State of Nation’s Housing & Much Much More….

2019; Copyright 2019; www.educatemhnc.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 obtainable housing! Next MHM class @ 9/11

INTRODUCTION: This week’s blog posting ‘opens strong’ & ‘saves the best for last’, or so it seems. Everyone knows about the RV/MH Hall of Fame, but how many of you know what it takes to be considered for induction? Well, here’s how you do it!

Then here’re 20 good reasons (i.e. top notch speakers named) to attend the 28th Networking Roundtable scheduled for 8-10 September, in Indianapolis, IN. Hope you’ll be there with us!

One more pass, for now, at the idea or concept of ‘leveling the manufactured housing finance playing field’, when it comes to having similar loan terms for RE-secured & chattel capital loans.

Finally, and you might want to read Part IV first: The Joint Center for Housing Studies at Harvard University recently, in Atlanta, GA., briefed the nation as to what is really happening throughout the housing industry these days! This is a MUST READ for every ‘houser’ active in the HUD-Code manufactured housing business and land lease community real estate asset class. NO ONE ELSE is going to share these ‘stats’, trends, and issues with you! GFA

I.

You Eligible for Induction into the RV/MH Hall of Fame? Probably….

If you’ve been “…an active participant in any segment of the recreation vehicle or manufactured housing industries for a minimum of 25 years…”, you are eligible for consideration when a RV/MH Hall of Fame nomination form has been properly completed, by you or someone who knows you well, and believes you deserve this singular honor!

Furthermore, the completed nomination form, when sent to the RV/MH Hall of Fame in Elkhart, IN. (2156 Executive Blvd., 46514) “…must be accompanied by three supporting letters (no more, no less) that meet the Hall’s guidelines for these letters.” before 31 October of any year. “The nominee will (then) be in the pool of candidates considered for (induction) the following year and for five years beyond that.” Specific guidelines? Read next short paragraph.

For more information, and to download the nomination form (MS Word Format) and support letters form (PDF format), visit www.rvmhheritagefoundation.org

In closing, here are a couple personal tips you may, or may not, want to factor into your plans to become eligible for nomination and induction into the prestigious RV/MH Hall of Fame.

• Familiarize yourself with protocols, pomp and circumstance, that make this honor event unique to both industries, by attending the annual RV/MH Hall of Fame induction banquet and ceremony (Monday, 5 August, 2019). Expect to rub shoulders with 500-700 Hall of Fame members, guests, families, friends, and business associates from throughout the U.S. and Canada. Phone (574) 293-2344 for tickets!

• While certainly not a requirement, add a measure of credibility and personal support, by asking a present RV/MH Hall of Fame member, who is a friend or colleague, to prepare one of the letters penned in your behalf.

To learn more about the RV/MH Hall of Fame, and read stories about a few inductees from the manufactured housing industry and land lease community real estate asset class, peruse the soon to be distributed (July-August-September) issue of MHInsider magazine, especially the Allen Legacy column at the very end of the publication. To ensure receiving a copy, email: Darren@datacomp.com

And finally, a dozen or more land lease community owners/operators often convene, during the daytime before the (5 August) evening (6-9:30PM) banquet and induction ceremony, to identify emerging industry/asset class trends (e.g. two decades long MH paradigm shift since year 2000), ‘evergreen MH issues’ of note (e.g. pro & con of GSE’s DTS programs in 2019), and Lessons Learned from our business models during the past year. This August, while there’s no formal agenda yet, Spencer Roane, MHM, will be on hand to describe and ‘splain’ the new E-HOP chattel capital program for financing new HUD-Code homes in land lease communities! And I’d like to hear your views on the concept of ‘leveling the manufactured housing finance ‘playing field’ (i.e. lessening % spread between RE-secured and personal property loan terms via property owner recourse). Read blog postings # 541 & 542. PLUS, I’ll be handing out FREE copies of the popular booklet: Who Will Preserve Your Legacy? Answer: You!

So, if the content of the previous paragraph truly interests you, let me know ASAP via gfa7156@aol.com or via (317) 346-7156, if you plan to participate! At that time, I’ll tell you when and where we’ll be convening. There’s no $ charge to participate, nor are you expected to attend the banquet! But know, this day and evening together, makes for the most energizing, memorable, ‘feel good’ RV/MH events to occur all year long! GFA

II.

20 Good Reasons to Attend Networking Roundtable, 8-10 September, in Indianapolis

Keynote presenters, featured speakers, and businessmen and women of renown headline this year’s 28th annual Networking Roundtable. Run your eyes down this august list and be surprised how many of them you know, and how they’ll all be in Indianapolis with us on 8-10 September:

U.S. Senator TODD YOUNG, with 13 other senators, has sponsored an affordable housing bill

JEFF DAVIDSON, Meritus MHCommunities & MIKE CALLAGHAN, Four Leaf Properties sharing!

MIKE NIEBAUER of Rent Manager (firm debuted at 1989 Roundtable!) to explain automation

Both GSEs, & possibly FHFA, to be on hand to walk everyone thru Duty to Serve (DTS programs)

JULIO JARAMILLO of Evergreen Communities to share his secrets to property portfolio success!

DON WESTPHAL, who everyone knows & likes, will hold forth on LLCommunity rehabilitation

DARREN KROLEWSKY of DATACOMP will describe ‘better online digital footprints’ via MHVillage

NANCY CAROL from Universal Utilities will address the Roundtable family for the first time ever

SPENCERE ROANE to update us as to what’s happening with seller-finance in LLCommunities

TODD NEWBY’S firm introduced resident relations to LLCommunities in 1990s – an update!

PAUL BRADLEY of ROC USA will share winning videos from Noble Home Video Contest

DAVE REYNOLDS of IMPACTMHC will share videos taken on-site during fix ups at his properties

GEORGE ALLEN to ‘open’ & ‘close’ the 2 ½ days event, probing issues & trends in MH

And expect to enjoy two MH & LLCommunity ‘no holds barred’ financial panels Tuesday AM

Well, there’re 13 of the 20+ committed presenters for this year’s Roundtable event. Bet you’d like to hear each and every one of them! Do so, by visiting wwweducatemhc.com & register

In closing, allow me to point up something I think is telling. Can you think of any other national MH & LLCommunity meeting venue, other than this Roundtable event and the SECO Conference that informs you (all of us) ahead of time who the presenters are going to be?

III.

Leveling the MH$ Playing Field Discussion Continues…

Not going to delve into this heady, timely, controversial topic in toto in this blog posting. Rather, just sharing a thought-provoking communique we received from one of the MH Industry’s most knowledgeable chattel capital originators/servers, who’s no longer active in the business:

‘Part of the problem with this (i.e. leveling the $ playing field) is a lack of understanding of the increased risks that come with chattel lending, and lack of understanding of how a lower amount to (be) financed does not change the costs of originating and servicing MH chattel loans. The interest rates need to be higher to cover those costs, (as well as) the incentive for greater profits motivating lenders to make these loans in the first place.” (lightly edited)

Points taken. However, securing the realty property owner’s guarantee (i.e. recourse agreement) is intended to mitigate the added risk associated with personal property loans not secured by underlying real estate. Now, costs to originate and service said loans are indeed an important matter, as is the motivation (greed?) factor.

Like with the past couple blog postings (i.e. #s 541 & 542), we’re desirous of your ‘take’ on this matter. So far it’s not gained traction among independent chattel capital lenders serving the manufactured housing industry. Is that because everyone hopes the concept (of leveling the playing field) will go away?

Respond, if you will, via gfa7156@aol.com or (317) 346-7156.

IV.

‘The State of the Nation’s Housing’

Spencer Roane, MHM, of Pentagon Properties in Atlanta, GA., recently represented the manufactured housing industry and land lease community real estate asset class at a program presented by the Joint Center for Housing Studies of Harvard University (‘JCHS’), titled:
‘The State of the Nation’s Housing’. Spencer obtained an extra copy of the 42 page 2019 research document referred to by the presenters throughout their program. And upon reading, it provides very interesting information on this sweeping and timely subject. You ready?

“The shortfall in new homes is keeping pressure on house prices and rents, eroding affordability – particularly for modest-income households in high-cost markets.” P.1 Specifically, “…reaching bottom in 2011 at just 633,000 new units, additions to the housing stock have grown at an average annual rate of just 10 percent.” How ‘bout manufactured housing? ‘Reaching bottom in 2009 at just 48,789 new units, additions to manufactured housing stock have grown at an average rate of just 10.8 percent.’ Now you know.

“Sluggish construction recovery is in part a response to persistently weak household growth after the recession….”p.1, PLUS, “builders & lenders alike are wary of speculative development that would expand the housing supply too rapidly.”p.2, (&) “…rising costs of labor, land and materials…restricting the supply of land available for higher-density development”p.3, (&) “…ability to purchase a home depends largely on access to mortgage financing.”p.19, (&) “real home prices are approaching pre-crisis levels…eroding affordability for first-time homebuyers….”p.19, (&) “renter protection laws have gained some traction.”p.35 Now, ask yourself? How many of these reasons for this nation’s ‘sluggish construction recovery’ also apply to the manufactured housing production and land lease community infill scenarios as well? Just about every one of them!

Now, for factors favoring growth of manufactured housing, without saying so specifically:

• “…housing being built is intended primarily for the higher end of the market.” P.2

• Labor shortages. “…competition for workers has intensified, limiting the ability of the construction sector to ramp up quickly.” P.2

• Household growth has stabilized at early 2000s levels. P.14

• Number of young-adult households is increasing in line with population growth. P.14

• High rents delay ability of younger adults to form independent households. P.15

And, as if to underscore some points made in previous paragraphs, here are some particularly salient quotes:

• “…a rise in interest rates and home prices plus a tightening of credit, on top of the limited supply of entry-level housing, could put homeownership out of reach for many more households.” – unless manufactured housing industry ‘steps up to the plate’ too loudly and nationally advertise its’ brand of factory-built housing!

• “Housing markets lost steam at the end of 2018, as interest rates rose and new construction, home sales, and price appreciation all slowed. But even as rates came back down in early 2019, and helped stabilize markets, the national housing supply remained constrained by more than 10 years of historically low production levels. The tight supply of homes for sale is keeping the pressure on prices in much of the country, while high land prices, labor shortages, and restrictive land use policies limit development of moderate-cost housing.” P.7 – unless manufactured housing ‘steps up to the plate’ to loudly and nationally advertise its’ brand of factory-built housing!

• “…the next decade, the fastest-growing household types will be younger families and older empty-nesters – households with very different housing needs. The growing share of foreign-born households will also add to the increasing diversity of demand.” P.13 – markets semi-traditional for manufactured housing, just needing revisiting and massive advertising!

• “According to the 2017 American Community Survey, the typical household earning less than $15,000 per year, spent 17.5 percent of that income on energy costs, with shares slightly higher for homeowners (20.6 percent) than for renters (15.3 percent).” P.36 Keep this in mind as you manipulate the Housing Expense Factor (‘HEF’) of 30 percent, usually set aside for PITI (principal, interest, taxes, insurance) and rental homesite rent.

• Median sized house in 2018? 2,386 square feet. Median sale price of single-family homes in 2018? $326,400. P.38. HUD-Code manufactured housing is certainly ‘the right size’ and ‘right price’ to market to today’s prospective homebuyer/site lessee!

Lot of interesting and helpful information in this JCHS booklet, quoted in the previous paragraphs. Surprising and disappointing no one else in the manufactured housing industry and land lease community rental asset class attended this national briefing. So, pick and choose here, what helps you the most, as you fabricate, sell, and finance new HUD-Code manufactured homes, especially those installed on rental homesites within land lease communities, large and small, nationwide.

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POSTSCRIPT.

Have you purchased your copy of Community Management in the Manufactured Housing Industry? You really should. It’s that good! To do so, visit www.educatemhc.com

George Allen, CPM, MHM; c/o Educate

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