’s officially appropriate to wear it at MHI’s annual meeting, the manufactured housing congress, SECO Symposiums, Rent Manager’s annual soiree, as well as various state and provincial business and social functions.

Have you been in the manufactured housing (&/or recreational vehicle) business for 25 or more years, and know three individuals who’ll pen letters of recommendation describing your contributions to the industry and or realty asset class? Then visit the RV/MH Hall of Fame online, and download the application and instructions there, to be considered for induction. And if you want to recommend someone for induction, follow the same procedure. Ten individuals are inducted every August, five from MH and five from RV industries.

III.

Professional Community Evaluation (‘PCE’) Service Available!

EducateMHC announces its’ Professional Community Evaluation (‘PCE’) service is available for land lease communities nationwide.

During past decades, Mystery Shopping services have been offered by various firms, but no one ever ‘went the extra mile’ to observe, evaluate, and report on entire land lease community operations, to include:

• Telephone sales and leasing performance evaluation via grading and reporting

• On-site sales and leasing performance evaluation via grading and reporting.

• Curb appeal outside, and throughout the targeted land lease community, documented with photographs

• Comparison of operating statements with industry norms, highlighting differences, and suggestions for correction or improvement

• Documentation and evaluation of print and online marketing in light of product, place, price, promotion, people, and process

What does PCE service cost? Each assignment is quoted on an individual basis, considering size and location of the property, scope of evaluation services desired, number of properties to be evaluated, and more. PCE services are appropriate for new acquisitions, as well as mature property and portfolio holdings.

For more information, contact Erin Smith at EducateMHC via (317) 697-1717

There’s Only ONe HUD-Code HOusing Shipment # Each Month (&) ‘State of MHIndustry & LLCommunities!’

Friday, October 11th, 2019

October 2019; Copyright 2019; www.educatemhc.com

Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog is the online national advocate, official ombudsman, asset class historian, researcher, education resource & communication media for land lease communities in North America!

To input this blog &/or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email: gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U!’ Goal: promote HUD-Code manufactured housing & land lease communities as U.S. source of affordable attainable housing! Call for next MHM class!

INTRODUCTION: Time for a change! With new leaders coming on board at the Manufactured Housing Institute (‘MHI’), now is the ideal time to begin reporting monthly new HUD-Code housing shipments in the same manner as IBTS, MHARR, HUD, & EducateMHC! This reporting discrepancy was first reported, in the Allen Letter, during Summer of 2015. Let’s start year 2020 off right! And ‘State of the MHIndustry & LLCommunity Asset Class’? I share this message a dozen times each year. Suggest your state MHAssociation invite me to share it with you.

I.

Rely on EducateMHC’s Monthly ‘#s & $s’ Report Documenting New HUD-Code Housing Shipments!

Every month, the Institute for Building Technology & Safety (‘IBTS’), HUD’s contractor for researching and reporting manufactured housing shipments, distributes a statistical report to subscribers. For example, on or about 1 October, the IBTS reported 8,646 new HUD-Code singlesection and multisection homes shipped nationwide during the month of August 2019.

HUD reports the same total: 8,646
MHARR reports the same total: 8,646
NAMHCO reports the same total: 8,646
EducateMHC reports the same total: 8,646

MHI reports 8,631 new HUD-Code homes shipped

What’s wrong – and ‘why’, with this statistical reporting picture? If five out of six reporting entities agree on the monthly shipment volume, ‘why’ the outlier’s different total number?

Has to do with the ‘accounting or not’ of DESTINATION PENDING (‘DP’) units – new HUD-Code homes not scheduled for delivery, to any particular destination, at the time of reporting #s to the IBTS. MHI, for decades, has reduced IBTS’ monthly total (e.g. 8,646 units during August) by that month’s number of DP units (e.g. -24), then added back the number of DP units from the previous month (e.g. +9 from July), to arrive at its’ own reported volume of new HUD-Code homes shipped = 8,631. Rationale for this process? Likely, an attempt to account for eventual distribution of all DESTINATION PENDING units. The ‘problem’ with that thinking however, is IBTS has long known some DP units will almost never be distributed, i.e. unit accounting when a plant closes oft exposes DP units, months and years after their fabrication.

So, what’s the logical resolution to this reporting dilemma that only adds to the consternation, by federal legislators and regulators, over how one industry – the manufactured housing industry, appears to be incapable of agreeing on just how many new HUD-Code homes are shipped monthly throughout the U.S.? The answer, in this industry observer’s opinion, is for all six reporting entities to agree on monthly shipment volume, beginning with IBTS published totals.

So, where can one obtain a copy of the EducateMHC Monthly ‘#s & $s’ Report – showing how all six reporting entities report each month’s shipment volume? Visit www.educatemhc.com

II.

State of the MHIndustry & LLCommunities

This past week saw the 10th anniversary celebration of the SECO Symposium. Held at the Airport Hilton in Atlanta, GA., it was attended by nearly 500 manufactured housing and land lease community businessmen and women. The Big Three C: HUD-Code manufactured housing firms (Clayton Homes, Skyline Champion, & CAVCO Industries), and a hefty number of small to mid-sized land lease community owners/operators, many of whom are ‘new to the business’, characterized the group at large. The only national manufactured housing/land lease community advocate present was the National Association of Manufactured Housing Community Owners (‘NAMHCO’) – lobbyist for the real estate asset class in Washington, D.C.

Also interesting to note that all MH trade publications of note were present at SECO:
• MHInsider magazine, a product of MHVillage & DATACOMP in Michigan
• Manufactured Housing Review, a quarterly online publication
• Allen Letter and the Allen CONFIDENTIAL! Published by at www.educatemhc.com
As has been the case in years past, I was asked to deliver the ‘State of the Manufactured Housing & Land Lease Community Real Estate Asset Class’ address. But this time around, instead of focusing entirely on statistics and emerging trends, I shared highlights of the past year, in terms of performance and pressing concerns. Here goes:

• 96,555 new HUD-Code homes were shipped during year 2018. According to the U.S. Census Bureau, they were valued (retail) at $6.4billion, or $66,200/manufactured home (close to the $70,000/MH figure oft quoted within the MHIndustry). Production (wholesale) value of the year’s shipments, based on MHI’s research & 2013 baseline, pencils out to be $4.2 billion or $43,126/MH, leaving a $2.2 billion margin or 23,000 per new manufactured home. It’s time for an update to the year 2013 baseline $ factor.

• How many new HUD-Code homes will be shipped by year end 2019? Time will certainly tell, but it’ll likely NOT eclipse the 100,000 ‘goal’ of the past two years. Why? Continuing lack of reasonable access to chattel capital for new HUD-Code home sales transactions on-site in land lease communities! Here we’ve moved up from only 24% of new HUD-Code homes shipped into LLCommunities in 2009, to more than 40% by year end 2015 – and now likely stalled.

• During year 2019 we celebrated the 30th anniversary release of the ALLEN REPORT (a.k.a. ‘Who’s Who Among Land Lease Community Portfolio Owners/operators Throughout North America!’). Now, during October and November we’re researching the data needed for the 31st ALLEN REPORT, scheduled for distribution during January 2020. If you’re a property portfolio owner/operator and have not yet submitted the completed questionnaire used to compile said report, please let me know via gfa7156@aol.com and I’ll send you another blank one. And if you’ve not yet been listed among the ‘known 500 portfolio owners/operators’ – who own and or fee manage five or more communities, and or 500+ rental homesites – whether MH & RV or purely MH, get listed now! Also phone (317) 346-7156.

• Beware national rent control legislation making its’ way through Congress! It’s written to include anyone owning/operating two or more land lease communities. How to fight this? Belong to and support your state manufactured housing association, and encourage staff to keep you informed, and how you can help fight this national plague! How to know if your local housing market is guilty of bringing unwanted landlord/tenant legislation to our doorstep? Use the traditional 3:1 ratio. Market survey the 3BR2B conventional apartments in your area (e.g. $900/month), then divide by ‘3’ to estimate what land lease community rental homesite rent might be (e.g. $300/month). If site rates in your local housing market are at or above a 2:1 ratio (e.g. $450+/month), then it’s possible these rents are part of the focus creating this challenge.

And there was more, but you have the gist of the presentation here.

Be Aware & Beware of ‘Place to Prosper’ Act (&) GASLIGHTING

Friday, October 4th, 2019

October 2019; Copyright 2019; www.educatemhc.com

Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog is sole online national advocate, official ombudsman, asset class historian, researcher, PM education resource & communication media for land lease communities in North America!

To input this blog &/or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email gfa7156@aol.com & visit www.educatemhc.com

Moto: ‘U Support US & WE Serve U! Goal: promote HUD-Code manufactured housing & land lease communities as U.S. source of affordable attainable housing! Call for next MHM class.

INTRODUCTION: As an industry, we were ‘asleep at the switch’ when the S.A.F.E. Act was legislated a decade ago. Let’s not be guilty of similar inattention and inaction as national rent control makes its’ way through the halls of Congress! MHI/NCC. When will your ‘research’ translate into action? And, wouldn’t it be helpful to ‘really know’ the $ details about ‘home & land’ finance of manufactured homes, as well as for ‘home only’ loans? Perhaps 21st Mortgage Company will ‘take the lead’ here, and report $ facts and trends relative to the latter type MH lending. Finally; GASLIGHTING. This has been a trade news blemish awaiting attention for a while now. Manufactured housing and land lease community aficionados owe it to themselves, their employees, and customers, to rely solely on reliable trade news reporting of facts and trends, not salacious op/ed posturing by an outlier!

I.

Be Aware of, & Beware, the ‘Place to Prosper’ Act!

“The Place to Prosper Act calls for a cap of 3 percent or the Consumer Price Index (‘CPI’), whichever is greater, for housing markets nationwide. (The rule would apply specifically to landlords with five or more residential properties or TWO OR MORE MANUFACTURED HOUSING PARKS)…” (Emphasis added. GFA) Per AOC, Bernie Sanders, et. al. Will let you know more when we hear and learn more!

II.

INTERESTING MH $$$ NEWS – Revisited

CFPB’s recently-released HMDA Summary description of 99,200 ‘home & land’ mortgages and 51,000 ‘home only’ loans, according to some freelance manufactured housing consultants, understates the real total, given that an unspecified number of independent third party lenders allegedly don’t report this $ data to the CFPB. However, knowing the manufactured housing industry shipped 96,555 new HUD-Code homes during year 2018, the 150,200 total loans underwritten during that same period of time, appears logical when including resale homes in the mix.

III.

GASLIGHTING

…is a psychological tactic, in writing and speaking, used to (attempt to) gain power over someone – or a group, causing them question their perception, reality, sanity, even memory, of how they believe things are and should be. And I suppose, at times, all of us are guilty of this practice, to some degree, as we deign to influence individuals we interact with during business and social intercourse. However, when I (sometimes) read a particular manufactured housing trade publication (Not MHInsider or Manufactured Housing Review), it appears their op/ed penmen go out of their way to gaslight a particular national advocacy entity – one they should be supporting, and various targeted individuals. Point? Be discerning as to what you read, and who you listen to, in today’s fractious world of politics, business, and certainly, manufactured housing. In truth, you’re better off not reading some news tripe, but concentrate on good and uplifting news about the industry and realty asset class we embrace as businessmen and women.

Is there an acid test to discern gaslighting masquerading as journalism? Yes, three principles of journalism posed as questions:

• Is what you read or hear, the reporting of facts – or just the source’s opinion?

• Check writer/speaker’s resources – or is it past commentary used out of context?

• Is read or spoken word easily understood, by dint of plain style communication?

So, next time you read any of the nearly half dozen manufactured housing trade publications afoot these days, ask those three questions as you read, to learn which ones are worth the time and effort, going forward, and which is not. It’s as simple as that. So, ‘Just Do It!’

***

Interesting MH $$$ NEWS (&) New Face of MHI in Year 2020

Thursday, September 26th, 2019

September 2019; Copyright 2019; www.educatemhc.com

Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog is sole online national advocate, official ombudsman, asset class historian, research reporter, PM education resource & communication media for land lease communities.

To input this blog &/or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877)MFD-HSNG or 633-4764. Also email gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U! Goal: promote HUD-Code manufactured housing & land lease communities as U.S. source of affordable attainable housing! Next MHM class 10/7/2019

INTRODUCTION: Yes, we are in the midst of the Fall meeting season. So far, the 28th Networking Roundtable and MHI’s annual meeting are behind us. Yet to come? The rapidly growing and highly popular SECO Conference in Atlanta, GA., @ 8-10 October 2019. Will I see you there? Sure hope so. This is the only regional cum national venue, attracting 500+/- attendees, that’s ‘planned & hosted BY land lease community owners/operators FOR land lease community owners/operators’! For more information, visit 2019 SECO Conference

I.

INTERESTING MH $$$ NEWS

CFPB’s recently-released HMDA Summary tells us: During year 2018, 99,200 manufactured housing loans were secured by ‘home & land’, while 51,000 chattel loans were secured by ‘home only’. And median interest rate for chattel loans was 8.29%, while median rate for non-chattel loans was 5.125%. Also during this time frame, 39.47% of manufactured housing owners were younger than 25 years, and 25.47% were older than 75 years. This is the first HMDA file to distinguish between chattel and real estate-secured manufactured housing loans. Section 6.8, beginning on page # 63, of said report, covers these new data points and more.

Visit: https://files.consumerfinance.gov/f/documents/cfpb-new-revised-data-p;oints-inhmda-report-pdf

II.

MHI’s Annual Meeting in Savannah, GA

Preview: ‘Good-bye’ leaders Stegmayer & Jennison, and ‘Hello’ Berkshire-Hathaway; no name yet for ‘new type’ manufactured homes; research aims to head off national rent control; &, ‘affluence gerrymandering’ alive & well at this national MH venue.

Manufactured housing says affectionate ‘good-byes’ to elected leader, Joe Stegmayer, as his second term as MHI chairman ends; and, salaried MHI exec Richard Jennison, as he retires at year end. No named successor to Dick Jennison at this time.

Three Berkshire-Hathaway-related corporate executives to lead new Manufactured Housing Institute (‘MHI’) board in year 2020: Tom Hodges, esquire, of Clayton Homes as board chairman; Eric Hamilton of Vanderbilt Mortgage Finance as treasurer, and Tim Williams of 21st Mortgage as board member. Leo Poggione of Craftsman Homes, and recent RV/MH Hall of Fame inductee, becomes vice chairman of the board, and Patrick Waite of Equity Lifestyle Properties (‘ELS, Inc.’ – world’s largest owner/operator of land lease communities) will serve as board secretary. Curious. Was there a formal nominating committee this time around?

Good News/Bad News. Bad News, is the ‘new type’ manufactured home, after several years in production and distribution, continues to be formally unnamed. The Good News, is the ‘next gen’, choice, millennial manufactured housing design is close to formal naming by MHI manufacturer members. Let’s hope they ‘get it right’ the first time around! In today’s world of social and political sensitivity that might be more difficult than expected.

National Communities Council (‘NCC’) division is well aware of negative PR and social, business, political turmoil foisted on the land lease community realty asset class, by private equity firms acquiring such properties, and portfolios thereof, then – in too many instances – ‘jacking’ rental homesite rates to generate income needed to satisfy high debt service (mortgage) and investor ROI (‘returns on & of investment’) demands. Their answer? To research the matter during months ahead, then decide if and how to take action.

I’ve been complaining about affluence gerrymandering (‘National trade advocacy entities patronizing high-priced resort venues, discouraging small-size business owners/operators from participating on a level playing field with larger firms intent on dominating a particular industry’), relative to manufactured housing, for decades! Still no change. In this instance, we have a national advocate boasting more than 600 members (some say 800), with only 135 showing up for this annual meeting. Might be because the hotel room rate was $219/night; guest services @ $25 (shuttle to airport); mandatory resort service fee of $28.25 (For what?); and array of state & city taxes & occupancy fees of $35.97; all for a grand total of $308.22/day (less the $25 shuttle fee). How many more would likely attend if the daily total was closer to $208.22 or less? Just saying….

Did You Know? (&) Finally, a Campaign! (&) Clayton to Dominate MHI?

Thursday, September 19th, 2019

September 2019; Copyright 2019; www.educatemhc.com

Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog is sole online national advocate, official ombudsman, asset class historian, research reporter, PM education resource & communication media for all land lease communities.

To input this blog &/or affiliate with EducateMHC, telephone Official MHindustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U! Goal: promote HUD-Code manufactured housing & land lease communities as U.S. source of affordable attainable housing! Next MHM class 10/7/19

INTRODUCTION: Part I, a potpourri of interesting MHIndustry information. Part II, preliminary thoughts pursuant to planning, financing, and effecting a national advertising and image improvement campaign, via the land lease community segment of the manufactured housing industry. All that’s needed now is a LEADDER. Manufacturers. You paying attention? And Part III. One might say I know ‘just enough’ to be dangerous, where this succession matter is concerned. My hope is, ‘voting members’ of MHI, which I am not, are paying attention to what’s being done (to them), where salaried and volunteer leadership are concerned.

I.

Did You Know?

The U.S. Median Household Income during Year 2018, was $63,179. How ‘bout your county? Visit www.Zipwho.com And, for a copy of ‘Ah Ha! & Uh Oh! Worksheet for calculating new & resale housing values based on Area Median Income (‘AMI’), request it via gfa7156@aol.com

“Treasury Secretary Steven Mnuchin told a Senate committee on Tuesday (10/10/19) he wants to reach an agreement quickly with the regulator (Affordable Housing Finance Agency or AHFA) of Fannie Mae & Freddie Mac, to allow the companies to keep their profits to rebuild capital – a first step in privatizing the nation’s largest sources of mortgage financing.” Quoted from the DAILY; source for mortgage & housing industry news.

According to HUD Secretary Carson, “HUD…elevate the Office of Manufactured Housing Programs within HUD and appoint a Deputy Assistant Secretary to lead it.” Something that’s been a (too) longtime coming!

The 28th Networking Roundtable was a complete success, from beginning to end. Highlights? Stirring keynote presentation by Congressman Trey Hollingsworth, who exhibited a deep knowledge of manufactured housing and land lease communities – and the role they should be filling relative to this nation’s affordable housing crisis. Just as illuminating, were very open ‘Here’s how we did it’ presentations by portfolio owners/operators Mike Callaghan (Four Leaf Properties), Jeff Davidson (Meritus Corporation), and Julio Jaramillo of Evergreen Communities)
During the wrap-up session at this year’s Networking Roundtable, a dozen concerned businessmen and women spent 1 ½ hours ‘talking through’ the continuing need for a nationwide marketing and image improvement program for the manufactured housing industry and or the land lease community real estate asset class.*1 A summary of said proceedings, along with questions begging answers, comprise Part II of this blog. This group pretty much decided to focus their attention on the property type rather than entire industry.

End Note.
1. Such initiatives have started and failed over the years. A decade ago, at a Networking Roundtable in Mystic, CT., Kevin Clayton of Clayton Homes was encouraged by community owners – willing to donate funds, to take a similar idea to an MHI annual meeting occurring in TX during the next few weeks. When the HUD-Code housing manufacturers caucused in private, they nixed the idea, concerned that non-member firms would benefit from their, and community owners/operators, largesse funding such a marketing and image-improvement campaign.

II.

Community & Lifestyle Campaign

What follows are six foci areas – and there could well be others, for consideration before launching any major campaign to market and improve image of communities & lifestyle:

1. What is nexus of the campaign? The land lease community (or whatever it’s to be labeled) and or the multifamily rental community lifestyle, where everyone lives in and cares for their own home.

2. The scope of this campaign? National or regional, with appropriate characteristics/ foci

3. The cost of such a campaign? To be funded by communities.

4. What are unique selling propositions (‘USP’) associated with communities and or lifestyle, and where/how to best get this message out effectively? What platforms?

5. Who to lead this major effort? A national MH advocacy entity, or a capable, experienced, motivated independent third party.

6. Timeline, budget, performance benchmarks along the way

There was much more discussed, than ‘just this’, at the aforementioned informal meeting.

If you agree this is a serious enough matter to be pursued, let me know ASAP, via gfa7156@aol.com. There are individuals waiting to get started on such a campaign. That’s the ‘first acid test’. Another? MHI’s annual meeting, including its’ National Communities Council division occurs next week (22-24 September) in Savannah, GA. Whether this matter is brought up (not by me) and seriously considered, during the NCC meeting, will be a ‘second acid test’!

Whether this community campaign idea flies or dies, will likely be decided by early October.

So, will manufactured housing history, once again, repeat itself – to no end; or, will our salaried and elected national leaders finally recognize the need, catch this vision, and make plans to nationally/regionally promote manufactured housing &/or land lease communities & lifestyle during year 2020 and beyond? It will be interesting and ‘telling’ to watch and see!

III.

MHI Annual Meeting 2019

Smart Succession or Leadership Swamp?

Was there a nominating committee in place, recommending individuals to fill vacancies on MHI’s executive committee, at the annual meeting next week (23 & 24 September)?

Will there be balance among board members, relative to all ‘Big Three C’ firms (i.e. Clayton Homes, Skyline-Champion, & Cavco Industries), represented on the new board?

Will the new executive director of MHI be selected from within present day staff, or from candidates recruited outside the Washington beltway, maybe even outside the industry?

These are a few of the questions coming across my PC in the form of emails this past week. Certainly not much information forthcoming from MHI about any of these matters. That’s ‘lack of communication’ with members, from my perspective.

Best Kept Secrets…Calm Before the Storm (&) Here Comes Preemption Again!

Thursday, September 12th, 2019

2019; Copyright 2019; www.educatemhc.com

Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog is sole online national advocate, official ombudsman, asset class historian, research reporter, PM education resource & communication media for all land lease communities!

To input this blog &/or affiliate with EducateMHC, telephone Official MHindustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email: gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U! Goal: promote HUD-Code manufactured housing & land lease communities as U.S. source of affordable attainable housing! Next MHM class @ 9/11/19

INTRODUCTION: Consider reading this week’s blog posting in reverse order, i.e. Part III, then II, and finally, # I. Why? Because Part III talks of important ‘breaking affordable housing news’ on the national level! Part II is your ‘heads up’ WARNING of MH political and leadership maneuverings in Washington, DC. Part I is important in its’ own right: Trade secrets ready for Change, Embrace, & Practice! Next week? Have already started it, describing the Housing Finance Reform Plan, relative to GSEs, released 5 September 2019.

I.

Best Kept Secrets of Manufactured Housing

As one frequently called upon to introduce individuals and firms to the manufactured housing industry and its’ realty segment, land lease communities, there are perennial anomalies (‘something abnormal or irregular’) ever- clouding our otherwise good affordable housing presence! These are two trade secrets that besmirch us, and two underutilized tools of the trade.

1. Secret sin. Manufactured housing industry reports monthly shipments of new HUD-Code homes as two different totals. For example, last week MHI reported 7,131 new homes shipped during July, while MHARR, HUD, NAMHCO & EducateMHC each reported 7,135 units. The source of this data, the Institute for Building Technology & Safety (‘IBTS’), reported to all subscribers, 7,135 new HUD-Code homes had been shipped during July. So, how the difference? MHI takes IBTS’ official tally of 7,135 units, and subtracts 9 Destination Pending (‘DP’) units from it, then adds back 5 DP units deducted from IBTS’ June tally. Did you follow that? Meanwhile, MHARR, HUD, NAMHCO & EducateMHC make no adjustments to IBTS published data. And the secret sin continues. WHY?

2. Secret sin. Manufactured housing industry, in my opinion and in many instances, routinely sets home-buying customers up for potential failure (loan default)! The most widely used of six measures of affordable housing, the Housing Expense Factor (‘HEF’), suggests no more than 30 percent of one’s annual gross income (‘AGI’) be used to pay for total housing costs. With a home sited on a scattered building site conveyed fee simple, this means 30% HEF should include PITI (loan principal, interest, taxes, insurance) and household (utility) expenses. With a home sited in a land lease community the 30% HEF should include PITI, household expenses, and homesite rent. But that’s NOT the way it often works in manufactured housing circles. Rather, the 30% HEF, in both instances, includes PITI, and in the case of the land lease community, site rent. However, household expenses are rarely included! This means a prospective homebuyer, and homeowner/site lessee, can afford to ‘buy more house’ with the 30% HEF allowance, taking on more risk, as household expenses must to be paid ‘in addition to’ the 30% HEF set aside for PITI (& site rent). Consequence? Homeowner winds up paying between 30 & 40% or more HEF for the life of the home loan. So, the secret sin continues. WHY? In this instance, borrower & lender reasons are easy to see….

3. Not a secret sin, but secret nonetheless. How many of you, reading these lines, have heard a ‘State of the Manufactured Housing Industry’ presentation? Most of us have. But how many of you know there’s a more comprehensive alternative ‘State of the MHIndustry’ presentation that includes statistics and trends characteristic of 50,000 land lease communities spread across this country? The ‘secret’ is well enough known, for this ‘more comprehensive lecture’ to be shared annually at the SECO Conference in Atlanta, sometimes at the annual Networking Roundtable, and almost monthly at one or another state MH association gathering. But never has sit been featured at any MHI or MHARR-hosted national event! WHY? Guess you’ll have to ask them. My guess is, they’re manufacturer-dominated organizations, and land lease communities are little more than a tolerated adjunct.

4. New Rule of 72. This unique mathematical formula has been around for awhile, but is still new – a secret? – to many. What is it? Well, first, understand the original Rule of 72. ‘How long will it take to double one’s income at a set ROI (return on investment)’? E.g. ’72 divided by, say, 20% (or .2) ROI = 3.6 years’. Now, the New Rule of 72. ‘How to estimate the capitalized income value of an ‘average’ land lease community, at 100% and 80% occupancy levels?’ E.g. ’72 X 200 occupied sites X $200/month site rent = $2,880,000.’ & ’72 X 160 occupied sites X $200/month site rent = $2,304,000. These are identical values obtained when using the IRV investment formula, where V = I divided by R or Value = NOI divided by cap rate, e.g. 200 sites X $200 X 12 months X .6 (reciprocal value of 40% industry average Operating Expense Ratio) divided by .1 (10% cap rate for an ‘average’ LLCommunity) = $2,880,000. A useful tool, but only for ‘average’ land lease communities, i.e. using 10 percent income capitalization or ‘cap’ rate.

Know what? There are even more ‘secrets’ not described here. Perhaps in a future blog posting.

II.

A Calm Before The Storm, or Worse?

In the words of Bob Dylan, “The times they are a-changin.” During 2017 and 2018, the Manufactured Housing Association for Regulatory Reform (‘MHARR’) encouraged anyone who’d listen, or read their press releases, to form a new national advocacy entity to represent ALL non-manufacturing segments of the manufactured housing industry – even though Manufactured Housing Institute (‘MHI’) claimed to be doing so at the time. Well, by year end 2018, the National Association of Manufactured Housing Community Owners (‘NAMHCO’), was formed in Arizona, with tacit support from Nevada and encouragement from many property owners around the U.S. And in early 2019, the five year old Community Owners (7 Part) Business Alliance (‘COBA7’) was reconfigured as EducateMHC, to be the primary, if not only, for-profit source for all land lease community-focused products (i.e. newsletters, books, forms) and services (e.g. professional property management training & certification, property Performance Evaluations and more).

And now, as year 2020 looms on the industry and real estate asset class’ business horizon, there’s growing concern and rumors about changes in top leadership at one of the forenamed national manufactured housing advocacy entities. At this point in time, details are sketchy, as comments fly and individuals jockey to fill these leadership positions. So, for the time being, the only things penned here are these thoughts:

• Since the manufactured housing industry, and two of its’ national advocacy entities, are dominated financially and leadership-wise by HUD-Code housing manufacturers; and in one case, the three firms controlling 80+/-% of national market (housing shipment) share, is there valid concern said organization might become dominated by one, or another, of the Big Three C firms?*1 Especially, if thru some turn of events, one or another or both other mega-firms no longer sit on the entity’s board of directors?

• It’s well known one national advocacy entity will be in need of a new salaried top executive by year end. What isn’t known, outside the official search committee, is whether this search will extend beyond MHI staff, to the industry at large, or not. There are pros & cons to hiring within either sphere, as well as value of searching for new leadership talent experience, and motivation untainted by past interpersonal relationships. Another concern is whether the new ‘leader’ will continue past practice of parroting board directives, or be strong enough lead in his or her own right?

Enjoy the relative organizational calm in place right now. But know there’re already maneuverings, behind the Washington, DC scene, to fill board seats as well as top salaried and volunteer leadership positions. If you have particular insights into this matter, and are willing to share them with me, in confidence or not, do so via gfa7156@aol.com or phone, the Official MHIndustry hotline: (:877) MFD-HSNG or 633-4764.
End Note: 1. Big Three C firms: Clayton Homes, Skyline-Champion, & Cavco Industries

IV.

Preemption, again?

In the August 2019 report titled ‘Eliminating Exclusionary Land Use Regulations Should be the Civil Rights Issue of Our Time’, author Michael A. Stegman, on pages # 11 & 12, includes this bold, and surely controversial, solution to solving the title issue:

“A state’s failure to (remove local barriers to affordable housing), or make an inadequate effort (to do so), would result in…loss of its ability to issue tax-exempt bonds for housing and of its authority to allocate housing tax credits.” Goes on to say, how “…preemption is a more direct alternative to conditioning federal grants in aid.” And how Congress might “…act directly to eliminate restrictive suburban land use practices by exercising its own constitutional power to regulate commerce.”

Whew! Did you read what I just read, and reprinted here for you? Manufactured ‘housers’ know all ‘bout preemption, and how this industry made that 1974-76 regulatory ‘lemon’ into sweet lemonade. Will same will occur working with local land planners & zoning boards?

This report is chock full of helpful background information on the timely and troubling topic. It documents five presidential commissions and federal initiatives of the past 50 years. Also lists five bullet points describing how regulatory barriers raise housing prices; plus, how barriers reduce and delay housing development; and finally, how barriers increase income inequality and reduce economic growth. These will be detailed in the October Allen Letter.

This report also, to my surprise, details nearly 40 specific measures designed to address the exclusionary land use problem. The list begins with measures proposed during the Obama administration (a.k.a. Development Toolkit 2016) and going forward to today. These aggressive measures will be replicated in the October’s the Allen CONFIDENTIAL! business newsletter.

Both newsletters available, via subscription, at www.educatemhc.com

And there’s so much more ‘new news’ coming down the pike, so to speak, about changes to the federal housing scene, e.g. ‘Housing Finance Reform Plan’ for GSEs, pursuant to the Presidential Memorandum Issues March 27, 2019 – and released on 5 September 2019. More on this heady topic, likely in blog posting # 552 next week.

Good Enough for IHS, but NOT Good Enough for BSHS

Wednesday, September 4th, 2019

2019; Copyright 2019; www.educatemhc.com

Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog is sole online national advocate, official ombudsman, asset class historian, research reporter, PM education resource & communication media for all land lease communities!

To input this blog &/or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email gfa71546@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U! Goal: promote HUD-Code manufactured housing & land lease communities as U.S. source of affordable attainable housing! Next MHM class @ 9/11/19

INTRODUCTION: Over the decades, many have likened manufactured housing to be the Rodney Dangerfield of factory-built housing. Part I is a clear example of that metaphor. Part II? A timely but sad example of what greed can do to otherwise ‘affordable housing’ and its lifestyle. And Part III? Simply a WARNING! Does ‘the shoe fit’ your present day on-site new home sales and seller-financing experience? If so, then ‘being forewarned is being forearmed!’

I.

Good Enough For IHS, but NOT Good Enough For BSHS

Specifically,

‘HUD-Code manufactured housing was good enough, as centerpiece, of the HUD & NAHB-hosted Innovative Housing Showcase, on the National Mall during June of this year, but is NOT good enough to be featured, or invited to appear, at NAHB’s Building Systems Housing Summit, 6-8 October, in Pittsburgh, PA.!’

In the August issue of BUILDER magazine, NAHB chairman Greg Ugalde, in ‘Spotlight on Affordable Housing’, identified “…lack of skilled labor, excessive regulatory costs, and an increase in materials prices…” as being main factors that drive up the cost of building a home. He then writes glowingly of the aforementioned Innovative Housing Showcase, “…which included full-sized homes and new building techniques….” Page # 57. Note the lack of mention, that all three full-sized homes, from steel undercarriages to roof peaks, were HUD-Code manufactured homes! So, HUD-Code manufactured housing was good enough for the HIS.

In the August issue of BUILDER magazine, on page # 18, there’s a full page ad inviting readers to attend the Building Systems Housing Summit, 6-8 October, in Pittsburgh, PA. The event is described as being “…the industry’s premier conference dedicated to off-site construction.” – a euphemism, in site-built builder circles, for ‘factory-built housing’. The ad goes on to say “…builders, manufacturers and suppliers of modular, panelized, concrete, log and timber frame homes…” will discover emerging systems-built housing trends and more. Do you see HUD-Code manufactured housing – again, the star of the Innovative Housing Showcase, mentioned anywhere in that verbiage ballyhooing the Building Systems Housing Summit? Me neither. So, HUD-Code manufactured housing is evidently NOT good enough for the BSHS.

Point to all this? Should be patently obvious. It’s OK to showcase manufactured housing to a public who doesn’t know any better (Anecdotally; a builder of site-built homes toured one of the three MHs on display at the National Mall, thinking it was a site-built home, until he was informed otherwise.); but do NOT welcome them (except for Clayton Homes, as that firm was featured in an earlier BUILDER issue) into the inner (political) workings of the NAHB, lest more builders climb aboard the HUD-Code housing train. Somehow, that simply does not make any sense, but that’s certainly the way it is.

Know what? I’d attend the Building Systems Housing Summit in Pittsburgh in October, except I’m committed to speak at the 10th anniversary SECO Conference in Atlanta that week. And know what my topic will be? ‘State of the Manufactured Housing Industry & Land Lease Community Real Estate Asset Class!’ Hmm. Perhaps NAHB folk traveling to Pittsburgh would learn more about factory-built housing reality by patronizing the SECO Conference instead. For more info, visit www.seco.com

Sidebar bottom line? One more example of internecine squabbling and lack of political and advocacy cooperation, i.e. site-builders versus manufactured housing; MHI versus MHARR

II.

Don’t Be ‘Woke’, Then Broke, in 2020!

So, as a land lease community owner/operator, did you heed the advice in blog # 549 bearing this same title: ‘Don’t Be ‘Woke’, Then Broke, in 2020!’? If so, you’ve now read, or are about to read, the September issue of the Allen Letter, learning the full story behind the pernicious (‘highly destructive, ruinous’) threat of national rent control – that could sweep up land lease communities in its’ wake! If you haven’t taken steps to get on board with the Allen Letter, visit www.educatemhc.com

What’s the latest? Well, we’ll know more next week when the 28th annual Networking Roundtable convenes. So far, only NAMHCO, as national advocate for manufactured housing and land lease communities will be represented. That’s short for National Association of Manufactured Housing Community Owners (national lobbyist for the realty asset class). We know already there’ll be owners/operators of some of the largest and most influential land lease community portfolios in North America.

Maybe at the last minute, an executive from MHI will register to attend, but I’m not counting on it. No matter really, as I’ll be traveling to Savannah, GA., on 23 September, to attend MHI’s annual meeting in general, the National Communities Council division session in particular. Will be interesting to see if this timely, nefarious topic (i.e. national rent control) is even on the agenda; brought up during said meeting; or as is most oft the case, left for me to introduce.

MHARR input? Ask them why they promote a new national advocacy entity for post-production segments of the manufactured housing industry, but never patronize the only annual national event focused solely on land lease community owners/operators – the supposed core cohort for any such new group. It’s a mystery.

Finally. ‘Don’t wait for the other shoe (legislation) to drop!’ Exercise care in adjusting your rental homesite rates; encourage your peers – even competitors, to be mindful of applying the traditional 3:1 Rule of Thumb when estimating appropriate rental homesite rates for every market in which land lease communities are owned/operated.*1

Note.
1. 3:1 Rule of Thumb. Conventional apartment unit (3BR2B) rent rates are oft three times the amount charged for land lease community rental homesites in the same local housing market, e.g. $900/month = apartment; $300+/-/month = LLCommunity.

III.

WARNING!

If you’re a land lease community owner guaranteeing home loans underwritten and serviced by an independent third party lender, have you taken contractual steps to ensure complete and accurate disclosure, to you as guarantor, and in writing, of the unpaid balance, including default-related charges added to mortgagor’s account, if and when a homeowner/site lessee defaults on his/her home loan?

If not, do so ASAP! Stories are circulating around the manufactured housing industry, of lenders stating unpaid balances sans documentati

Don’t Be ‘Woke’, Then Broke, in 2020!

Wednesday, August 28th, 2019

2019; Copyright 2019; www.educatemhc.com

Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog is sole online national advocate, official ombudsman, asset class historian, research reporter, PM education resource & communication media for all land lease communities!

To input this blog &/or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U! Goal: promote HUD-Code manufactured housing & land lease communities as U.S. source of affordable attainable housing! Next MHM class @ 9/11/19

INTRODUCTION: Short and (not so) sweet this week! All kinds of interesting – and at times important, ‘breaking news’ around manufactured housing and land lease communities! This week however, just telling you one thing – the risk some, if not many, property portfolio firms are taking, for themselves (i.e. overreaching profit ploys) and the rest of us (stimulating potentially troublesome regulatory legislation). Not enough space to tell you the whole tale here; you’ll have to read, as Paul Harvey was wont to say, ‘the rest of the story’ in the next issue of the Allen Letter. Not a subscriber? Visit www.educatemhc.com to do so!

I.

Don’t Be ‘Woke’, Then Broke, in 2020!

(‘woke’ = ‘aware of social injustice’, e.g. site rent surfeit)

Caution: Year 2000 MH$ Debacle to Maybe Repeat During Year 2020

To understand what follows, you either had to have been active in manufactured housing between years 1998 & 2002, or have read ‘Upside Down in a Mobile Home Park’, circa 2000. In the latter instance, the muckraking classic can be found in an old issue of Manufactured Home Merchandiser magazine (a casualty of MH$ debacle), or as Figure G, in Chapter 1, of SWAN SONG – available via www.educatemhc.com.

Gist of being ‘upside down’? How deep discounting of housing down payments (e.g. $5500 reduced to $500), then added to loan balance; deceptively generous but short term adjustable rate (‘A/R’) mortgages; and one year of deferred homesite rent, combined to bring about more than 300,000 ‘repo’ manufactured homes valued at more than $1.3 billion by year 2002, according to a CFPB ‘white paper’. Consequences? Loss of easy access to chattel capital going forward – nary to return, even by year 2019; and, plummeting of new home shipment volume from 372,943+/- in 1998 to only 49,789+/- during industry’s nadir year 2009.*1

Now, looking ahead to year 2020. How do some, if not many of us, see this sorry history maybe repeating itself going forward? Simple. This time around land lease communities, as a real estate asset class, are frequently dealing with rental homesite rates being increased quickly and greatly within recently acquired standalone land lease communities, and within property portfolios, often owned/operated by private equity firms outside the manufactured housing industry.

So, like the ‘upside down’ expose’ tale of two decades past, how do today’s inordinate rental homesite rates affect homeowners/site lessees, on one hand; and the owners/operators of subject land lease communities, on the other? That’s more than can be covered here, but will be fully told, in first person fashion, as a feature in an upcoming issue of the Allen Letter.

Two hints. The ability to buy the house needed, and ability to pay PITI (loan principal, interest, taxes, insurance) and household utilities, is severely impaired when rental homesite rates exceed the 3:1 Rule of Thumb guideline widely used since the 1970s.*2 And, the unexpected ‘woke’ effect on land lease community owners/operators who’ve never been through a site rent juggernaut before. It’s not a pretty picture. So, as an owner/operator you owe it to yourself to read and learn from this new expose’!

FYI. This is the fifth time since 1970, the manufactured housing industry has unintentionally set itself up for a major shakeout! And all the while, we continue our slow paradigm shift/recovery from the last MH$ debacle, our loss of easy access to chattel capital for new home loans!

To subscribe to the Allen Letter, simply visit www.educatemhc.com You’ll be glad you did! The story will appear nowhere else….

End Notes

1. Until year 2013, monthly manufactured housing shipment totals reported by HUD’s contractor, the Institute for Building Technology & Safety (‘IBTS’), were reported differently by MHI & MHARR. Since then however, HUD, MHARR, NAMHCO, & EducateMHC have reported said totals similarly, so official record of shipment totals is now consistent among those four industry advocates, negating the need for a +/- qualifier.

2. 3:1 Rule of Thumb. Rental homsite rates, in general, are one third the monthly rent charged in a like-sized (e.g. 3BR2B) conventional apartment in the same local housing market as the subject land lease community; e.g. $900/month apartment rent = $300/month approximate land lease community rental homsite rate. Today however, an increasing number of markets are experiencing a 2:1 ratio; e.g. $900/month apartment rent = $450/month approximate land lease community homesite rate.

Pass This Blog Onto Land Lease Community Owners/operators Nationwide!

Wednesday, August 21st, 2019

August 2019; Copyright 2019; www.educatemhc.com

Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog is sole online national advocate, official ombudsman, asset class historian, research reporter, PM education resource & communication media for all land lease communities!

To input this blog &/or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U! Goal: promote HUD-Code manufactured housing & land lease communities as U.S. Source of affordable attainable housing! Next MHM class @ 9/11/19

INTRODUCTION: One important topic today! Yes, it’s that important. Period. And, as Part I of this week’s blog posting asks…

I.

Please Pass This Blog Onto Land Lease Community Owners/operators Nationwide

This year is the 28th consecutive year Carolyn & I have hosted the International Networking Roundtable. And it’s the first time, since years 2008 & 2009, this popular land lease community owner/operator-focused event, is timed and positioned to play a key role influencing the fate of the manufactured housing industry going forward!

How so? Well, if you’ve been following weekly blog postings, at this website during the past month (blogs # 544, 546, & 547), you know of the homeowner/site lessee (a.k.a. ‘residents’) unrest within institutional investment grade land lease communities owned by some – but certainly not all, property portfolios controlled by fewer than a dozen private equity fund managers. Oft at issue, is the immediacy, size, and or frequency of rental homesite rate increases, upon acquisition of land lease communities.

Two recent indicators of present and future, impending concern:

‘Legalized Looting: Mobile Home Rent Increases Require Wall Street Reforms’. Headline; U.S. Senator Elizabeth Warren’s guest opinion piece dated 26 July 2019. Quoted from blog # 544.

‘The (manufactured housing) industry needed a regulatory framework on construction in 1976, and it needs a new framework for community ownership & operation in 2019. House Bill HR 2832 is a start!’ Quoted from Doug Ryan’s op/ed piece in Prosperity Now press. Blog # 547.

So, what to do about this troublesome matter? Discuss it at the 28th Networking Roundtable, 8-10 September in Indianapolis, IN. Already, several open forums are scheduled:

• Spencer Roane, MHM, from 3-4PM, 8 September, will host an open discussion about ‘financing homebuyers/site lessees who can’t qualify for conventional chattel loans’.

• From 4-5PM, I’ll host a ‘fireside chat’ type discussion ‘on topics of choice’ by individuals so-gathered. Can be ‘evergreen issues’*1, or otherwise*2. Or not here listed.

• And during the Roundtable proper, either 9 or 10 September, time will be set aside for the overarching topic described earlier in this blog – IF there’s interest in doing so. You?

A caveat (‘warning’). Should there be no group meeting/discussion, among private equity fund managers and or their land lease community portfolio owners/operators, with industry and realty asset class leaders – and the aforesaid national legislative regulatory threat continiues to grow, expect a clarion (‘obtrusively clear’) call for the first National State of the Asset Class (‘NSAC’) caucus in a decade*3! So, let’s get this conversation started in early September. If not already registered for the Networking Roundtable event, visit www.educatemhc.com or phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

End Notes.

1. Evergreen (i.e. ‘always relevant’) Issues: 1) responsibility for proper, safe & secure installation of HUD-Code homes; 2) HUD declares manufactured housing ‘affordable’ but refuses to overtly promote same; 3) present MH stock is aging faster than new homes are being fabricated & shipped; 4) continuing lack of reasonable access to chattel capital & disparate loan percentages between chattel capital & real estate-secured rates – even with property owner guarantee; 5) propensity to sell homebuyers more house than they can truly afford, by not including utility expenses in PITI & site rent $ total; 6) negative symbiotic comparing of new HUD-Code homes going onto private sites conveyed fee simple, with those going onto rental homesites within land lease communities; and, 7) lack of two secondary markets: one to value and sell resale homes, and marketing of seasoned chattel capital loans.

2. Otherwise issues: 1) ‘New Type’ HUD-Code manufactured home for underserved markets (e.g. millennials & retirees); 2) GSEs ‘slow walk’ DTS (Duty to Serve) programs for chattel capital, & parallel efforts to serve realty-secured loans via Choice & MH Advantage programs; 3) local housing market intransigence relative to zoning & rezoning in behalf of manufactured housing & land lease community development; 4) national advocacy overlap diluting lobbying effort on national stage; 5) lack of state MH association support by many property portfolio firms; 6) Big Three MH manufacturers (i.e. Clayton, Cavco, Skyline-Champion) garnering 80+/-% of national market share of HUD-Code homes; and, 7) growing evidence of near-predatory site rent increases.

3. As described in blog # 544, two National State of the Asset Class caucuses were held; one on 2/28/2008 & another, 2/28/2009. In the first instance, more than 100 (then) manufactured home community owners/operators gathered at a community in Tampa, FL. Result? Five Strategies & Action Areas designed to preserve their collective business model. A year later, to the day, a second NSAC caucus was hosted by the RV/MH Hall of Fame in Elkhart, IN. This too was attended by 100+, a mix of HUD-Code housing manufacturers & land lease community owners/operators from throughout the U.S. Result? New HUD-Code housing design friendly for community placement, featuring WOW! Factors and durability-enhancing features intended to reduce turnaround time and cost expenditure, between home buyers and or renters. Later labeled, by Don Westphal, landscape consultant, as Community Series Homes – to, in part, differentiate from ‘big box = big bucks’ Developer Series Homes of the late 1990s.

***

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

Told you so! (&) What’s the $ margin?

Saturday, August 17th, 2019

Blog # 547 @ 15 August 2019; Copyright 2019; www.educatemhc.com
Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog is sole online national advocate, official ombudsman, asset class historian, research reporter, PM education resource & communication media for all land lease communities!

To input this blog &U/or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email gfa7156@aol.com & visit www.eduatemhc.com

Motto: ‘U Support Us & WE Serve U!’ Goal: promote HUD-Code manufactured housing & land lease communities as U.S. source of affordable obtainable housing! Next MHM class @ 9/11/19

INTRODUCTION: Three widely disparate topics today: threat of national rent control – a fact or fiction? How ‘bout the $ difference between production value of a new HUD-Code home and its’ retail sale value? And five things many might want to see occur inside our nation’s capitol beltway, but don’t hold your breath! If you enjoy these blogs, you’d really appreciate the Allen Letter each month! Just go to www.educatemhc.com to subscribe.

I.

TOLD YOU SO!

This from Doug Ryan’s recent article in Prosperity Now publication: “The (manufactured housing) industry needed a regulatory framework on construction in 1976, and it needs a new framework for community ownership and operation in 2019. (S0) house bill HR 2832 is a start!”

If Doug is right about this second historic ‘start’, what do you, as a land lease community owner/operator, suppose the ‘finish’ or regulatory legislation will be like if/when passed?

Remember now, we’re talking about the consequence, in large part, due to flagrant site rent increases by some property portfolio firms owned, in some cases, by private equity management firms.

If somehow this is ‘new news’ to you, take time NOW, to scroll back through blog postings # 543 thru 546 on this website.

Where do we go from here? Well that’s up to you. As host, along with EducateMHC, of the upcoming 28th annual Networking Roundtable (8-10 September in Indianapolis, IN.), I’ve been asked ‘time & again already’ to arrange private and public meetings among concerned parties, concerning this threat of national rent control. Registered attendees already represent a broad spectrum of land lease community owners/operators, from small Mom & Pop owners to several of the 500 known portfolio ‘players’. Will you be present for this year’s event? Not too late to register. Simply go to www.educatemhc.com right away.

II.

$44K Margin Between Production & Sales Value?

You tell me. Some statisticians say the 96,555 new HUD-Code homes shipped during year 2018 sold for $6.4 billion in retail value, or an average of $66,200 per manufactured home, all configurations. AND, the estimated ‘production value’ of those 96,555 new HUD-Code homes was $4.2 billion or $43,126 per manufactured home, using Dr. Stephen C. Cooke’s 2013 base year data. This calculates to a $2.2 billion margin between the two values, or $23,074 per HUD-Code manufactured home.

OK ‘out there’ anyone else have a better handle on this elusive subject? Personally, given the increases in manufactured housing product cost between years 2013 & 2018, the $43,126 production value is probably too low to be accurate today. But hey, what else do we have to work with at this point in time? I keep hearing rumors: ‘We’re working on an update’, but we continue to wait.

Let me know your thoughts on this matter via gfa7156@aol.com or (317) 346-7156

III.

On a Purely Political Note…

When I first read Mark G. Brennan’s ‘Five Modest swamp-Draining Proposals’, in CHRONICLES, a magazine of American culture, I just knew I had to prepare and share a digest of the author’s points with you:

• “Remove all air conditioners (and fans) within the geographic limits of Washington, D.C.” Some want a Green New Deal? “…what a better way to kick it off than to eradicate unnecessary energy use?”

• “All congressmen, senators, and federal employees must prepare their own taxes with no help from anyone, either their accountants nor their spouses.”

• “Congressional representatives and senators will serve as Casualty Notification Officers (‘CNOs’) for the deaths of all military personnel in their districts.”

• ‘All congressmen, senators, and federal employees will be paid the lesser of their current salary or the median national income. According to the U.S. Census Bureau, the median household income for 2017 was $61,372.”

• “All congressmen, senators, and federal employees must send their children to the Washington, D.C., public schools.”

Just saying….

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