Blog Posting # 879; Copyright 1 July 2026. EducateMHC
Know This! HUD-Code manufactured housing (‘MH’) is federally-regulated, performance-based, affordable-attainable, factory-built housing (a.k.a. one of four types of offsite construction: those being manufactured, modular & panelized housing, plus accessory dwelling units/ADUs, e.g. Park Model RVs & Tiny Houses), routinely paired with traditional stick-built, single-family residential housing (a.k.a. onsite construction, where building permits, starts & completions are tallied and reported monthly by the U.S. Census Bureau). Land lease communities (a.k.a. manufactured home communities, ‘mobile home parks’) are the commercial real estate (‘CRE’) component of MH. Along with various types of housing finance (e.g. chattel or ‘home only’ loans, and real estate-secured mortgages) constitute the post-production segment of the MH Industry.
EducateMHC is an MH historian, trade term and trend tracker, as well as MH information resource! Contact EducateMHC via 9317) 881-3815; email: gfa7156@aol.com, or via www.educatemhc.com, to purchase ‘Community Management in the Manufactured Housing Industry’’. This book belongs in every land lease community nationwide! And, ‘SWAN SONG’ – a 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 40 year entrepreneur business career in MH & community ownership, as well as freelance consulting and authoring of 20 nonfiction texts.
George Allen is the sole emeritus member of the Manufactured Housing Institute (“MHI’), a founding board member of MHI’s National Communities Council (“NCC’) division, an RV/MH Hall of Fam enshrinee, Allen Legacy columnist and editor at large for ‘MHInsider’ magazine.
‘UPSIDE DOWN in a Mobilehome Park’, Part II
MH History is Repeating Itself 26 Years Later…
Penned as a blog posting during year 2000, then revived 17 years later and published as an informative Figure in SWAN SONG, a ‘History of Land Lease Communities in the U.S’, this expose’ captured the nefarious nature and absurdity of financial abuse oft suffered by buyers of HUD-Code manufactured homes at the turn of the century.
‘UPSIDE DOWN in a Mobilehome Park’, was introduced as a film title available in local video rental stores, and ‘…describes an upscale land lease MH community with new multisection manufactured homes already installed on-site.” Then, how fictional “…George & Carolyn, (bought) their first home (from) H. ‘Itch’ Balle, the local retail sales center salesman/manager.”
The nature of their ‘deal’ involved a $4,000 move-in incentive offer on an $80,000 multisection home already sited but not landscaped. Given the requirement for a $4,500 down payment – but with the couple having only $500.00, “… the $4,000 move-in incentive was graciously applied by the retailer/developer to improve their homesite with shrubs, porch and carpet.” Then this amount was added to the balance they were financing.
The rest of the financing arrangements? “Mr. Balle arranged for them to avoid paying ‘10% over 30 years (terms that’d have meant $733.13/month payments)’, gets them a variable rate loan of only 9% over 30 years’ with maximum possible increase of 2% (or two points) after one year. Their first year rate was only $672.18/month on their new home mortgage.”
“And the Good News did not stop there! ‘Itch’ announced the entire first year’s site rent of $285.00/month would be waived if they signed the sales contract that very day!” So they avoided the down payment, lowered their monthly mortgage payment, and saved a year’s worth ($3,430) of rent!!!
So, how did they get ‘upside down’? Simple. Carolyn became pregnant, losing a needed source of income, and they’d bought a new car. Plus, they now have a site rent bill of $285/month, a loan payment that ballooned to almost $800.00/month, not enough income to come close to covering these commitments. Consequences? Tens of thousands of homeowners/site lessees lost their homes at the turn of the century, and the MH industry is still without ready access to chattel capital or ‘home only’ loans, and suffers a much-bruised reputation!
That’s how the video ‘UPSIDE DOWN in a Mobilehome Park’ – Part I ended. Now fast forward to year 2026 for Part II – another sorry scenario foisted on an increasing number of naïve, some say victimized, manufactured home owners/site lessees living in (usually) larger land lease communities.
In this scenario, homeowners/site lessees are already living happily in the land lease community of their choice. They’ve bought and financed their manufactured home in a manner that makes good financial sense, where income and household expenses are concerned.
Now, along comes a private equity firm that’s ‘discovered’ how land lease communities, of a certain size (i.e. investment grade) make ideal realty investments: pre-acquisition site rate rents are usually low, in-place homes are far too expensive to relocate, and – frankly – there’s nowhere to move said homes in the local housing market. And selling developer/owners are almost always willing to sell-out if the offer is high enough. So, the investment transaction is consummated.
Then the new property owner/operator (i.e. usually a private equity firm, a.k.a. ‘consolidator’) raises site rents to cover the inordinate purchase price it took to acquire the income-producing property. Also engages in other maneuvers to increase cash flow, e.g. begin charging for services previously included in the site rent, and more.
The heretofore happy homeowners/site lessees, suffering these new fees, are now very unhappy, trapped, even ‘UPSIDE DOWN in their Mobilehome Park! Their incomes are oft ‘set’ by retirement, they don’t have thousands of dollars to relocate their manufactured home, and there’s rarely a land lease community within 50 miles in which to move their home.
One of many consequences of this sad state of affairs is how differently land lease communities are now valued. Historically, land lease community site rent was one third the amount of a 3BR2B garden style apartment in the same local housing market. Given the above scenario, however, that long-standing Rule of Thumb changed the average site rent to fully half the apartment rent rate. Another clear example of affordable housing no longer being affordable!
What to do? 50 years ago, when syndicators skewed local housing markets, rent-wise, other nearby community owners/operators would often meet privately with offending parties and encourage them to ameliorate local economic impact. And it worked. – back then.
Today? Hard to say. While there are rumors of pending state-level rent control legislation, little has been done to date. Worse than that, trade entities, where one might expect peer and social pressure and action, have been slow to get involved. After all, the offending property owners are the ones paying state and national association membership dues.
Everyone knows of the affordable housing crisis in the U.S. today, but the rising prices of new manufactured homes and related community lifestyle (i.e. influenced by rental homesite rent rate), threatens to keep HUD-Code housing production, due to reduced sales volume, at an anemic 100,000/ year level for the near and interim future.*1
If you have thoughts on this timely and lively subject that you’d like to communicate with me, do so via gfa7156@aol.com
End Note.
- HUD-Code manufactured housing annual MH production rates of note: 1998 = 372,943; 2009 = 48,789 MH industry’s nadir (lowest) year ever; and, 2025 = 102,738. These figures courtesy of the Institute for Business Technology and Safety (‘IBTS’).
George Allen