George Allen / EducateMHC Blog Mobile Home & Land Lease Community Advocate & Expert

Blog Posting # 829; Copyright 1 February 2025. EducateMHC

Know this! HUD-Code manufactured housing (‘MH’) is federally-regulated, performance-based, affordable-attainable, factory-built housing (a.k.a. offsite construction). Land lease communities (a.k.a. manufactured home communities & ‘mobile home parks’) comprise the commercial real estate (‘CRE’) component of MH; and, along with a couple types of housing finance (e.g. chattel or ‘home only’ loans & real estate-secured mortgages), describe the post-production segment of MH.

EducateMHC is the official MH Historian, trade term & trend tracker, as well as perennial information source. Contact EducateMHC via (317) 881-3815; email: gfa7156@aol.com, and www.educatemhc.com, to purchase Community Management in the Manufactured Housing Industry (A copy of which should be in every land lease community nationwide), & SWAN SONG – History of land lease communities & official record of annual MH production totals since 1955

And my autobiography, From SmittyAlpha6 to MHMaven, describes personal combat adventures in Vietnam as a USMC lieutenant, a 45 year entrepreneur business career in MH & community ownership, as well as freelance consulting and authoring of 30 nonfiction texts.

George Allen is the sole emeritus member of the Manufactured Housing Institutes (‘MHI’), a founding member of MHI’s National Communities Council (‘NCC’) division, an RV/MH Hall of Fame enshrinee, as well as Allen Legacy columnist and editor at large for MHInsider magazine.

RV/MH HALL OF FAME’S MH CLASS OF 2025

This time every year RV & MH aficionados anxiously wait to see who will be selected for induction into the prestigious RV/MH Hall of Fame in Elkhart, IN.  Well, here’s the list of manufactured housing pioneers and business leaders who’ll be enshrined Monday evening, August 18^th, 2025:

Bill Poynter. Manufacturer/MHRetailer with Guerdon Industries in Lexington, KY

Kurt Kelly.  Insurance executive with American Insurance Alliance, & publisher of Manufactured Housing Review online newsletter, in Spring, TX.

Nelson Steiner. Portfolio community owner/operator, founder of Steiner Communities in Tampa, FL.

Steven Schaub. Portfolio community owner/operator, with YES! Communities in Denver, CO. Successor to Gary McDaniel, who was inducted in 2014.

I encourage you to plan now to attend this gala affair in mid-August. Always more than 500 people present. And, besides the five individuals identified above, there’ll be five more who’ll be inducted from the RV industry. For more information visit RV/MH Hall of Fame website or phone (547)293-2344.

On another RV/MH Hall of Fame matter. Were you at the recent Louisville MHShow, during early January? If so, you noticed the half dozen or so individuals wearing bright green blazers during the first day of the show. These were all RV/MH Hall of Fame enshrinees, and the purpose of wearing their distinctive green RV/MH blazers was to increase awareness of this individual legacy honor for the RV & MH industries.

HERE WE GO AGAIN!

Quoting from SWAN SONG (History of land lease communities*1), page 30: “The year 1998 was truly pivotal for the HUD-Code manufactured housing industry! That year 372,843+/- new homes were shipped from factories to throughout the nation.” But “… home manufacturers (began) saturating local housing markets, with more ‘Big Box = Bix Bucks!’ homes than said markets could bear” leading to finance abuses affecting the industry to this day. So, “…predatory lending practices led to the industry’s loss of easy access to chattel capital from independent third party lenders.” For example, this mantra was popular: “We have no down (payment), no job, no problem (housing) deals for you!” Just how bad did get at the dawn of the century? Read ‘Upside Down in a Mobile Home Park’, circa 2000, Figure G in this text.

Fast forward to year 2025. What’s changed? Well, while we await year end MH production total for 2024, (Industry shipped only 89,169 new homes in 2023, but 100,000 are expected for year 2024), and continue our search for more ‘home only’ loans for manufactured homes sited in land lease communities, federal regulation once again rears its’ head. How so? Without naming the firm, here’s how the Consumer Financial Protection Bureau (‘CFPB’) recently (1/10/25) lambasted the manufactured housing industry for ‘setting borrowers up to fail in manufactured home loans’.

And how did all that happen? The CFPB cites three major ways:

“Manipulated lending standards when borrowers did not make sufficient income”. Here the firm “disregarded evidence borrowers did not have sufficient income or assets to pay their mortgage and cover recurring obligations and basic living expenses, like food and health care.”

“Fabricated unrealistic estimates of living expenses.” Here the firm used “artificially low estimates of living expenses that made no adjustment for higher expenses in different geographic areas. These families were left with little or no buffer to cover unexpected expenses.”

“Made loans to borrowers it projected could not pay.” Finally, the firm “made loans to borrowers who, even under the company’s overly-optimistic estimates, did not have enough income to cover the mortgage and basic living expenses.”

It is important to note here, only one independent MH finance firm is being challenged at this time. Hopefully there will be no further revelations.

In summary, it appears some of the same nefarious lending practices used in 1998-2000, to keep new MH production at 372,943+/- per year, are allegedly being used again today when we’re below 100,000 new manufactured homes produced per year. No wonder our industry – and realty asset class component; ballyhooed on one hand as this nation’s most affordable type housing, continues to suffer from a perennial poor reputation and image-tarnishing practices like those just described, as well as unduly escalating rental homesite rate hikes, and continuing sad lack of professional property management! If we want to experience another renaissance for manufactured housing production and land lease community lifestyle popularity, we know where we must improve performance – and sooner the better! GFA

Postscript. Does anyone in the manufactured housing industry and throughout the land lease community realty asset class see, as I do, the ongoing need for better national and regional leadership – both volunteer and paid, to step forward and challenge everyone in these two business models to get their act together and treat our customers and residents as fellow stakeholders? Right now, the only criticisms and pleas for market improvement come from online ‘influencers’, an occasional trade publication editorial, and a few pundits (i.e. ‘learned men & women’). We need to hear and see more leadership from our national and state industry and asset class advocates! For example, is this matter even on the agenda of at MHI’s upcoming winter meeting? I don’t know, as I’ve not been invited to attend and speak these issues.

Your thoughts on these timely – and some would say self-defeating, trade practices? Let me know via agfa7156@aol.com Your responses are kept confidential unless you indicate otherwise.

End Note.

1. SWAN SONG is available for purchase via www.educatemhc.com

George Allen

Blog Posting # 828; Copyright 24 January 2025. EducateMHC

Know this! HUD-Code manufactured housing (‘MH’) is federally-regulated, performance-based, affordable-attainable, factory-built housing (a.k.a. offsite construction_. Land lease communities (a.k.a.) manufactured home communities & ‘mobile home parks’) comprise the commercial real estate (‘CRE’) component of MH; and, along with various types of housing finance (e.g. chattel or ‘home only’ loans & real estate-secured mortgages), describe the post-production segment of MH.

EducateMHC is the official MH historian, trade term & trend tracker, as well as perennial information source. Contact EducateMHC vis (317) 881-3815; email: gfa7156@aol.com, and www.educatemhc.com, to purchase Community Management in the Manufactured Housing Industry (A copy of which should be in every land lease community nationwide), & SWAN SONG – History of land lease communities & official record of annual MH production totals since 1955

And my autobiography, From SmittyAlpha6 to MHMaven, describes personal combat adventures in Vietnam as a USMC lieutenant, a 45 year entrepreneur business career in MH & community ownership, as well as freelance consulting & authoring 30 nonfiction texts.

George Allen is the sole emeritus member of the Manufactured Housing Institute (“MHI’), a founding member of MHI’s National Communities Council (‘NCC’) division, an RV/MH Hall of Fame enshrinee, as well as Allen Legacy columnist and editor at large for MHInsider magazine.

LOUISVILLE MHSHOW RETROSPECTIVE

Ok, this was the biggest, coldest, best Louisville MHShow ever! The homes exhibit area was large enough to imagine walking through a luxury land lease community anywhere in the U.S. And the home designs, inside and out, were impressive (e.g. interiors featured textured and wood accents on walls, even wood shelving in closets). Supplier exhibiters were everywhere, or so it seemed – even several toters (a.k.a. transporters) or primary haulers. Everyone from OEM (original equipment manufacturers) to aftermarket suppliers of products and services was represented. Public educational and information-sharing sessions were more often packed to capacity than not. And finally, enough food vendor trucks to supply show attendees well!

With that said, here’s how one industry veteran businessman and show attendee summed up his experience at this year’s MHShow:

“I was encouraged to see more homes at the Louisville Show designed for the community market. There also seemed to be more ‘buzz’ about the community segment of the industry. A year or two ago there was NO talk whatsoever about new raw land development. Nowadays I’m hearing more and more. Perhaps (hopefully!) some of the old dysfunctional ‘trailer parks’ will go the redevelopment route and more attention will go to filling all communities. Another trend I noticed at the Show was the number of next generation community owners/operators getting into the business. I also HOPE I accurately perceived apprehension on the part of newbies about paying the dumb, outrageously high prices for communities that brokers and sellers have been promoting for several years.” (Lightly edited. GFA)

My further comments here confirm what you just read, and take matters a step or two forward:

Small homes, large homes, homes with many windows and front-loaded porches. Every one of these would be an attractive addition to any community with a vacant rental homesite large enough for installation. This underscores SECO’s (a supplier booth presence) MH2X project, whose goal is to encourage community owners/operators to ‘buy more new homes’ and see the industry’s annual new HUD-Code housing production total double by year end 2025. This means growing from 100,000+/- in 2024 (total isn’t official yet), to nigh 200,000 in 2025. How?*1

And yes, for the first time in years there were several firms represented who specialize in new community design and construction, as well as redevelopment. The only thing that bothers me about this renewed interest is that there hasn’t been a new text describing HOW TO develop new land lease communities since J. Wiley & Sons 1992 classic, Development, Marketing & Operation of Manufactured Home Communities. Used editions sometimes available online.

Years ago I penned a feature article for Manufactured Home Merchandiser magazine identifying dozens of families well into their second and third generations (one in its’ fifth) of ownership. Perhaps it’s time to revisit that phenomenon. Just think: Zeman, Landy, Partrich, Casenhiser, Fannon, Leichtman, Voss, Vukovich, Hames, Follett, Young, Steiner, Cohron, Newby, Shouhayib, Thomas, Scoular, Farren, and Blank, to name a few.

It’s about time common sense returns to valuing land lease communities. For too long, land lease community owners have been greedy selling their income-producing properties. Let me tell you about individuals who went this route while emotionally attached to their holdings – the personal consequences were seldom pleasant. And realty brokers/lenders facilitating overvaluing; they’ve turned this real estate asset class on its’ ear, and we’re now subject to all sorts of landlord-tenant legislation from coast to coast. Time to return to the old IRV formula!

If you missed this year’s MHShow you missed a very good one. Plan now to attend during January 2026.

End Note.

1. Via attending the SECO Conference in Atlanta, 8-10 September; participating in a daylong MH2X ‘HOW TO’ conference; and, using SECO’s exciting ShowSearch telephone application = ‘a new digital means of identifying factory sources of new HUD-Code homes nearby one’s community.’ Visit secoconference.com

New York City’s Big Ideas for Lowering Housing Costs

Last Sunday’s edition of the NEW YORK TIMES newspaper showcased this headlined feature:

BIG IDEAS FOR LOWERING NEW YORK CITY’S SKY-HIGH COST OF LIVING (Eliza Shapiro). Amongst the ideas were a few that just might be fare for HUD-Code manufactured homes and other forms of factory-built housing, a.k.a. offsite construction.

CONSTRUCT AFFORDABLE HOUSING ON PUBLIC HOUSING PARKING LOTS…Here quoting Rev. David Brawley, pastor of a church in Brooklyn. “We’ve identified New York City Housing Authority parking lots that could create about 15,000 homes for seniors.” This way, seniors moving out of NYCHA developments into these new homes would free up public housing for families on NYCHA waiting lists. Anyone in New York City paying attention?

ALLOW HOUSING IN BACKYARDS. “Homeowners should be able to allow their adult children to erect a foldable, tiny home in their backyards with a simple permit.” This has already become lawful and a commonplace practice in the state of California, but small footprint HUD-Code manufactured housing would be much more commodious than ‘foldable tiny homes.”

FIND SPACE FOR 12,000 NEW APARTMENTS THAT ARE ACTUALLY AFFORDABLE…”Trickle-down housing policies do not work, and so the city should invest in building at least 12,000 new units of deeply-subsidized affordable housing per year for five years, with half of those units targeted specifically for homeless households and half for extremely low-income households.” Again, small footprint HUD-Code manufactured homes would easily meet this affordability challenge!

USE MODULAR CONSTRUCITON TO HELP BUILD ALL OF IT. “Minneapolis and other cities are using modular construction to reduce costs and speed up timelines in affordable housing construction.” Yes, that’s indeed the case with HUD-Code manufactured homes, modular and panelized units, as well as possibly with Park Model RVs and ADUs (accessory dwelling units) such as customized steel shipping trailers, even sophisticated sheds.

MAKE IT ILLEGAL TO CHARGE MORE THAN 30 PERCENT OF HUEHOLD INCOME FOR RENT. Once again ‘rent control’ raises its’ progress destructive head. So much of this argument is hopelessly confused by what constitutes one’s gross and or net income, and just what household expenses to include in the equation.

These were just some of the interesting suggestions offered by the author of this idea list.

MEI Replaces DEI

Well there’s a new ‘sheriff’ in town. Donald Trump returned to the U.S. presidency on 20 January 2025 and took less than a day of ‘shock & awe’ to neuter many of his predecessor’s liberal policies and $-wasting directives. Probably chief among these changes was the official death of cultural and employment DEI (Diversity, Equity, Inclusion). So, what fills the void? Simply, MEI, short for Merit, Excellence, & Innovation. Nuff said.

Oh, the next day on Facebook, I saw a sign that ‘says it all’, where former president Biden’s family and friend pardons are concerned:

INNOCENT PROPLE DON’T NEED PARDONS!

George Allen

Blog Posting # 827; Copyright 17 January 2025. EducateMHC

Know this! HUD-Code manufactured housing (‘MH’) is federally-regulated, performance-based, affordable-attainable, factory-built housing (i.e. a type of offsite construction). Land lease communities (a.k.a. manufactured home communities & ‘mobile home parks’) comprise the commercial real estate (‘CRE’) component of MH; and, along with various forms of housing finance (e.g. chattel or ‘home only’ loans & real estate-secured mortgages), characterize the post-production segment of MH.

EducateMHC is the official MH historian, trade term & tend tracker, as well as perennial information source. Contact EducateMHC via (317) 881-3815; email: gfa7156@aol.com, and www.educatemhc.com, to purchase Community Management in the Manufactured Housing Industry (A copy should be in every land lease community office nationwide!) & SWAN SONG – History of land lease communities & official record of annual MH production totals since 1955.

And my autobiography, From SmittyAlpha6 to MHMaven, describes personal combat adventures in Vietnam as a USMC lieutenant, a 45 year entrepreneur business career in MH & community ownership, as well as freelance consulting and authoring of 30 nonfiction texts.

George Allen is the sole emeritus member of the Manufactured Housing Institute (”MHI’), a founding member of MHI’s National Communities Council (‘NCC’) division, an RV/MH Hall of Fame enshrinee, as well as Allen Legacy columnist and editor at large for MHInsider magazine.

INDUSTRY ‘WATCHDOG’ BARKS AGAIN!

If you weren’t aware the manufactured housing industry has a regulatory ‘watchdog’ alive and well, working on its’ behalf in Washington, DC., you haven’t been paying attention! The Manufactured Housing Association for Regulatory Reform (‘MHARR’), a 1985 spinoff from the Manufactured Housing Institute (‘MHI’), routinely and faithfully represents the regulatory-related interests of regional, independent HUD-Code manufactured housing producers.

What follows here are excerpts from a recent communique by MHARR titled: ‘TRUMP 2.0 – THE INDUSTRY’S SECOND CHANCE’, January 2025, penned by association executive Mark Weiss.

Following a detailed review of what the writer called ‘Trump 1.0’; a recitation of failed attempts to revitalize manufactured housing, MHARR offers this summary: “…at the conclusion of Trump 1.0, the industry remained in the crosshairs of a still-dangerous DOE energy standards directive, nothing of substance regarding the HUD program, and its preemptive regulatory authority, had changed, (as) localities were still targeting manufactured homes and manufactured homeowners with discriminatory and exclusionary zoning, and DTS remained an unfulfilled promise with absolutely no support forthcoming for the vast bulk of the manufactured housing consumer financing market….”*1 (Lightly edited. GFA)

With that said, MHARR challenges the manufactured housing industry to encourage Trump 2.0, “as a second Trump presidential term (begins), with a renewed and even more vigorous emphasis on regulatory reform and  availability of affordable housing being two of the central features of that impending administration…” And how “…the entire industry should be focused on tackling, addressing and, most importantly, resolving and remedying, once and for all, the three principal bottlenecks (identified) by MHARR in a May 2, 2024 News Release…” Those three bottlenecks being:

• Destructive and discriminatory DOE energy regulation

• Discriminatory and exclusionary state and local zoning laws; and

• Non-implementation of the DTS mandate with respect to manufactured housing personal property consumer loans.

If you want to learn more about these three bottlenecks, and you really should, reach out to MHARR via (202) 783-4087

Here’s how this MH trade advocacy entity ends this multipage challenge to the manufactured housing industry:

“…a second Trump presidential term provides the industry with a remarkable second chance! A second chance to clear away unnecessary and debilitating regulation. A second chance to eliminate (or significantly reduce) the discriminatory and exclusionary zoning edicts that have wrongly restricted its’ availability , a second chance to demand – and push through to fruition – much needed federal secondary market and securitization support of the vast bulk of manufactured home consumer chattel loans in accordance with DTS.”

End Note.

• DTS = Duty to Serve. A congressional mandate for Government Sponsored Enterprises (‘GSE’) Fannie Mae & Freddie Mac to better serve underserved housing initiatives

George Allen

Blog Posting # 826; Copyright 10 January 2025. EducateMHC

Know this! HUD-Code manufactured housing (‘MH’) is federally-regulated, performance-based, affordable –attainable, factory-built housing (a.k.a. offsite construction). Land lease communities (a.k.a. manufactured home communities & ‘mobile home parks’) comprise the commercial real estate (CRE’) component of MH; and, along with various forms of housing finance (e.g. chattel or ‘home only’ loans & real estate-secured mortgages), describe the post-production segment of MH.

EducateMHC is the official MH historian, trade term & trend tracker, as well as perennial information source. Contact EducateMHC via (317) 881-3815; email gfa71562@ao..com, and www.educatemhc.com, to purchase Community Management in the Manufactured Housing Industry (A copy should be in every land lease community office nationwide!), & SWAN SONG –History of land lease communities & official record of annual MH production totals since 1955.

And my autobiography, From SmittyAlpha6 to MHMaven, describes personal combat adventures in Vietnam as a USMC lieutenant, a 45 year entrepreneur business career in MH & community ownership, as well as freelance consulting and authoring of 30 nonfiction texts.

George Allen is the sole emeritus member of the Manufactured Housing Institute (‘MHI’), a founding member of MHI’s National Communities Council (‘NCC’) division, an RV/MH Hall of Fame enshrinee, as well as Allen Legacy columnist and editor at large for MHInsider magazine.

‘TOTAL U.S. HOUSING STARTS’ IN NOVEMBER 2024

Yes, you read that correctly. I’ve thoughtfully changed the heretofore ‘Whole U.S. Housing Story’ to ‘Total U.S. Housing Starts’, per reporting month – this time November 2024. Why? Because, unlike the U.S. Census Bureau’s Monthly New Residential Construction report of only the volume of new single-family, site-built housing starts, this ‘Total U.S. Housing Starts’ also includes offsite construction housing types (Some say factory-built) that includes HUD-Code manufactured housing, modular & panelized (or ‘prefab’) housing, and Park Model RVs!*1

For example, the U.S. Census Bureau’s Monthly New Residential Construction reports 1,289,000 annualized new housing starts during November 2024, or approximately 107,416 for the month alone. But the  ‘Total U.S. Housing Starts’ report, building on this Census Bureau data, estimates a grand total of 116,329 new housing starts during November, an addition of 8,913 units! Now that’s the whole housing starts story! Report methodology described in paragraphs following.

Here’re detailed descriptions of the offsite construction housing types (a.k.a. factory-built housing) cited in this ‘Total U.S. Housing Starts’ report:

HUD-Code manufactured housing, when installed on permanent foundations on building sites conveyed fee simple, are also identified as ‘single-family, site-built housing’. Manufactured housing not permanently installed, is oft sited in land lease communities (a.k.a. manufactured home communities & ‘mobile home parks’) on rental homesites – though, in some instances said sites are conveyed fee simple (e.g. Stardust Hills in Cloverdale, IN.). All types are included in the ‘Total U.S. Housing Starts’ report. Where does HUD-Code housing production data originate? With the Institute for Building Technology & Safety (‘IBTS’), on a subscription basis. IBTS reports monthly data, then the Manufactured Housing Institute (‘MHI’) and Manufactured Housing Association for Regulatory Reform (‘MHARR’), after reporting monthly data, publish an annual total, e.g. 89,169 new HUD-Code homes during year 2023. The sole published compilation of annual MH production figures, going back to 1955, is featured in the SWAN SONG text, available for purchase via www.educatemhc.com

Then there’re modular & panelized (‘prefab’) housing, two more types of offsite construction (again, a.k.a. factory-built housing), neither tracked by anyone! Why? Offsite construction units are built to local building codes (e.g. International Code Council or ICC), so are nearly impossible to research accurately. However, some housing professionals suggest this formula: 2% of seasonally-adjusted annual housing starts, per U.S. Census Bureau reporting, then reduce to a monthly figure, e.g. 1,289,000 ‘starts’ X .02%, then divided by 12 months = 2149 estimated volume of modular and panelized units fabricated during November 2024.

Park Model RVs (‘recreational vehicle’) production is tracked and reported monthly by the Recreational Vehicle Industry Association (‘RVIA’) via their online publication RVIA News (e.g. 315 Park Model RVs produced during November 2024). Or, simply ‘google’ Park Model RV production. This category of offsite construction is included because an increasing number of Park Model RVs are being used as permanent housing, particularly in Sunbelt regions of the U.S. And reportedly, some HUD-Code housing manufacturers, while routinely producing Park Model RVs in the past, are now fabricating some in accords with the HUD-Code.

Now pull the four pieces together (i.e. ‘single-family, site-built housing’, and the three types of offsite construction or factory-built housing), beginning with the latter category:

• HUD-Code manufactured housing unit production during November 2024:  8,597
• Modular & panelized 9’prefab’) units estimated for November 2024:             2,148
• Park Model RVs produced during November 2024:                                           + 315
• Offsite construction subtotal for November 2024:                                        11,060

• U.S. Census Bureau site-built housing ‘starts’ during November 2024:        107,417
• (+) Offsite construction subtotal for November 2024:                                   + 11,060
• Grand total of all U.S. Housing Starts during November 2024:                      118,477
• (-) 2148 Modular & panelized units, to offset a double count of 2148          116,329

Bottom Line: True total U.S. Housing Starts during November 2024 is 116,329 new homes!

End Note.

1. Offsite construction. ‘Refers to the planning, design, manufacture, and assembly of building elements at a location different from their final location, to support the rapid spread of and efficient construction of a permanent structure.’ Wikipedia

Manufactured Housing Production @ November 2024

IBTS reports 8,597 new HUD-Code homes produced during November 2024, down from 10,283 produced the month before.

Year To Date (‘YTD’) production? As of November 2024, 96,236 new homes produced compared to 82,809 during November 2023. Well on the way to eclipsing 100,000 new homes by year end!

Production value? Again, based on the decades old ‘per unit’ value factor of $43,126/unit, November 2024 production is worth $370 million, and YTD $4.15 billion. Interestingly, if the MH industry does eclipse 100,000 units by year end, the production value alone will be $4.3+ billion. But there may be more to this story. Doesn’t anyone else find it curious that the originators of this value factor (i.e. $43,126/MH) eschew (‘shun’) updating it? For example, if the ‘per MH’ value today is closer to $70,000/unit, then this year’s production value would be $7 billion, a far sight higher than expected now! Methinks the ‘powers that be’ appear intent on understating our industry’s value to the national economy (Why?), rather than showing legislators and regulators how valuable we are. And don’t forget; this has only been about ‘production value’. What happens when we factor in retail value, rental homesite dollar volume, and more? Your input on this mysterious, self-demeaning matter? Gfa7156@aol.com

Stock Market Report for 6 January 2025

BRK-A                          Berkshire Hathaway, Inc. (Clayton Homes)                           $681

SKY                              Skyline Champion Corporation                                              $89.60

CVCO                           Cavco Industries                                                                     $451.13

LEGH                           Legacy Housing Corporation                                                  $23.50

NOBH                          Nobility Homes                                                                       $33.00

ELS, Inc.                       Equity Lifestyle                                                                       $66.72

SUI, Inc.                       Sun Communities                                                                   $124.53

UMH, Inc.                    UMH Properties                                                                     $18.66

Flagship Communities                                                            $21.42

MHPC, Inc.                  Manufactured Housing Properties                                        $.62

Manufactured Housing/land lease community Composite Stock Index (‘CSI’) on January 2025 was $929. Down from $995 in December, but well above the base of $790 established in January 2022.

ONE FINAL REMINDER!

The RV/MH Hall of Fame requests all inductees/enshrinees wear their bright green blazers on 15 January 2025, to the Louisville MHShow in Louisville, KY. And continue to wear the blazers that evening at the gala social event. See you there!

George Allen                                                  

Blog Posting # 825; Copyright 3 January 2024. EducateMHC

Know this! HUD-code manufactured housing (‘MH’) is federally-regulated, performance-based, affordable-attainable, factory-built housing (i.e. a type of offsite construction). Land lease communities (a.k.a. manufactured home communities & ‘mobile home parks’) comprise the commercial real estate (‘CRE’) component of MH; and, along with various forms of housing finance (e.g. chattel or ‘home only’ loans & real estate-secured mortgages), characterize the post-production segment of MH.

EducateMHC is the official MH historian, trade term & trend tracker, as well as perennial information source. Contact EducateMHC via (317) 881-3815; email gfa7156@aol.com, and www.educatemhc.com, to purchase Community Management in the Manufactured Housing Industry (A copy should be in every land lease community office nationwide!), & SWAN SONG – History of land lease communities &  official record of annual MH production totals since 1955.

And my autobiography, From SmittyAlpha6 to MHMaven, describes personal combat adventures in Vietnam as a USMC lieutenant, a 45 year entrepreneur business career in MH & community ownership, as well as freelance consulting and authoring of 30 nonfiction texts.

George Allen is the sole emeritus member of the Manufactured Housing Institute (‘MHI’), a founding member of MHI’s National Communities council (‘NCC’) division, an RV/MH Hall of Fame enshrinee, as well as Allen Legacy columnist and editor at large for MHInsider magazine.

HAPPY NEW YEAR 2025!

“…the U.S. Census bureau today projected the U.S. population will reach 341,145,670 at midnight EST on 1 January 2025. This represents an increase of 2,640,171 (0.78%) from 1 January 2024, and up 9,696,329 (2.93%) since Census Day (April 1) 2020.” Now you know something few others do!

Will 2025 MH Production Surpass 2024?

It’s fairly certain 100,000+ new HUD-Code manufactured homes will be produced by year end 2024; the first time since years 2021 & 2022. Hopefully that momentum will carry us over into year 2025.  To that end MH aficionados should reread Harvard University’s Joint Center for Housing Studies report that debuted on 23 January 2024, titled: ‘Five Barriers to Greater Use of Manufactured Housing for Entry-Level Homeownership’, by Chris Herbert.

“The sharp rise in home prices and interest rates over the last few years has pushed homeownership out of reach for millions of renters. Under these conditions it is more important than ever that affordable homes are available for entry-level homeownership. Thanks to lower production costs; indeed, the construction cost of a basic single-section manufactured home is roughly 35 percent that of a comparable site-built home. While the savings for larger homes is smaller, it is till significant, with a double-section home costing 60 percent, and a CrossMod™ home (which most closely resembles site-built housing) costing 73 percent of comparable site-built homes.”

“Despite these savings, manufactured housing production remains depressed. During the 1980s and 1990s, more than 250,000 homes were produced on average each year, amounting to 25 percent of the volume of single-family construction. In recent years manufactured home production has just topped 100,000 units annually, about 10 percent of the volume of new single-family homes.”

“Given the cost advantages and unmet need for more entry-level housing, why has production of these homes remained so low?” – and what needs to be done to address said barriers?

Well, that’s what Harvard’s JCHS report purports to do; but first a couple comments on the quoted paragraphs above:

• Once again MHI’s CrossMods™ design is hinted to be an answer to HUD-Code housing’s production slump of the past 14 years (i.e. since industry’s nadir year 2009, of only 48,789 new homes produced). However, with CrossMod™ production totals being so difficult to ascertain, one wonders just how much of an ‘answer’ this new design is?

• When one pens a line referencing MH production between ‘1980s & 1990s’, insiders wonder: ‘Just how much does this writer know about ‘what really happened’ before and right after 1998, when sloppy MH sales and finance shenanigans were commonplace?’

Without further ado, here’re the five key barriers Harvard’s JCHS identifies for relative to MH production.

Negative Perceptions of Manufactured Home Quality. “Older manufactured homes (specifically pre-1974) were of poor quality and limited aesthetic appeal, and serve as basis of popular conception. However, newer homes are of much higher quality, with multi-section homes often indistinguishable from site-built housing.” I’d add here that the absence of a brick exterior veneer, as well as gutters and downspouts, add to this misconception. “Further, studies have found that when the home and land on which it is sited are jointly-owned, these homes appreciate (in value) at rates very close to site-built housing.” Again, all true enough, but it’s these price margins and degrees of ownership that contribute to the eminently affordable nature of HUD-Code manufactured homes ‘in & out of’ land lease communities. (Lightly edited. GFA) GFA) What would YOU do, if anything, to address this perception barrier?

Restrictive Zoning and Land Use Regulation. “Manufactured homes are often prohibited in zones set aside for single-family housing absent a special permit. State laws preventing the outfight exclusion of manufactured housing can help, but these laws typically do not address  design restrictions that are important barriers, including roof pitch, cladding, foundation heights, lot sizes, and setback requirements.*1 “…a statistically significant association with stricter regulation and a lower likelihood of any (manufactured) homes being sited in a community.” With that said, how to convince conventional homebuyers, paying mortgages on $500,000 houses, to welcome new manufactured homes valued around $200,000 into their neighborhoods – and not be concerned about reducing the value of their housing investment? What would YOU do, if anything, to address this land use barrier?

Market Conditions. While strict land regulation generally results in fewer manufactured homes, this barrier can be – and has been, offset by the trifecta of lower land costs, lower density development, and lower household incomes! So, favorable market conditions like these can encourage a shift from NIMBY to YIMBY attitudes.*2 What would YOU do, if anything, to ameliorate these market conditions?

A Unique and Limited Supply Chain. Manufactured homes are often purchased from independent (street) MHRetailers, before or after they’ve found land of their own – whether scattered building sites conveyed fee simple, or rental homesites within land lease communities.*3 In the former instance homebuyers obtain real estate-secured financing (i.e. conventional finance) or, in the latter instance, as homebuyers/site lessees, obtain chattel or personal property loans, a.k.a. ‘home only’ loans. Another limiting factor in the supply chain has been the location of factories. At the turn of the century there were more than 300 plants, today only 140 . “And factories need to be located within 500 miles of the home site to manage transportation costs.” To this end, the SECO team in Atlanta, GA., has created the ShowSearch telephone app, providing such key information to prospective MH homebuyers!*4 What would YOU do to address these unique and limited supply chain issues?

Access to Mortgage Financing. “A final constraint is the difficulty homebuyers face in accessing mortgage financing.” (This barrier was touched on in the previous paragraph). “Manufactured homes are generally considered personal property unless owners take steps to change the legal designation to real property, which is necessary in order to be eligible for mortgage financing.” Furthermore, “the titling process differs by state, and can be complex and time consuming, requiring the home be permanently affixed to a foundation.” However, “if the home is personal property it must use ‘chattel’ loans that bear higher interest rates and have shorter loan terms which can erode the home’s cost advantages.” And frankly, it’s more difficult to obtain chattel loans for manufactured homes. What would YOU do to address this uncertain access to mortgage financing?

One area that has been receiving increasing attention of late, relative to maximizing the “cost advantages and affordable homeownership opportunities offered by manufactured housing”, has been the role public and nonprofit sectors could play in overcoming some of the aforementioned barriers. What are your thoughts to this end?

I hope some or all this motivates you to consider existent and new ways to address five production barriers to selling and siting more HUD-Code manufactured homes nationwide. To this end, please communicate your ideas and suggestions to me via gfa7156@aol.com

End Notes.

1. Cladding = ‘metal bonded to an inner core of another metal.’ Maybe exterior veneer siding?

• NIMBY = Not in my back yard! & YIMBY = Yes, in my back yard!

• Independent (street) MHRetailer is a trade term coined by MH industry consultant William Carr of Iowa. And, since roughly 2009, land lease community owners/operators, recognizing the paucity of independent (street) MHRetailers, started aggressively marketing, selling, and oft financing new manufactured home transactions on-site within land lease communities.

• For more information, visit SECOconference.com  And know the SECO team also hosts periodic MH2X one day seminars that teach community owners/operators how to market and sell new manufactured homes onsite. The goal of MH2X is to help the HUD-Code manufactured housing industry to double annual production during year 2025!

Postscript. If you’ve read this blog carefully, you see that initiatives originating with the SECO team are 100% manufactured housing industry focused! The ShowSearch telephone application is nothing sort of revolutionary where sourcing new HUD-Code housing is concerned – specifically, a new digital means identifying factory sources of new HUD-Code homes nearby! And the MH2X program’s one day seminars exist nowhere else in the U.S. If you haven’t attended one to date, plan to do so during year 2025! Bottom line? As revolutionary as these two new tools are, you’re only hearing about them here. Why? Because, like other supposed advances in the MH industry (e.g. MHI’s CrossMod™ home design), if it does not originate in a certain manner, it receives scant attention from ‘powers that be’ in this industry.  So, reach out now via SECOconference.com and learn all you can about the ShowSearch phone app, the next MH2X program session, and date of the next national SECO Conference during fall 2025. Also know SECO principals will be present at the Louisville MHShow 15-17 January. If you don’t know them personally, look me up at the show and I’ll be pleased introduce you! GFA

George Allen