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

Blog # 237 Copyright 2013 17 March 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

I.

The NEW NORMAL! 50,000 New HUD Homes Shipped per Year

II.

‘REAL HOMES, REAL VALUE’, How Outsiders Look at Us!

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I.

The NEW NORMAL! 50,000 New HUD Homes Shipped per Year

(54,881 new HUD – Code Manufactured Homes Shipped During Year 2012)

Yes, you read that right! As an industry, we’ve been bouncing along this ‘new home shipment nadir’ for so long, folk now entering factory – built housing and its’ related realty component, increasingly view ’50,000+/- new HUD – Code homes shipped per year’, as the New Normal for manufactured housing production and sales. *1

Harkening way back to year 1972, when a record number 575,940 new ‘mobile homes’ were shipped; then year 1998 – our latest, too brief renascence – when 372,943 new manufactured homes were delivered, it’s obvious that while 50,000+/- new home shipments per year was NOT ‘the norm’ in the distant past, after five years of limping along, the figure is likely our par going forward. *2

Frankly, this growing contemporary nadir, or New Normal, view of manufactured housing production and shipments has become, and will continue to be, increasingly entrenched in our collective mindset – the longer the following perennial mal conditions remain unaddressed and unchanged:

• While chattel (personal property) capital, for mortgages on manufactured homes sited within land lease lifestyle communities, is available from independent, third party lenders and some local banks, it must be more accessible by prospective homebuyers/site lessees; OR, the quality (i.e. credit worthiness) of would – be homebuyers/site lessees must markedly improve! Do you see either or both these changes occurring anytime soon? Neither do I.

• Counting new home ‘shipments’ rather than new home ‘sales’. As long as HUD – Code home manufacturers continue to operate from this wholly ‘production priority’ (versus ‘marketing sensitivity’) perspective, we’ll continue to see new homes delivered into local housing markets that, based on Area Median Income or AMI, cannot afford them; that don’t want them, e.g. into markets saturated with site – built homes in foreclosure; and, their continuing insensitivity to the genuine housing needs and wants of local prospective homebuyers.

• Decide once and for all, whether HUD – Code manufactured housing is ‘affordable housing’ OR an apt competitor in enough local site – built housing markets to ensure sufficient ‘home sales cum shipments’ – or is it the other way around: ‘home shipments cum sales’? See the difference? I surely hope so. In the meantime, continue to expect to see far more ‘big box = big bucks’ manufactured homes at regional housing trade shows in Louisville and Tunica, rather than Community Series Homes or CSH models, with durability – enhancing features, designed for in – LLLCommunity infill, on functionally obsolete and full size rental homesites. At the very least, understand and agree – industry wide – what it means for housing to be ‘affordable’ in the first place; then, if and when possible, get our federal regulator, HUD, to finally begin promoting manufactured housing as the affordable housing option it is!*3

• Then there’re the ever present ‘elephant in the room’ concerns. *4 Whether a) ‘not talking’ about rental homesite rates being way out of sync with other forms of multifamily rental housing in the same local housing market; b) chattel lenders’ practice of including PITI only, within the commonly accepted 30% Housing Expense Factor – omitting routine household expenses; c) how after 60 years in business, there’s still no ‘secondary market’ for the valuation, listing, and sale of manufactured housing, particularly those sited within LLLCommunities; and of late, d) an emerging, unfortunate repeat of manufactured housing history, circa 1985, where larger firms – first, the mega home manufacturers, and today apparently, a few of the largest property portfolio owners/operators, who’re members of a national advocacy body, publicly and privately bullying smaller firm businessmen and women. *5

With that said, understand there’re two major matters to address here and going forward:

1. How to reverse the growing ‘nadir view’ of HUD – Code manufactured housing; where 50,000+/- new homes shipped per year is now viewed as the New Normal? It won’t be an easy process.

As preview, it’ll take a) leadership capable, industry experienced, highly motivated individuals, willing to listen to and understand their peers, via one or more national strategic brainstorming sessions – open to everyone willing to ‘pay the price to attend’; b) charting a realistic return to greater productivity and profitability via better and creative financing, with a marketing and sales perspective, under – girded by new respect for housing affordability, and,

2. How to effectively address most or all ‘elephant in the room ‘ concerns? Here too, this will not be an easy process.

In fact, with the exception of the final ‘elephant’ of the four – being a relatively recent arrival on the national manufactured housing scene, the other three matters are perennial bugaboos to everyone in the factory – built housing business. Three examples: 1) Are specific land lease lifestyle community owners/operators, charging rental homesite rents out of sync with other forms of multifamily rental housing, in their local housing markets, prepared to roll back their rates? I seriously doubt it. 2) Are independent, third party and on – site, self – finance chattel lenders prepared to make homeowner loans more affordable (i.e. ‘less risky’), by adding routine housing expenses to the PITI $ already within the 30% Housing Expense Factor? I think not. And, 3) after 60+/- years are we, as a housing alternative industry, prepared to create, grow and support a secondary market for the valuation, marketing, and sale of used manufactured homes – so that we can sell more new homes? Nope. And as far as that ‘fourth elephant’ is concerned, let’s hope saner minds prevail in the near future, so we don’t wind up with an even more diverse and divisive national representation relative to political and regulatory Advocacy, statistical Research, and comprehensive Resource servicing – especially where land lease lifestyle community owners/operators are concerned!

But given the circumstances and challenges just described, is there willingness and commitment to ‘change and improve’, to and for the greater good of all involved in manufactured housing and the land lease lifestyle community realty asset class? Again, I think not.

Not mentioning any names here, but today there are no fewer than five national, not for profit entities vying for the dues money and loyalty of individuals and firms associated with HUD – Code manufactured housing and or its’ real estate component, the land lease lifestyle community asset class. Print off this blog posting and send it to the elected and salaried leaders of the trade group or groups with whom you affiliate, and ASK: 1) Do they agree or disagree with the concerns set forth in the previous paragraphs, then ask, ‘WHY?’ Then, 2) What are, or will they be doing about these and related matters, from their perspective, during the remaining months of year 2013? Anything you’re told, short of a specific and timed Action Plan, is their clear vote to continue this status quo; being,

’50,000 new HUD – Code homes per year as the New Normal for the entire manufactured housing industry’!

Is that what YOU want to hear, and where you want to lend your support? I hope not!

In either event, I’d like to know your thoughts on some or all these identified concerns playing important parts in keeping HUD – Code manufactured housing at its’ five year new home shipment nadir! Either our elected and salaried leaders should be taking steps to get us out of this malaise, or we need to reorganize and do it ourselves, with the help of new business associates!

Write to me: GFA c/o Box # 47024, Indianapolis, IN. 46247 or phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

II.

‘REAL HOMES, REAL VAUE’. How Outsiders Look at Us!

(How the Corporation for Enterprise Development, or CFED, views the value appraisal of manufactured housing sited on parcels of real estate owned fee simple; and, why land lease lifestyle community – sited homes should be appraised similarly….)

If you’re on LinkedIn, and have been following the lively discussion leading up to the CFED – hosted Webinar on 28 March, you know there’s a ‘recent report’ cited as seminal to the upcoming presentation. It’s titled, ‘REAL HOMES, REAL VALUE’. I’ve read it cover to cover, but there’s no way I can do the 50 page report justice in a few paragraphs. But I will point out some of the highlights that caught my attention.

• Among 31 individuals acknowledged as resources for this report, eight are affiliated with manufactured housing; but NONE are owners/operators of land lease lifestyle communities: Joan Brown, Steve Hullibarger, Don Miner, Dan Rinzema, Betty Whittaker, Paul Bradley, Emanuel levy, and George Porter.

• Early on, author Robin LeBaron acknowledges report’s focus being “…the practices of appraising manufactured homes as real estate….” P.5. But by default, he hints at interest in valuation issues pertaining to manufactured homes sited in land lease lifestyle communities. “In 2008, approximately two – thirds of manufactured homes placed in the US were titled as personal property, and one – third as real property.” P.13. Leading to a recommendation, later in the report: “Encourage states to adopt the Uniform Manufactured Housing Act as a means of standardizing the process of recording the conversion of title from personal to real property (Within land lease lifestyle communities and elsewhere. GFA), and vice versa.” P.39. *6

• In the Executive Summary, the author calls for ‘terminological clarity’ relative to differentiation among factory – built housing types. That work has already been done. All he had to do was cite Don Carlson’s decades long demarcations, based on national housing market share, per production (site) builders @ 45% (Who routinely use pre – hung window and door components, as well as roof trusses and floor/ceiling joists); panelizers @ 45%; modular housing @ 5%; and HUD – Code manufactured housing @ 5%. Courtesy, ‘Automated Builder’ magazine.

• “Only one state, New Hampshire, automatically titles all manufactured homes as real property.”

• “Six differences between manufactured and site – built homes…relative mobility or immobility, design and structural quality, external appearance, finishes, perception and tenure.” P.22 Actually, the final ‘difference’ would have been better cited as ‘tenancy’ (‘holding property by lease or rent’) rather than tenure (‘the holding of something, as property or office….’), since the author points out, on page 27, “…one – third of manufactured homes are located on land that is not owned by the homeowner (“fee simple” ownership of the land and home), but leased from a third – party, typically in a manufactured home community.”

• “A perimeter foundation, for example, must be perfectly sized to accommodate a manufactured home without generating future problems.” P.24. No question, but what dimension and integrity of the perimeter wall are important; but it is not weight bearing, as the mass and weight of a manufactured home is borne by the steel carriage or frame under the home, onto piers located under said home and not the perimeter wall!

• Another recommendation in the report, calls for “…standardization of the definitions and terminology related to manufactured housing….” An example of outsiders being unaware of resources already widely available to them. The Official Glossary or Lexicon of the manufactured housing industry and land lease lifestyle community asset class has been around now for more than three years, with latest edition published as Appendix III in the 2012 ‘Book of Formulae, Rules of Thumb & Helpful Measures’. See end note # 3.

Interested in obtaining a copy of this report to read for yourself, and maybe prepare to participate in the free Webinar, on this subject, at 2:30PM on 28 March 2013? Do what I did. Google CFED and make a direct inquiry for ‘REAL HOMES, REAL VALUE’; and while you’re at it, ask for Webinar ‘sign up’ instructions.

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End Notes.

1. nadir: ‘the lowest point’ Webster

2. Year 2011 = 51,055 homes; 2010 = 50,046 homes; & 2009 = 49,789 homes

3. Read chapter # 5 in Book of Formulae, Rules of Thumb, & Helpful Measures, available for $19.95 from PMN Publishing. MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

4. ‘elephant in the room’ = English metaphorical idiom for an obvious truth that is either being ignored or going unaddressed.’ Wikipedia

5. PITI = loan principal & interest; pro rata personal property or real estate taxes & homeowners’ insurance premium

6. The Uniform Manufactured Housing Act adopted in July 2013 by the Uniform Law Commission

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George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

Blog # 236 Copyright 2013 10 March 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

I.

22nd annual Networking Roundtable to Emphasize Close Cooperation Between Land Lease Lifestyle Community Owners/operators & HUD – Code Home Manufacturers!

II.

HUD Acknowledges Affordable Housing Shortage in the U.S., but Fails to ‘Look Within’ and See Manufactured Housing as Answer!

III.

Readying for Competition & Tweaking Revenue Sources

IV.

Planning for Disaster

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I.

22nd annual Networking Roundtable to Emphasize Close Cooperation Between Land Lease Lifestyle Community Owners/operators & HUD – Code Home Manufacturers!

(Originally scheduled to debut @ 7:30 – 8:45AM on 18 April, at MHI’s congress in Las Vegas, but now canceled, this much – needed, new home shipment catalyst, will now be center stage during the 22nd annual Networking Roundtable in September 2013!)

On 4 March 2013, a letter went out to all Business Development Managers, or BDMs, working for HUD – Code home manufacturers throughout the U.S. The correspondence described a new, three – pronged MHInitiative® designed to pick up where the last National State of the Asset Class (‘NSAC’) caucus, on 27 February 2009, left off. MHIndustry veterans will recall how the day long meeting at the RV/MH Heritage Foundation’s Hall of Fame, Museum & Library facility, spawned the popular Community Series Home, or CSH Model, now relatively commonplace among HUD – Code home manufacturers and land lease lifestyle communities.

Since then, the NSAC caucus movement has been relabeled as MHInitiative®; whereby many HUD – Code manufacturers now routinely design, build and ship CSH Model homes; and virtually all LLLCommunities, with more than 100 rental homesites, now sell, self – finance, and or lease homes on – site, to fill their share of an estimated 250,000 vacant sites located throughout the U.S. But there’s still room for improvement, in both the manufacturer/LLLCommunity relationship, and the methodology of marketing and selling new, even resale manufactured homes. Hence this expanded, three – pronged MHInitiative®, targeting:

• All HUD – Code home manufacturers desiring to sell more new homes into LLLCommunities!

• All land lease lifestyle community owners/operators buying/selling/renting, and oft times self – financing new homes on – site!

• All land lease lifestyle community owners/operators buying/selling/renting resale homes on – site, and or leasing rental homesites!

Not one of these three parts of the expanded MHInitiative® is self – exclusive! They interrelate to the extent that HUD – Code home manufacturers AND land lease lifestyle community owners/operators decide to overtly work together, cooperating to market, sell, lease, and when need be, self – finance new, even resale homes on – site, within these unique, income – producing properties! And in most cases, throughout the U.S., this novel Business Plan is effected, unfortunately, sans participation by independent ‘street’ MHRetailers, and with no secondary market for selling – off ‘used’ manufactured homes.

Achieving this ‘new level of intra – segment cooperation, or team building’, is what had been hoped for during the congress next month. But that opportunity has been ‘kicked down the road’ to September – and that’s probably a ‘good thing’ for these reasons: 1) There are still several training aids to prepare; and now with the added time, 2) recruit additional presenters to focus their expertise on the tripartite task at hand. The training aids? At least four exciting ones to date:

• Virtually everyone in the MHIndustry & LLLCommunity asset class is already aware of, if not routinely using, the strangely – named, but highly useful ‘Ah Ha! & Uh Oh! Worksheet’. *1 But what most folk don’t realize is this four perspective Housing Price Point Estimation Tool is functional as a Spread Sheet. And that application will be introduced and made accessible to all, at the 22nd annual Networking Roundtable this Fall.

• The first of two 3”X5” plastic cards, printed both sides, will feature using the ‘5 – RPs of Marketing’ to market and sell new, HUD – Code homes INTO land lease lifestyle communities. To the best of this writer’s knowledge, never before have HUD – Code home manufacturers cooperated, via their Business Development Managers, to produce a Training Aid of this nature, to this practical end! Once and for all, ‘Here’s How to do it!’ What could be more exciting than cooperating together on such a worthy, and certainly timely, project?!

• The second of two 3”X5” plastic cards, printed both sides, will feature two distinctly different, but related uses of the ‘5 – RPs of Marketing’: to 1) market and sell new homes WITHIN land lease lifestyle communities; and 2) market and sell resale, and or rental homes, WITHIN this property type, as well as lease vacant rental homesites! And like the ‘manufacturers’ card described in the previous paragraph, these two will contain the best thinking, based on successful on – site experience, of owners/operators already engaged in these procedures!

And capable, experienced, motivated presenters willing to focus and share their expertise in these three areas? Well, if you believe you’re One of Them, please get in touch with me via this website, mail: GFA c/o Box # 47024, Indianapolis, IN. 46247. or otherwise.*1 For that matter, if you own/operate a LLLCommunity, and or supply products and services (e.g. mortgage origination) to this property type, and would like to be invited to this year’s ‘by invitation only’ 22nd annual Networking Roundtable, NOW is not too early to say so!

And know I’ll be present at the aforementioned congress, in April, if you’d like to discuss this new, enhanced shipment volume MHInitiative®, between HUD – Code home manufacturers AND land lease lifestyle community owners/operators! It’s likely most Networking Roundtable ‘presenter’ positions will be filled by then, but Your Ideas are indeed Welcome!

II.

HUD Acknowledges Affordable Housing Shortage in the U.S., but Fails to ‘Look Within’ & See Manufactured Housing as Answer!

Remember blog posting # 232, of a few weeks ago, featuring this ‘in your face challenge’: Hey HUD! Help Out! ? Well, according to a recently released document titled: ‘Worst Case Housing Needs 2011: A Summary Report to Congress’, HUD’s 2011 American Housing Survey conducted by the U.S. Census Bureau, between May & September 2011, “…the number of ‘Worst Case Housing Needs’ continued to grow from the previous record high, in 2009 (7.1 million households) by a striking 43.5 percent since 2007.” This means “8.5 million households paid more than half their income for rent or lived in substandard housing.”

What will it take to get HUD to realize and promote manufactured housing as the most reasonable answer to our nation’s affordable housing crisis – as just described in the previous paragraph? At least the Manufactured Housing Association for Regulatory Reform, or MHARR, is trying to do so! The following is quoted from their Press Release dated 26 February 2013:

“…MHARR has pointed out, in congressional oversight hearing and other
interactions with government decision – makers, notwithstanding such growing
‘critical needs’ and mandate of the Manufactured Housing Improvement Act of
2000 (a.k.a. MHIA@2000), the HUD program (should) ‘facilitate the acceptance
of the quality, durability, safety and affordability of manufactured housing within
the Department’.”

If you’re not already on MHARR’s mailing list to receive strategic information such as this, phone (202) 783-4087.

III.

Readying for Competition & Tweaking Revenue Sources

Let’s leave it this way: If you’re a direct, dues – paying member of the Manufactured Housing Institute, and were not in attendance at the institute’s recent (February 25 & 26) annual Legislative Conference and Winter Meeting, it’s likely you haven’t seen and or read a copy of the proposed changes to MHI’s present bylaws. No commentary here, yet; just a friendly suggestion you phone Richard Jennison via (703) 558-0678, and, as a direct, dues – paying member of the institute, request a copy of the marked – up set of bylaws; to review, and about which, to form your own opinion(s) pro and con, before their annual meeting, October 2013.

IV.

Planning for Disaster!

In a recent blog posting, it was described how some land lease lifestyle community owners/operators are searching for guidelines and more, to help them better prepare, ahead of time, for disasters that might strike their properties! Besides the resources suggested in that blog posting, Jay Zandman of the Manning & Nozick Insurance Agency informed this web site his firm has such resources ‘available for the asking’. So, phone Jay via (770) 393-8311 X 117, and tell him ‘Hey Jay, George Sent me!’

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End Notes.

1. ‘Ah Ha! & Uh Oh! Worksheet’ available FREE by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.
***

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

Blog # 235 Copyright 2013 3 March 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

I.

A Land Lease Lifestyle Community Contretemps?

II.

Removable Chassis Prompts Excitement & Questions

III.

‘Circling the Drain’ or Readying for Resurgence?

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I.

A Land Lease Lifestyle Community Contretemps?

‘Yet Another Day (2/25/2013) likely to go down in MHIndustry History!’

On the very same day, 25 February 2013, two separate meetings, among land lease lifestyle community owners/operators, occurred in the neighboring cities of Arlington and Alexandria, Virginia.

In the first instance, the National Communities Council (‘NCC’) division’s executive committee, along with invited guests, met in a closed door planning session, in lieu of the council’s usual biannual meeting, to – in the words of one participant sharing afterwards – ‘Rethink the whole NCC thing and what we should be doing.’ That’s OK for the time being. However, proceedings from this meeting were not even mentioned at the full MHI board meeting the following day, so NCC members must wait and see, or listen for, further enlightenment, if and when it comes….

In the second instance, a small group of land lease lifestyle community owners/operators convened, elsewhere, to review the ‘State of the MHIndustry & LLLCommunity Asset Class today’; ‘How to Maximize ROI via AITR at their properties’ (See end note *1); and, as it turned out, parse the major asset class issue of the day: Need to identify contemporary and new sources of chattel finance pursuant to the self – financing of new and resale homes on – site!

What was accomplished in this latter instance? Following a brief discussion of present day programs (See end note *2), the morning turned creative, as B2P and P2P ‘crowd funding’; creative home finance and ownership partnerships between investors and REITs and other property portfolio owners/operators; and, the need to create a new nationwide ‘manufactured housing’ bank, were discussed at length. End result? The formation of a Task Force, to focus on popularizing the aforementioned sources, and identifying new $ for funding the on – site sale of new and resale manufactured homes within land lease lifestyle communities. If you’d like to participate in this process, contact Spencer Roane, MHM® via spencer@roane.com Serious inquiries only, please.

II.

Removable Chassis Prompts Excitement & Questions

Here’s what one blog flogger (reader) had to say after reading about the possible re – emergence of the removable chassis as an added option to the line of home designs available from HUD – Code home manufacturers:

“I liked your Sunday blog. I liked how you drew on history (i.e. the failed 1990 effort to approve the removable chassis measure to boost HUD – Code housing production) to present day issues (i.e. Again, ‘boost HUD – Code housing production’) for others to move to meaningful solutions!” SL

The latter part of that quote has to do with Advocacy efforts, on the part of the Manufactured Housing Association for Regulatory Reform (‘MHARR’) and the Manufactured Housing Institute (‘MHI’), to advance the removable chassis measure forward successfully, this time around!

So, what’s happening? The removable chassis possibility continues to move forward. As there are worthwhile advances to report, you’ll read about them here; so, as they say in radio, ‘Stay tuned!’

III.

‘Circling the Drain’ or Readying for Resurgence?

Editorial Posture. Everyone likes it when this blog presents – as it has during the past two weeks – clear, succinct recitations of industry issues and trends; as well as HOW TO information useful to land lease lifestyle community owners/operators. On the other hand, when circumstances appear ripe for critique, constructive and otherwise, your responses – while just as frequent, wax supportive and nay saying in near equal measure. Well, circumstances this past week, prompt the following op/ed reporting…

Before I left Indianapolis, to travel East on a week long business trip, lunching and dining with nearly a dozen business associates and clients along the way, one MHIndustry veteran, and former MHI member, opined relative to MHI’s annual Legislative Conference & Winter Meeting, it’d be akin to our industry continuing to ‘Circle the Drain!’

Ouch! But was he right or wrong? While I hope(d) ‘the latter’, it’s difficult – for the following reasons – not to fear the former. (That he’s right).

First the numbers. According to the distributed Registration List, there were 94 individuals in attendance (That’s fewer than number present at MHI’s annual meeting in San Antonio, TX., last Fall), but 13+/- of these were former legislators, governors, and lobbyists. So, of the 81+/- remaining, the best represented group present, at 16+/- , were state MHAssociation executives; then (somewhat surprisingly) 15+/- mostly chattel finance – related attendees (But tellingly, not a single LLLCommunity – focused real estate mortgage originator!); then 14+/- LLLCommunity owners/operators from 13 different firms; and (also surprisingly), 13+/- HUD – Code home manufacturers representing about eight firms. Altogether, those four segments accounted for 58 of the aforementioned 81 industry registrants. And when you subtract the 16+/- MHAssociation executives, from among the 58 subtotal, one is left with 42+/- actual business entities (i.e. Folk with bona fide ‘skin in the game’ of manufactured housing), or half the number present in toto. Not an impressive turnout for an industry struggling to survive.

Recalling the 20+ NCC members present, during the annual meeting ‘ambush’ last Fall; had all of them been present this time around (They weren’t, as their biannual scheduled membership meeting was pre empted by the aforementioned ‘closed planning session’), MHI would/could have had 100+ present for this meeting, something that hasn’t happened in quite some time.

Then the shocker. At Noon on Monday, 25 February 2013, MHI Chairman Don Glisson, Jr., of Triad Financial Services, Inc., resigned his elected position, allegedly for personal reasons. This is an unexpected, unneeded, and unwanted loss for the manufactured housing industry as a whole! Frankly, I suspect there’s more to the story than we’re being told, but I won’t go into that matter here at this time. In any event, Nathan Smith, of SSK Communities, succeeds Don Glisson as chairman of MHI.

Yes, there’s more that could be said, but you get the idea. Bottom line? It’s downright difficult to spark resurgence in an industry routinely attracting ‘less than 100 members and guests’ to biannual membership meetings; loses a good leader midstream; refuses to look beyond a limited Advocacy role and serve all its’ members’ (Not just home manufacturers) need for statistical Research and ongoing Resource services; and finally, not repeat the ‘lesson of 1985’, by catering to the few at the expense of the many (Lest you think I exaggerate by including this final point, take a close look at the proposed changes to MHI’s bylaws, before you decide….).

***

End Notes.

1. ROI: Return On &/or Of Ones’ Investment; &, AITR: ‘Alternative Income to Rent’ theory proposed by multifamily rental property consultant Allen Cymrot.

2. All present day national, super regional, and regional independent sources of chattel financing for manufactured housing, will be featured in the soon – to – be – released 15th annual National Registry of Real Estate & Chattel Lenders. To obtain your FREE copy of this ‘only such $ resource available today’, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and subscribe to the Allen Letter professional journal. The Registry will be distributed as a lagniappe in the March issue of the monthly newsletter.

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

Blog # 234 Copyright 2013 24 February 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

What Land Lease Lifestyle Community Owners Really Want!

The most insensitive thing land lease lifestyle community asset class’ elected leaders can do, is decide ‘on their own’ what their peers need and want – without soliciting their input, regarding contemporary issues and trends; and most important, what’s required to help them run their unique income – producing properties well!

What follows here, are responses from two separate, recent surveys of more than 600 owners/operators of land lease lifestyle communities and property portfolios. The sources? 24th annual ALLEN REPORT research, and POWER Networking Luncheon at the Louisville MHShow during January 2013.

I.

A detailed summary of the 14 MHIndustry & LLLCommunity issues identified by property owners/operators, during the research phase (Fall of 2012) of preparing the 24th annual ALLEN REPORT®, will be published as a signature Series Resource Document®, in the March 2013 issue of the Allen Letter professional journal. In the meantime, here’re the four major categories of issues, covering said 14 different topics:

• For a least the fifth year in a row, land lease lifestyle community owners and operators identified the ‘lack of new and resale home finance programs’ (Specifically, the inability of would be homebuyers to access chattel capital, due to low credit scores, bruised credit, etc.), as well as continued lack of access to government – insured finance programs, on – site, as perennial bugaboos.

• Hand in glove with the first ‘industry issue’, is the continually growing number of home finance regulatory measures and agencies (e.g. S.A.F.E. Act, Dodd – Frank legislation, CFPB, and more) requiring compliance by those selling/financing homes. And how many LLLCommunity owners/operators now embrace creative alternative means of financing and moving new move – ins into their property(ies)

• Not surprisingly, there’s the ongoing challenge to grow and maintain physical and economic occupancy within land lease lifestyle communities, as the third most prevalent issue among the owners/operators involved in this business model.

• And finally, a three way tie among 1) inability to find good quality, near new homes, to move on – site and sell or rent; 2) rising cost of new manufactured homes, including cost of site additions; and 3) government interference in business via rent controls, and other landlord-tenant measures.

Did you notice, while reading the above list, that while all issues’ are germane to the land lease lifestyle community realty asset class, they’re especially critical to the small to mid – sized owners/operators (i.e. one property owners and portfolio ‘players’ with maybe a half dozen or so smaller to mid – sized LLLCommunities). These being the folk who lack ‘economy of scale’ resources, mainly dollars, to deal with said issues internally, unlike the largest of the portfolio owners/operators, who’re routinely doing just that.

In any event, and with the above six MHIndustry & LLLCommunity ‘issues’ in mind, here’re practical recommendations as to how national leaders at 1) MHI’s National Communities Council (‘NCC’) division, and the 2) Manufactured Home Community Owners of America (‘MHCO’), can Best Serve land lease lifestyle community owner/operators nationwide:

• Once and for all, identify ALL existing, viable home finance programs in effect throughout the U.S. today, from identifying independent third party chattel capital firms (e.g. Commonly referred to as the ‘Big Four + 1’, maybe soon to be the ‘Big Five + 1’ *1); then, the various forms of ‘self – finance’ (e.g. formation of ‘captive finance’ entities), including the lease – option, even the popular contemporary practice of renting manufactured homes on – site; and more! There’s already one such chart in circulation, titled ‘Seller Finance Solutions’ – distributed as a lagniappe, in the January 2013 issue of the Allen Letter professional journal, along with the 24th annual ALLEN REPORT®. Did you get a copy of both documents? If not, the chart is available ‘for the asking’, by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. One thing that hasn’t happened yet, is the formation of a Task Force, comprised of LLLCommunity owners/operators to explore the exciting possibility (reality?) of using private investors via P2P (Peer to Peer) and B2P (Business to Peer), a.k.a. ‘crowd funding’, to finance LLLCommunity owners/operators’ acquisition of new manufactured homes for placement on – site in their properties. For LLLCommunity owners/operators not yet familiar with, or using this option, know Spencer Roane, MHM®, has been using this approach successfully, for more than a decade, and brought it to our asset class two years ago. Reach him via spencer@roane.com

• Home finance regulatory measures and agencies. Here, an easy to read, periodically updated compendium of appropriate information, is sorely needed. PMN Publishing prepared and distributed the Manufactured Housing $$$ Primer in 2010, and copies are still available for $19.95 apiece, via the MHIndustry HOTLINE. *1 And while an excellent ‘introduction to the subject’ of MHIndustry chattel finance, it does NOT cover the ubiquitous regulatory climate since 2010. That key and timely topic offers a unique Research & Resource opportunity for MHI’s NCC division; something that should and could be researched, then distributed – for a price, to all small to mid – sized owners of LLLCommunities, those not big enough to home – grown our own $ and compliance programs! Anyone out there listening? Let’s hope so!

• ‘How to improve and maintain physical and economic occupancy in a LLLCommunity during these trying economic times?!’ Now there’s a lively combination ripe for Joe Adams’ online marketing advice, George Allen’s Mystery Shopping Lessons Learned ‘on the phone’ and ‘during on – site personal interviews’, along with Michael Powers’ ‘How to Collect 100% of Your Site Rent 100% of the Time!’ Gee; do you think we’ll see that timely and heady ‘combo’ at the MHCongress this Spring? I doubt it, but we should! Hmm. Maybe at the 22nd annual International Networking Roundtable this Fall, in…

• And how ‘bout that potpourri third combination of slightly lesser issues ‘on the minds of LLLCommunity owners/operators’? Finding good quality, near new homes ‘for sale’ in one’s local housing market? Like finding pins in a haystack these days, but search the local ‘penny saver’ advertising tabloids! Rising cost of new manufactured homes? Maybe ‘break the comfortable mold’ and get familiar with other home manufacturers, especially their Community Series Homes or CSH models! And government interference in business matters, (e.g. rent control and failure to maintain lawsuits? That can be a toughie. Easier to confront before government gets involved, with local LLLCommunity owners joining together and visiting property owners charging exorbitant homesite rents.

Then there’s the plethora of topics requested/recommended by the 70 land lease lifestyle community owners/operators who participated in the historic POWER Networking Luncheon during the Louisville MHShow during January 3023. Anyone responsible for putting together educational programs for LLLCommunity owners/operators should be paying close attention right now:

• How to Effectively Upgrade Older LLLCommunities & Homes?’ Talk to Don Westphal, and order MHI’s book on the subject – if it’s still in print.

• What are ALL the New & Resale Home Finance Alternative Available Today? Hmm. This reads similar to the ‘need’ described earlier in this blog posting, challenging MHI’s NCC division ‘closed planning meeting’ of executive offers to Research and Resource such a document or chart to all LLLCommunity owners.

• Operations – related topics, like curb appeal, rules enforcement, rent collection, resident relations, etc.. All these, and more, are covered in Landlease Community Management, the frequently updated 1988 property management text basis of the Manufactured Housing Manager® or MHM® training and certification program. Both available from PMN Publishing via the MHIndustry HOTLINE….*1

• How to Buy a New Manufactured Home to resell On – site in my Property? It’s difficult to believe there are NO contemporary guidelines or books on this topic. I’ve challenged several HUD – Code home manufacturers to do so, but so far, ‘no takers’. Wonder why?

• How to Better Market my LLLCommunity Online & via Social Media? Know who needs to write this? Someone who ‘lives and works’ as an Occupancy Specialist for one or another of the large property portfolio owners/operators!

• On – site Home Sales 101 Class for LLLCommunity Managers! Same comment here as in the previous bullet point. Is there an Occupancy Specialist listening? If so, let me know of your interest and we’ll help you pen, print, and distribute such a tome!

• Preparing for Disaster! Is There a Model Guide Available? (Yes) Actually there are several, MHI published one ‘years ago’ (Still available?) Ask them.). And the Institute of Real Estate Management® also keeps one available on their publications list. Phone 9312) 329-6000 and request a copy of the publications list.

• How to Work with a Local MHRetailer to Put Homes into my Property? This used to be referred to, tongue in cheek, as ‘The Care & Feeding of MHRetailers!’ Still included in the aforementioned Landlease Community Management text; just not taught all that much during the past decade or so. Maybe start again?

• How to Value Manufactured Homes on – site in my Property? Here we’re caught betwixt and between. NADA methodology continues to be easiest to use, and is most prevalent, thanks to federal agency preference. However, manufactured housing, per se, will never truly be considered ‘conventional housing’ until valuation is routinely via market comparables, not book value.

• How to Calculate Affordable Price Points on New 7 Resale Manufactured Homes? Finally, after 60+ years, this ‘No longer a Mystery, but now a Methodology’, is in place and used throughout the U.S. If unfamiliar with it, phone the MHIndustry HOTLINE and request a FREE copy of the ‘Ah Ha! * Uh Oh! Worksheet’. *1

Don’t know ‘bout you, but that’s a downright interesting and challenging list of educational topics coming from land lease lifestyle community owners ‘with skin in the game’, and desirous of better positioning themselves to maximize the profitability of their unique, income – producing properties. So, is anyone else out there listening? I sure am. As I begin planning now, for the 22nd annual International Networking Roundtable, I’ll attempt to incorporate as many of the aforementioned topics into that, by coincidence, 22 topic programs.

Are there additional topics you’d like to see covered in September, at the next Networking Roundtable event? If so, let me know by mail: GFA c/o Box # 47024, Indianapolis, IN. 46247., or via email: gfa7156@aolc.om

Can’t wait eight months for helpful information like this? Then consider attending the 2nd annual SECO (Southeast Community Owners) Super Symposium in Atlanta, GA. later this Spring, or early Summer. For information, contact Spencer@roane.com I certainly plan to be present.

For that matter, it’s also a good idea to let Jenny Hodge, executive VP of MHI’s NCC division, know if these and other topics should be covered at one or another of her group’s functions during the months ahead: (703) 558-0666.

End Note.

1. For an up to date, inside look, at all 20 national, super regional, and regional independent chattel (personal property) lenders and their contact information, read the soon to be released 15th annual National Registry of Real Estate & Chattel Lenders/Brokers. It’ll be a lagniappe in the March 2013 issue of the Allen Letter professional journal. This latest update contains more ‘lenders’ of both stripes, than any of the previous 14 editions. FREE to newsletter subscribers, simply phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 to do so. And guess what? A copy of the 24th annual ALLEN REPORT® will be mailed to you as well!
***
George Allen, CPM & MHM
Box # 47024, Indpls, IN. 46247
(317) 346-7156

Blog # 233 Copyright 2013 17 February 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

Thinking Outside the Box

“The HUD – Code Manufactured Housing Industry Looks to New, even Renewed Product Design, as well as Novel Ways to Market, Sell and Finance this Nation’s Most Affordable Shelter Option!”

George Allen, CPM & MHM
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide

EXECUTIVE SUMMARY: Think ‘Community Series Homes’ and the ‘Removable Chassis Option’. Then realize, Today’s On – site Sale of New Homes in Land Lease Lifestyle Communities === Yesterday’s independent ‘street’ MHRetailer; the Near Plethora of Creative Home Financing Methods, even a Rebirth of Rental Homes! And now, Sound the Clarion Call for U.S. Department of Housing & Urban Development (‘HUD’), manufactured housing’s federal regulator for the past 37 – 39 years, to Aggressively Promote this Most Affordable Single Family Housing Alternative in the U.S. Today!!! YOU on board? YOU should be!

I.

Community Series Homes, a.k.a. CSH Model HUD – Code manufactured homes, debuted during 2009. The concept was birthed at the second National State of the Asset Class caucus, held 27 February, at the RV/MH Heritage Foundation’s Hall of Fame, Museum & Library facility in Elkhart, IN. Why? HUD – code home manufacturers were near desperate to sell more new homes into (then) manufactured home communities, and these investment property owners needed smaller homes with ‘durability enhancing features’, to site on vacant, sometimes functionally obsolete (i.e. too small for behemoth Development Series Homes) rental homesites. The Community Series Home moniker was suggested later that year, by Don Westphal, the manufactured housing industry’s preeminent landscape engineer – during the 19th annual International Networking Roundtable in Chicago, IL., where three new CSH Models were on display in the host hotel parking lot. And as they say, ‘the rest is history’.

The accompanying, ‘novel marketing method’, in this instance, was to name nearly three dozen Business Development Managers or BDMs, tasked solely with marketing and selling CSH Model homes into (now) land lease lifestyle communities nationwide, oft times to one or another of the 500+/- known LLLCommunity portfolio owners/operators. The CSH & BDM situation today? Not as bright a picture as it should be! Far too few CSH models are exhibited at regional manufactured housing shows (e.g. less than a half dozen among three dozen homes on display at the recent Louisville MHShow in January 2013). And frankly, too few capable, experienced, motivated BDMs on the widely – distributed CSH/BDM Information Sheet today. *1 After all, as land lease lifestyle community owners/operators, we have an estimated 250,000 vacant rental homesites to ‘fill’ nationwide; and fewer than a dozen BDMs simply won’t get the job done! When will HUD – Code home manufacturers ‘wake up’ and take advantage of this CSH model homes and vacant rental homesite reality opportunity?

II.

The ‘removable chassis option’ is seen, by some if not many, as a timely and practical stimulus to increase the annual volume of HUD – Code home shipments, stuck at 50,000/year for the past five years! How so? While not intended to be applicable to all new manufactured homes moving down the production line, it certainly would be an easy and attractive way to debut a top – of – the – line home option to prospective homebuying consumers (i.e. Removal of steel chassis from under the new home once at the site of installation). AND THIS IS NOT A NEW THOUGHT AT ALL.. The ‘removable chassis option’ goes back to before year 1990, when the manufactured housing industry came to within a hair’s width of seeing Congress (House of Representatives), adopt the measure as a way to reform and modernize the (then) 15 year old federal manufactured housing law. Unfortunately, the reform bill, including the chassis (removal) provision, a.k.a. the ‘Hiler amendment’ (Named for its’ chief sponsor, then Representative John Hiler, of Indiana), succumbed to 1) opposition from federal regulators; 2) industry competitors (e.g. Think site builders): and, sad to say, 3) internal industry politics.

One might ask, ‘Why wasn’t the removable chassis option included in the Manufactured Housing Improvement Act of 2000 (a.k.a. ‘MHIA@2000’), ten years later?’ Frankly, it should have been. But annual home shipment numbers were increasing then, until reaching an acme of 372,843 during 1998, before plummeting to the nadir of 50,000 new homes shipped per year for the past five years, with still only 54,881 new homes shipped during 2012.

Today however, we need every (sales & production) stimulating measure
we can identify, and the ‘removable chassis option’ is one such opportunity! This time around, however, we can ill afford to have it succumb (again) to INTERNAL INDUSTRY POLITICS! Do you recall the particular ‘devil in the details’ in 1990? I do.

III.

‘On – site marketing and sale of repo, resale, and now ‘new’ HUD – Code manufactured homes, modular homes, ‘park model’ RVs, and more!’ Yep; that’s the 21st Century land lease lifestyle community’s new, and likely ‘here to stay’ until chattel financing returns, BUSINESS MODEL; not necessarily by choice, in many cases, but certainly by necessity! Frankly, when I entered this business in 1978; had someone told me I’d ‘see the day’ when owners/operators of this unique, income – producing property type would be voluntarily buying NEW manufactured homes to sell – sometimes at or near cost – to qualified homebuyers, just to ‘get the site rent meter running’, I would not have believed them! But that is the Stark Reality Today, and NOW, even that ‘reality’ is evolving again. For a relatively brief time, say between 2002 and 2010, land lease lifestyle community owners/operators, as they had two decades earlier (e.g. late 1970s – 80s era), sold repo and resale homes ‘on contract’, at whatever terms ‘worked’ for prospective homebuyer/site lessee cum ‘residents’ or customers.

Then along came the federal S.A.F.E. Act (Safe And Fair Enforcement for Mortgage Licensing Act), unevenly enforced among dozens of states; since joined by the federal Consumer Finance Protection Bureau or CFPB, a.k.a. ‘Choking Financial Professionals Bureau’, and its’ regulatory measures. Result? Many LLLCommunity owners/operators heretofore comfortable with ‘contract sales’ and other forms of self – finance, have since identified, and are now engaged in ‘safer’ ways to get buyers into homes on site, e.g. via ‘captive finance’ entities; the lease – option; P2P (e.g. Peer-to-Peer), P2B (Peer-to-Business), B2B crowd funding; rental units; 21st Mortgage Company’s popular C.A.S.H. Program; and soon, a new chattel lender entering the market, joining ‘the Big Four + 1’ independent, third party chattel finance firms. *2

And that’s pretty much where we are today: ‘Heavily regulated if you do (finance); damned (to potential business failure) if you don’t – or don’t do so, in strict compliance with said over – regulations!’ Two unfortunate and profound results of this Law of Unintended Consequences ‘regulating finance affair’, have been and will be:

1) The effective neutering of a nationwide cadre of entrepreneur businessmen and women, long engaged in putting low and middle income citizens into manufactured homes – without federal government assistance ($ subsidy) – at their own risk, at this base level of homeownership!

2) And as a further probable consequence, the potential and exponential increase in this nation’s already large number of homeless individuals and families; when no one else steps up to the base level of homeownership plate to assist this otherwise ignored and oft forgotten level of citizenry!

A friendly suggestion. If you agree with the sentiments expressed in the previous paragraph (part III of this blog posting), print it off and send it to your Congressman, along with a personal note, challenging him or her, as to whether they’re fully aware of the havoc their legislative actions, these past few years, have wrought!?

IV.

The independent ‘street’ MHRetailer, as reduced in number as they are (from 4,000+ nationwide a decade ago, to fewer than 1100 today) warrant comment here. For decades, these independent entrepreneur businessmen and women, along with their ‘company store’ colleagues, were the veritable backbone of the HUD – Code manufactured housing industry! MHRetailers connected the ‘production’ hands, arms, and shoulders (home manufacturers) of the industry to the torso and legs that effected the ‘marketing, selling, and placement’ of said homes outside (Think ‘land & home’ packages) and within (then) manufactured home communities, and before that, ‘mobile home parks’, nationwide. But when chattel financing, per se, went away shortly after the turn of the century, MHRetail salescenter owners/operators, without their own land lease lifestyle communities to sustain them, for the most part, withered, died, and went away. And frankly, there hasn’t been much recent change to that sorry scenario.

However, there is a missed opportunity afoot. And it has to do with these same (remaining, surviving) independent ‘street’ MHRetailers. Those who remain must relearn how to sell new manufactured homes into land lease lifestyle communities! And know what? Many LLLCommunity owners/operators, particularly the one – off property owners WELCOME the return of MHRetailers filling vacant rental homesites for them! But there’re three impediments in the way: 1) MHRetailers, in general, seem to have forgotten ‘the drill’ involved in getting new homebuyers to move on – site into land lease lifestyle communities; 2) LLLCommunity owners/operators have forgotten how to engage in the routine ‘Care & Feeding of MHRetailers’, by courting them and providing helpful information about their properties; and, 3) Either or both ‘players’ now not having ready access to independent, third party source(s) of chattel capital to support home sales transactions. So both parties need to get busy and learn what available home finance measures complement their home sales and property investment circumstances; whether it be via forming ‘captive finance’ entities; using the lease – option; P2P, P2B, & B2B social funding; rental units; 21st Mortgage’s popular C.A.S.H. Program; maybe even accessing the new chattel player about to join ‘the Big Four + 1’ independent chattel finance firms. *2

V

Revisit the Clarion Call to HUD, to ‘GET ON BOARD’, and actively promote HUD – Code manufactured housing as this nation’s most affordable form of single family housing available today! If you missed reading last week’s blog posting, titled: ‘Hey HUD! Help Out!’, you really should go back through the blog archives at this website (community-investor.com), to review how HUD’s ‘need to become involved’, was researched and articulated, using the department’s own GOAL (“Helping low – and moderate – income and minority families achieve successful homeownership….”), MISSION (“…supporting housing opportunities for low – income and minority Americans….”), and various APPROACHES “…to promoting successful homeownership opportunities for low – income individuals….” Sure ‘reads’ like HUD envisions itself as ‘the federal agency’ tasked with “Helping low – and moderate – income and minority families achieve successful homeownership” doesn’t it? SO, is this a ‘good thing’ or a ‘bad thing’ for HUD Code manufactured housing, especially regarding new homes being sited in land lease lifestyle communities. Hmm?

Well, here’s a sampling of four ‘unabashedly PRO & three definitely CON’ responses to last week’s blog posting, ‘Hey HUD! Help Out!’:

“Enjoyed this week’s blog. I can relate firsthand to the way HUD has shunned the MH sector. Hopefully, some pressure, and subsequent recognition, helps them realize we are a tremendously viable home ownership option for low to modest income families!” KS, a LLLCommunity owner (Editorial note: Reread Part III of this week’s blog posting!)

“Great blog today! Excellent subject with good points and questions.” RR, an ACM®

“One of your very best (blogs)!” JD, an MHM®

“George. You really out did yourself on this one. Kudos and kisses (figuratively) for a great blog!” EH, a veteran MHIndustry consultant

&

“BE CAREFUL WHAT YOU WISH FOR!” BB, a retired MHRetailer & LLLCommunity owner/operator

“Oh boy, George, (given)…this plea to HUD, I have a great deal of trepidation.” ‘Recalling the analogy of the camel’s nose under the edge of the tent, when it comes to HUD’s programs and record’…”in low cost housing programs as huge boondoggles. And asking any federal agency to help private industry is fraught with potential trouble (i.e. HUD’s regulation of MH manufacturing is a perfect example); and like subsidized HUD low cost housing programs, awash with fraud, cost overruns of huge cost to taxpayers, and complete destruction of local, private rental markets.” NB

“HUD will not help without a cost. Those costs on the initial ‘help’ the HUD Code was to give us in 1976, were WAY big in lost profits, horrific complication of our business model, quality efficiencies never achieved, and the destruction of real changes in building and pricing methods that could have been developed….” Retired home manufacturer

What say YOU? Sure, I’d like to know; and by extension, so would the faithful blog floggers (readers) at this website; but also (again) let your state’s Congressional delegation know of your thoughts on this timely, albeit controversial topic.

In conclusion; I see ‘two levels or types of support’, in this clarion call: ‘Hey HUD! Help Out!’ The first and simplest being overt, and not just tacit, promotion of HUD – Code manufactured housing as ‘affordable housing’! The other being, arranging access to federal funding intended to enable ‘renters’ to become ‘homeowners’; or in the case of land lease lifestyle communities, ‘homeowner/site lessees’.

***
End Notes.

1. CSH/BDM Information List is available ‘Free for the asking’, by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

2. ‘Captive finance’ refers to a captive finance company, a.k.a. ‘related finance company’ established, as a separate legal entity from the (home) selling firm or land lease lifestyle community, for the purpose of financing homes the selling entity sells. For more information, contact Rishel Consulting Group @ (217) 971-3968. Then there’s the lease – option; for information on this subject, contact Spencer Roane, MHM® via spencer@roane.com. Same with the home social funding concepts commonly referred to as P2P, P2B, & B2B, where P = Person, & B = Business. Spencer Roane, MHM® is spearheading a regional cum national effort to cultivate these specialty finance investors to the HUD – Code manufactured housing industry & LLLCommunity asset class. Precedent already established throughout the UHaul business Model, where rolling stock equipment is concerned. The there’s the resurgence in ‘rental units’. For a FREE reprint on that subject, simply phone the MHIndustry HOTLINE number listed in end note # 1. Of course, 21st Mortgage Corporation’s year old C.A.S.H. Program is the popular WIN WIN WIN WIN (chattel) home loan program in place today. Contact Lance Hull via (865) 292-2120 & (800) 955-0021 for information and an application checklist. Announcement: The March 2013 issue of the Allen Letter professional journal will contain, as a lagniappe, the 14th annual National Registry of Real Estate and Chattel (Personal Property) Lenders. This is one of 12 Signature Series Resource Documents researched and published annually for land lease lifestyle community owners/operators. To subscribe to the newsletter (only $134.95/year), and receive the 24th annual ALLEN REPORT, and 15th annual National Registry of RE & Chattel Lenders, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

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

Blog # 232 Copyright 2013 10 February 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

SPECIAL NOTE to readers of this week’s opinion/editorial challenge…

This op/ed piece debuts here as blog posting # 232, on the community-investor.com website. Next, it’ll appear as a reprint, enclosed as a lagniappe, in the March 2013 issue of the Allen Letter professional journal. It is recommended, and hoped, YOU will send copies of ‘Hey HUD! Help Out! to all members of your state’s Congressional delegation, and include a personal note requesting they discuss this timely and apt challenge, at their earliest convenience, with Department of Housing & Urban Development officials!

Hey HUD! Help Out!

“Given Our Nation’s Near Stagnant Economy, it’s Time for the Department of Housing & Urban Development (‘HUD’) to Move Beyond Simply Enforcing the National Manufactured Housing Construction and Safety Standards (a.k.a. ‘NMHCSS’, passed by Congress in 1974 & implemented during June 1976), to Actively Promote & Help Finance Placement of New Homes into 50,000 Land Lease Lifestyle Communities, Coast to Coast!”

by George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide

The above challenge ‘has been in the making’ throughout my 35 year career in housing, four years shy of the 39 years the HUD – Code manufactured housing industry has been living with – some say ‘enduring’, the only prescriptive national (home) building regulatory code in U.S. history! Why the long wait for this challenge to grow legs?

Frankly, it’s taken nearly four decades for the right pieces to come together; and now, in my opinion they’ve finally done so! But first, here’s the recent triple trigger that gelled my thoughts and experience on the timely topic, prompting this essay challenge.

The Fall 2012 issue of Evidence Matters, is a 28 page booklet published by HUD’s Office of Policy Development and Research. It opens with a feature article, titled: ‘Paths to Homeownership for Low – Income and Minority Households’. Then, within the first three pages of the HUD publication, that lead article title is stated, restated, reinforced three times by Erick C. Poethic, Acting Assistant Secretary for Policy Development and Research; as well as by Rachelle Levitt, Director of Research Utilization Division:

• “Helping low – and moderate – income and minority families achieve successful homeownership has always been a core goal of the U.S. Department of Housing and Urban Development.” P.2. Ms. Poethig (Emphasis added. GFA)

• “…supporting housing opportunities for low – income and minority American remains central to our mission.” P.3. Ms. Levitt (Emphasis added. GFA)

• “this issue of Evidence Matters examines various approaches to promoting successful homeownership opportunities for low – income individuals….” P.3. Ms. Levitt (Emphasis added. GFA)

As I read and reread of HUD’s core goal and mission; then absorbed what other writers in Evidence Matters had to say about ‘paths to homeownership’, Individual Development Accounts, Housing Choice Voucher Homeownership, and a couple shared equity models, I found myself thinking, once again:

‘Why isn’t HUD, manufactured housing’s federal regulator for 39 years, actively promoting and assisting with the financing of new home placement into land lease lifestyle communities (a.k.a.’ manufactured home communities’, and before that ‘mobile home parks’) as a practical means of ‘Helping low – and moderate – income and minority families achieve successful homeownership’?”!

Well, you’ll have to ask HUD officials how they answer ‘that question’; and why, for 39 years, they’ve not explored using the inexpensive factory – built housing type they regulate, as one, if not the key answer, to addressing this nation’s perennial affordable housing shortage? *1 Having been actively involved in factory – built housing since 1970, and the land lease lifestyle community real estate asset class since 1978, I have long and well – honed opinions on that particular matter.*2 But that’s not the gist of this essay challenge.

So, ‘Why today?’ One paragraph in Evidence Matters, crystallized the matter for me, and hopefully it will for you, as well. Here goes:

“Renters of HUD – assisted units may become homeowners via the Housing Choice Voucher Homeownership program, which has been responsible for nearly 15,000 homeownership closings in the past decade. This program allows participating public housing agencies to offer residents the option to apply their rental voucher subsidy toward monthly ownership expenses. After satisfactorily completing a preassistance counseling program that covers home maintenance, budgeting and money management, credit counseling and credit repair, and mortgage financing, the purchaser finds an eligible home. Foreclosure, delinquency, and default rates were quite low for these buyers, who were mostly single mothers with children, minorities, and people with disabilities moving into neighborhoods with higher homeownership rates and slightly lower poverty rates than the neighborhoods where they had rented.” P.8 Quoted from an interview with Janneke Ratacliffe. (Emphasis added. GFA)

It was the latter two of four highlighted portions of this paragraph that hooked me. An eligible home? Why not a HUD – Code (regulated) manufactured home? And, ‘moving into neighborhoods with higher ownership rates’? In traditional land lease lifestyle communities, the vast majority of sited homes are owned by rental home site lessees! Yes I know; for a reason no one has ever satisfactorily explained to me, the fact that underlying realty is owned by someone other than the homeowner/site lessee gives government officials, politicians, lenders, and the like, pause. Yet somehow it’s ‘OK’ to subsidize low income and minority renters living in apartment units and communities affixed to realty owned by someone other than the apartment lessee. Go figure. Some call it discrimination among housing types, and politics among housing players. Reread end note # 2.

Perhaps NOW is the time to take a renewed look at the pieces of this housing puzzle that, when appropriately addressed and accounted for, shall motivate HUD to ‘finally and actively promote & finance new home placement in land lease lifestyle communities from coast to coast’ via the Housing Choice Voucher Homeownership program, or something akin to it!

The right pieces?

• An eligible home. Must be the right size, configuration, and price for the would be homebuyer/homeowner. So, why not a HUD – regulated manufactured home?

• Rental voucher subsidy. The right loan terms and a 30% Housing Expense Factor (‘HEF’), that includes PITI: loan principal & interest, apportioned real estate taxes and insurance premium; as well as all household – related expenses, not including CATV & telephone expenses).*3

• High homeownership neighborhood. A professionally managed *4 land lease lifestyle community, charging a monthly rental homesite rate 1/3rd the monthly rent rate for a 3BR2B garden style apartment or townhouse in the same local housing market *5; and, requirement for a long term written lease, to ensure a fair and just ongoing housing value proposition for the homeowner/site lessee.

The final paragraph of the Evidence Matters publication feature, inspiring this challenge to HUD, to move from being ‘just a housing product regulator, to active promoter and finance facilitator for HUD – Code manufactured housing being sited in land lease lifestyle communities’, underscores the potential merit and reward of the aforementioned recommendations:

“Because the housing market remains fragile, it will take time and thought to
develop reforms that provide access to mortgages for creditworthy low – income
and minority families while also reducing risk and increasing protection for
consumers, investors, and taxpayers. These outcomes are vital to sustainable
homeownership for millions of Americas and are central to the overall health of the economy.”

Yes, it’s past high time for this long awaited and much needed reform; so, let’s join together, MHARR & MHI, along with the Manufactured Housing Congressional Caucus and clamor for…

‘Hey HUD! Help Out!’

***
End Notes.

1. Affordable housing. This is one housing writer who rarely mentions ‘affordable housing’ &/or ‘housing affordability’ without providing a definitions and a multipart frame of reference for readers. So, FYI. Definition: “Housing is affordable when individuals or households ‘…earning less than half of their area’s median income or AMI’, can afford to rent a conventional apartment and or buy a home in their local housing market.” Quoted from June 2011 issue of Multihousing Professional, page # 11. The multipart frame of reference includes Six Measures of Affordable Housing & Housing Affordability that include: the 30% Housing Expense Factor or HEF; The Housing Opportunity Index or HOI; The Housing Wage or HW; The Workforce Housing or WFH; The Income to Home Value Ratio or IHVR; and the very subjective, ‘One Who Believes’ that “Ownership housing is affordable if the price is right”. The latter frame of reference definition quoted from Shelterforce magazine, Fall of 2007. This material summarized from Chapter # 4, ‘Affordable Housing & Housing Affordability’ in the Book of Formulae, Rules of Thumb, & Helpful Measures…by George Allen, PMN Publishing, Indianapolis, IN. 46247., 2012.

2. For example, take the Manufactured Housing Improvement Act of 2000 (a.k.a. ‘MHIA@2000’). It was designed by Congress to require and achieve full parity between HUD – Code manufactured homes and all other types of housing! Specifically, the U.S. Congress directed HUD, in this law, to “facilitat(e) the acceptance of the quality, durability, safety and affordability of manufactured housing within the Department” – in other words, place HUD – Code manufactured housing into the mainstream of housing and home financing programs supported by HUD, to the tune of billions of tax dollars every year! And once the MHIA@2000 law is ‘finally and fully implemented’, after a 12 plus year hiatus, HUD, FHA, lenders and others, must STOP discriminating against HUD – Code manufactured housing, and begin treating it, in every way, like all other types of housing in the U.S. Just how far out of touch is HUD today, when it comes to ‘promoting’ HUD – Code manufactured housing as an affordable housing alternative in the U.S.? HUD – Code manufactured housing is not even on the department’s ‘radar screen’ of Strategic Plan goals and sub goals! For example; an ‘Advanced Search’, entering the words ‘manufactured housing promotion’, on the department’s website, produces this left field result: ‘Promotion of alternative dispute resolution’, along with other similar red herring results, all having nothing to do with promoting HUD – Code manufactured housing as an affordable housing choice, within or outside 50,000+/- land lease lifestyle communities located throughout this nation! Yes, it’s high time for a change: ‘Hey HUD! Help out!’

3. The oddly but appropriately named ‘Ah Ha! & Uh Oh! Worksheet’ was designed for use within and outside the manufactured housing industry and land lease lifestyle community asset class, to: Using a prospective homebuyer’s Annual Gross Income (‘AGI’) and/or local housing market’s Area Median Income (‘AMI’), as a starting point, and a 30% standard Housing Expense Factor (‘HEF’), to calculate the maximum amount of home mortgage and home Price Point a homebuyer or local housing market can afford under ‘affordable’ & ‘risky’ lending and home buying conditions, whether said home was being sited within a land lease lifestyle community or on a scattered building site conveyed fee simple. Form is available, for the asking, from PMN Publishing via the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

4. Professional property management or PM is not, unfortunately, all that widespread among the estimated 50,000+/- land lease lifestyle communities scattered throughout the U.S. As a starting point, however, firms engaged with HUD, in an effort to promote homeownership of manufactured homes to be sited within this unique, income – producing property type, in my opinion, should be expected to have at least one Certified Property Manager® or CPM® member of the Institute of Real Estate Management® or IREM® on staff at all times! And every on – site property manager should have been trained in and completed, one or another of the several professional property management programs, and not just parts thereof, presently available to them via MHI’s MHEI: the Accredited Community Manager® or ACM® program; PMN Publishing’s Manufactured Housing Manager® or MHM program; or in California, that state’s homegrown PM training and certification program.

5. 3:1 Rule of Thumb. While this guideline is hotly contested by some, it’s been a practical mainstay throughout the land lease lifestyle community asset class for at least three decades. A few tweaks apply. 1) When estimating the stabilized rental homesite rate in a land lease lifestyle community along or adjacent to an interstate highway beltway around a major SMSA or MSA, divide the average area apartment or townhouse rental rate by 2.5 instead of 3. 2) This rule of thumb might indeed need further refinement when used in one or another of the Sunbelt regions of the U.S., e.g. Florida, southern California, Arizona, Nevada. 3) And when preparing apartment/townhouse and land lease community Market Studies to effect this 3:1 calculation, ensure one is comparing apples to apples, by checking to see that items such as water and sewer billing, even heating, is treated similarly before the mathematical calculation is completed. For other formulae and rules of thumb associated with manufactured housing and the land lease lifestyle community real estate asset class, read Book of Formulae, Rules of Thumb, & Helpful Measures…available from PMN Publishing by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

***

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

***

Blog # 231 Copyright 2013 3 February 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

Have You Ever Wondered What You’re Missing, by Not Subscribing to the Allen CONFIDENTIAL! newsletter?

Here’s an inside look at two of 10 stories & four blog summaries, featured in the February issue of TAC!; the first, a dual focus commentary on the recently concluded, successful Louisville MHShow; the second, exciting FLASH NEWS, describing a rare educational and networking opportunity, in our nation’s capitol, for 20 land lease lifestyle community owners/operators who register…

I.

‘They simply don’t get it!
Who? HUD – Code home manufacturers & show organizers!’

Both cases in point were clearly evidenced at the recent ‘2013 Louisville Manufactured Housing Show’, formerly known as the Midwest Manufactured Housing Show, with 30+ new homes on display, and dozens of supplier booths.

• HUD – Code home manufacturers. It’s estimated there are approximately 250,000 vacant rental homesites in 50,000+/- land lease lifestyle communities (a.k.a. manufactured home communities) throughout the U.S. today! And at least half those quarter million vacant rental homesites are likely functionally obsolete, i.e. unable to site today’s typical ‘big box = big bucks’ developer series home(s), as said sites were developed when homes were half the size they are today. And most HUD – Code home manufacturers now include a line of Community Series Homes or CSH Model homes (i.e. singlesection and smaller multisection homes with durability – enhancing features) in their design and production capability. BUT, does one see CSH Model homes ‘identified and showcased as such’ at regional MHShow? NO! Last week at the Louisville MHShow I saw NO signs promoting Community Series Homes (though admittedly, I could have missed a sign or two), and I counted fewer than a half dozen homes, mostly singlesection, that ‘might have qualified’ as such. BOTTOM LINE? Land lease lifestyle community owners/operators, large and small, need Community Series Homes to fill vacant rental homesites in their properties, and at this point in time, ‘go begging’ for same, as HUD – Code manufacturers ballyhoo ‘Big Box = Big Bucks’ behemoth models at regional MHShows. Time for a change! (On a related not, the late Warren Huddleston: RV/MH Hall of Fame member, Illinois MHPioneer, and perennial KY MHShow Chairman, frequently complained of this same shortsightedness, on the part of HUD – Code manufacturers ‘for many years’ before his demise). Hence, ‘They, HUD – Code home manufacturers simply do NOT get it!’, and continue to drag along at a nadir of 50,000+/- new home shipments per year, now going on five years in a row. Go figure.

• Show organizers. OK; I know. In years past, when there were more than 4,000 independent ‘street’ MHRetailers & ‘company stores’ (formerly called ‘dealers’), and not the paltry 1,100 remaining today, it was anathema to do anything at a manufactured housing trade show that’d pull would be homebuyers (e.g. aforementioned MHRetailers) off the showroom floor! After all, the prevailing attitude was ‘They’re here to buy (homes),not learn anything!’ Well, times have changed. Not only are there far fewer MHRetailers ‘to buy new homes to sell’; land lease lifestyle community owners, by default (few to no nearby MHRetailers selling/moving homes into their properties anymore), have had to learn to sell repo, resale, and now new HUD – Code manufactured homes, to fill vacant rental homesites, as older homes deteriorate and disappear. Unfortunately – in this industry observer’s opinion – the variety and quality of off – the – showroom – floor educational sessions has NOT kept pace with the knowledge and HOW TO… demands of MHShow registrants. That sorry shortfall was convincingly demonstrated last week in Louisville, KY when 70 land lease lifestyle community owners/operators paid $50.00/person to leave the fairground, and go learn about lease – option and other chattel finance strategies; ‘How to Collect 100% of Their Site Rent 100% of the Time!’; and, where to go to learn ‘How to Be Compliant with Today’s Myriad of Financial Regulations’.

Yes, it’s past time for HUD – Code home manufacturers and MHShow program committees to Wake Up & Effectively Deliver, 1) the appropriate housing product, and 2) the ‘How To’ educational topics sorely needed by land lease lifestyle community owners/operators, who take the time and expend the resources, to attend regional trade shows!

Enough said, and hopefully, ‘you get this point’! Few other writers in the manufactured housing industry and land lease lifestyle community asset class, with two notable exceptions*1, routinely put their professional reputation and business credibility ‘on the line’ in your behalf, to communicate the truth! Regularly challenging long held traditions and marketing practices, that once spelled Success for this ‘double dual industry’*2, but today stymie us from being this nation’s preferred housing purveyors and shelter suppliers of choice, replete with a positive brand identity, and reputation for being ‘truly affordable housing’.

II.

FLASH NEWS: Announcing a half day Workshop for Land Lease Lifestyle Community Owners/operators in Arlington, VA., on Monday, 25 February.

Plans have been finalized that might be of interest to YOU! At the request of land lease lifestyle community owners/operators in the Washington, DC area (Think MD, VA, DE, & eastern PA), we’re hosting ‘A Workshop for LLLCommunity Owners/operators!’, Monday morning, 25 February 2013, from 8:00AM until Noon, followed by a networking luncheon at the event hotel. Capacity is limited to first 20 owners/operators who sign up!

Important Notice: This exciting Workshop has nothing to do with MHI’s
Legislative Conference being held the same day. It’s simply an educational,
networking alternative to there being no NCC division meeting this month.

Preliminary agenda includes a ‘meet & greet’ from 8 – 8:30AM; ‘State of the MHIndustry & LLLCommunity Asset Class’, from 8:30 – 9AM; ‘Maximizing Profitability of Land Lease Lifestyle Communities!’ from 9 – 9:45 AM; ‘ID New Chattel $$$ to Fill Vacant Rental Homesites!’, from 10 – 10:45AM; and, an ‘Open Discussion of Industry & Asset Class Issues, Trends, Resources, & More….from 11AM until Noon. Morning will end with a group ‘order from menu’ luncheon at the hotel restaurant. Cost? Only $75.00 per person, to cover meeting room and related expenses. Want to participate? Phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633.-4764 or (317) 346-7156. Remember; ‘First Come, First Served!’ BONUS. If you’ve wanted to learn firsthand, about the lease – option, when used in LLLCommunities; be there!

III.

Well, there’s your taste of the nearly 14 year old limited circulation publication, the Allen CONFIDENTIAL! business newsletter. Yes, it’s expensive @ $950.00/year for 12 monthly issues. However, if a TAC! subscriber is also a subscriber to the Allen Letter professional journal (also a monthly trade publication, but only $134.95/year), then TAC! is only $750.00/year. So, taken altogether, the two newsletters and annual ALLEN REPORT, bought separately, cost $1,584.95/year. But when the two newsletters are subscribed to together, the total cost is reduced to $884.95, for an annual savings of $700.00. So interested in subscribing? Again, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, and ‘don’t risk being shown what you’re missing’, ever again! GFA

***

End Notes.

1. The exceptions? Danny Ghorbani, long time executive heading the Manufactured Housing Association for Regulatory Reform or MHARR; and, Ken Rishel of Rishel Consulting, with his two online finance – related publications. You can count on these long time MHIndustry executives, and yours truly, to communicate ABC3 (‘accurate; brief; clear, concise & complete’) trade – related information, that’s become increasingly difficult to find and read ‘in print & on line’ these days! And if Bruce Savage was still on board, in Arlington, VA., we’d quickly add him to this too small number of trade journalists, as well.

2. ‘double dual industry’ = ‘HUD – Code home manufacturing & distribution; land lease lifestyle community development and investment/management’.

***

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box 3 47024, Indianapolis, IN> 46247 (317) 346-7156

Blog # 230 Copyright 2013 27 January 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

I.

Highlights from the 24th annual ALLEN REPORT
II.

More About MHI’s NCC Division’s Non – Meeting Plans

III.

POWER Networking Luncheon Attracts 70+ Attendees!

***

I.

Highlights from the 24th annual ALLEN REPORT,
a.k.a.
‘Who’s Who Among Land Lease Lifestyle Community
Owners/Operators Throughout North America!’

Well, it’s ‘out and about now’, having been distributed as a lagniappe in the January 2013 issue of the Allen Letter professional journal. The ALLEN REPORT is a 12 page Signature Series Resource Document, one of a dozen similar monthly SSRD research reports and directories prepared by PMN Publishing, for land lease lifestyle community owners/operators nationwide, and in Canada.

Here are highlights from the 24th annual edition of the ALLEN REPORT:

• The only chattel finance ‘light at the end of this decade long tunnel’, during 2012, was 21st Mortgage Corporation’s C.A.S.H. Program for LLLCommunities.

• MHI has new president & CEO (Dick Jennison) & NCC a new VP (Jenny Hodge)

• 6 reasons: ‘land lease lifestyle community’, not manufactured home community

• New: Book of Formulae, Rules of thumb & Helpful Measures @ MHIndustry

• Finally; increased concern regarding ‘home finance & site rent value proposition’

• Community Series Homes now a ‘fact of life’ but still resisted by MH factories

• Inspire Communities. Merger of Follett Investment Properties & Bertakis Dev.

• Unintended consequence of 30+ years of property consolidation: less RE brokers

• Birth of Manufactured Home Communities Owners Association of N. America

• 110 of 500+/- LLLCommunity portfolio owners/operators respond to AR survey

• Top 10 portfolio owners/operators control 55% of rental homesites in AR survey

• LLLCommunity portfolio owners/operators from 30 states respond to AR survey

• Average national physical occupancy percentage is down from last year’s figure

• Average national Operating Expense Ratio (‘OER’) higher than last year’s figure

• Self – finance dollar volume, ‘paper carried by LLLCommunity owners’, is down

• LLLCommunity portfolio owners/operators continue to acquire RV parks & sites

• Little to no construction of new rental homesites anywhere in the U.S. & CN.

• Professional property management on the decline among LLLCommunities

• Pride of Young Lions features GCP/ALL, RHP, UMH, & Inspire Communities

• Half of original Daring Dozen investors are still, after eight years, going strong

• MHIndustry unity & national leadership at a tipping point? Maybe. You decide

• 25 Most Influential People in the MHIndustry Today! All named by their peers

• And much much more, for MHIndustry & LLLCommunity aficionados alike…

To order the 24th annual ALLEN REPORT; know that it is FREE to Allen Letter professional journal subscribers (i.e. Only $134.95/year for 12 monthly issues), OR for $500.00 per copy. To order, phone the MHIndustry HOTLINE: (877)MFD-HSNG or 633-4764.

***

II.

More About MHI’s NCC Division’s Non – Meeting Plans

The Good News is, National Community Council’s elected chairman responded by email, to my inquiry and criticism regarding his summarily canceling the regularly scheduled biannual membership meeting of said MHI division, in Arlington, VA., during late February 2013. The Not – So – Good News, in my opinion? Well, here’s a key paragraph from said correspondence to yours truly. Read and decide for yourself, especially if you’re presently a direct, dues – paying member of MHI and or its’ National Communities Council division:

“The Executive Committee planning session will be closed other than for the Executive Committee and any invited guests. We don’t anticipate your participation. Similarly, while we expect to seek suggestions from a variety of constituents of all shapes and sizes either before, during or after the upcoming planning session, we don’t anticipate requiring your involvement. For the time being, this initial planning for the future of the NCC will, in fact, be placed in the hands of the Executive Committee and our work will be shared with the membership at the appropriate time. I’m sure you’re aware that most other large organizations plan effectively for the future in exactly the same manner.”

Yes, that’s how the paragraph was penned, including the redundancy, lack of punctuation, and obvious pompous tone.

Some observations. This is the first indication there’ll be individuals, other than the Executive Committee per se, who’ll be invited guests. That may be a good thing, maybe not, depending on who they invite. Wonder if we’ll (NCC members) ever know?

OK, OK, I get the message! “We don’t anticipate your participation.” & “…we don’t anticipate requiring your involvement.” It’s clear, this duly elected NCC board member is unwelcome to participate in the Executive Committee’s ‘closed planning workshop’. Be that as it may, “I plan to be in attendance at the MHI Legislative Conference.” Hmm. Wonder if I should plan an alternate educational activity for NCC members who, out of loyalty to MHI/NCC, plan to attend the February meeting? I can think of two ‘most appropriate alternative topics’ already. Let me know of your interest via MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. This could be fun….

And that last sentence. Sure, Executive Committee discussion, during retreats and other venues, is certainly one way to ‘plan for the future of the NCC’; but interestingly, for a national Advocacy body birthed by MHI on 1/1/1996, this is the FIRST & ONLY TIME, in my recollection, where duly elected (and appointed) officers have purposely cut themselves off from direct, dues – paying members and their input, regarding ideas, preferences, and suggestions regarding the present and future of the NCC council. So, if nothing else, the Executive Committee is ‘making history’ of themselves.

Frankly, I and others believe, this ‘closed planning workshop’, in lieu of the regularly scheduled biannual NCC meeting, is simply a subterfuge. And those council and audience members present at the NCC meeting on 8 October 2012, in San Antonio, TX., likely understand why. The cowardly public verbal ambush of two NCC members, for alleged offences not documented to this day, and who were not given opportunity to defend or rebut said charges, remains unresolved! So, a ‘closed planning workshop’, again – in lieu of a regularly scheduled membership meeting, is just one way to – like the U.S. Congress – ‘kick the can down the road’, settling nothing.

III.

POWER Networking Luncheon Attracts 70+ Attendees!

…and fully half of them, by a show of hands during lunch, and from responses penned on Event Evaluation Forms turned in following the luncheon, indicated they were either 1) attending their first Louisville MHShow, or 2) deciding to participate in the POWER Networking Luncheon opportunity, convinced them to travel to the KY Fair Grounds for the event this January!

‘LOL’ A humorous sidebar to this event, was the presence of a couple 2’WX3’H bright yellow signs near the MHShow registration area, warning readers, ‘George Allen’s POWER Networking Luncheon is not part of the official MHShow program’. Well guess what? As we were seating an already capacity crowd of 60 registrants at the luncheon, another ten individuals showed up, half indicating they’d read the (above) signs and decided the POWER Networking Luncheon was where they really wanted to be! So a ‘Thanks’, of sorts to the lone show vendor who spent good money to negatively promote this ‘more than sold out’ event. Lessons Learned? ‘Bad publicity is better than no publicity at all!’ & ‘Turn a lemon (yellow sign) into lemonade (luncheon fees)!’ ‘LOL’

Bottom line? There’re several! First; as event organizers, we accomplished our twofold goal: Attract new faces (i.e. land lease lifestyle community owners/operators) to the Louisville MHShow, AND provide a quality educational and networking opportunity:

• Ken & Donna Rishel, the manufactured housing industry’s Power Couple, held the rapt attention of their two Open Discussion Groups, as they walked them through the morass of increasing Federal and state finance regulations. Want more information about their $ workshops and freelance consulting services? Phone (217) 971-3968.

• Spencer Roane, MHM®, widely known, in land lease lifestyle community owner/operator circles, as the ‘lease – option guru’, shared a dynamite, multi paged handout titled: ’10 Critical Steps in MH Seller Financing!’ Everyone should want a copy! Reach him via spencer@roane.com

• Michael Power, flew up from Florida, to once again hold forth on his popular ‘How to Collect 100% of Your Site Rent 100% of the Time!’ methodology. To request a copy of Michael’s handout, phone (305) 879-3776 & ask about his freelance consulting services for land lease lifestyle community owners/operators.

Another ‘bottom line’ had to do with the Surprise Special Speaker on the Program. It was ‘yours truly’. And the POWER Networking Luncheon achieved its’ ‘historical significance’ as the first public venue at which the birthing of a new, national, not for profit entity, to serve the ‘statistical Research & ongoing Resource servicing’ of land lease lifestyle community owners/operators, coast to coast, and maybe Canada, was announced! Still tentatively known as the Manufactured Home Community Owners Association of North America, or MHCOA in short, the entire presentation will be shared, first with subscribers to the Allen CONFIDENTIAL! business newsletter, then in the Allen Letter professional journal. Already, in excess of 100 businessmen and women have committed to join the new Research & Resources entity; have you? If seriously interested, simply phone the above referenced MHIndustry HOTLINE or via gfa7156@aol.com Details to follow. Pivotal date = likely 2/27/2013. Are YOU on board?

There’s yet another ‘bottom line’ to this superbly successful POWER Networking Luncheon. And it has to do with state manufactured housing associations throughout the U.S.. If you’d like to bring this tripartite, half day program to your state (Either morning or afternoon, including breakfast or a luncheon), know all four presenters are willing to address your members, given scheduling compatibility, for reimbursement of travel – related expenses! Three of the presentation topics are listed in the previous paragraph. What’s the fourth? That’s up to you and what your members need, e.g. ‘State of the MHIndustry & LLLCommunity Asset Class’; ‘How to Calculate Affordable & Risky Price Points for New & Resale Homes Going into LLLCommunities or onto Private Property Conveyed Fee Simple’; or, ‘How to Sell More Homes into Land Lease Lifestyle Communities!’ – latter message addressed primarily to HUD – Code home manufacturers and independent ‘street’ MHRetailers and ‘company stores’. If interested, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. This could be the very best program you offer your members all year long! Think about it – and call….

***

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indpls, IN. 46247 (317) 346-7156

Blog # 229 Copyright 2013 20 January 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

I.

Manufactured Housing Industry’s Enronesque Period

II.

What? No Meeting of the National Communities Council?

III.

MHInitiative®, Second Generation Workshop, & More…

***

I.

Manufactured Housing Industry’s Enronesque Period

‘When We Dodged a Lethal Bullet & Didn’t Know It!’

“The Enron scandal, revealed in October 2001, eventually led to the bankruptcy of the Enron Corporation, an American energy company based in Houston…” Google Search
-meanwhile-
The manufactured housing industry’s businessmen and women routinely engaged in turning our (home buying) customers ‘upside down’ financially, using a variety of housing finance shenanigans, a.k.a. predatory lending measures.

The adjective ‘enronesque’ has since been spawned by the aforementioned Enron scandal; and to this day, ‘relates to accounting methods meant to deceive, accounting legerdemain spun to make something seem affordable.’ Housing maybe?

Frankly, it’s a minor miracle ‘enronesque’ hasn’t been applied before this, to manufactured housing industry financial shenanigans that, in large part, caused us to lose our independent, third party sources of chattel (personal property) finance; and, in lesser part, why those resources haven’t returned, en masse, to this day.

Remember business life back then? At the turn of the 21st Century, specifically 1998, when during our brief renascence, the HUD – Code manufactured housing industry shipped 372,843 new, mostly Developer Series Homes (a.k.a. ‘Big Boxes = Big Bucks’), to compete head to head, as land and home packages – for increased local housing market share – against production site builders.

As a rule, we sold customers ‘more home than they could afford’, accepted false or inaccurate loan applications, encouraged phantom and insufficient mortgage down payments, and engaged in underwriting ARMs (adjustable rate mortgages) with flagrant interest rate swings, and too often, arranged for the installation of these behemoth new homes in (then) manufactured home communities, ‘rent free’ for periods of time.

Yep, this sad period in our industry’s history, when independent ‘street’ MHRetailers, and company stores alike, espoused this mantra: ‘We have no $$$ down, no job, no problem deals for you!’, deserves this label:

Manufactured Housing’s Enronesque Period, circa 1994 – 2002

And it will be so – labeled next time the Signature Series Resource Document, ‘Paradigm Shifts of Mobile & Manufactured Housing’ (subtitled: ‘Serving shelter needs of the newly wed & nearly dead for seven decades’) is updated (November 2013), and distributed as a lagniappe in the Allen Letter professional journal. To subscribe, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

II.

What? No Meeting of the National Communities Council?

As a direct, dues – paying member of the Manufactured Housing Institute and its’ National Communities Council division, my firm pays $500.00/year as a land lease lifestyle community owner/operator. And I’ll pay a near like amount to participate in MHI’s annual Legislative Conference in late February. And let’s not forget the hundreds of dollars in annual dues we pay to Indiana and Illinois Manufactured Housing Associations ,’just to be eligible’ to be a direct, dues – paying member of the national Advocacy body. And NOW I learn there will be NO opportunity, during MHI’s annual Legislative Conference, to meet and network with fellow NCC division members in Arlington, VA @ 25 & 26 February. Where’s the dues value in that change of plans?

WHY no meeting? Following passage is quoted, in part, from email correspondence received from the division’s chairman, on 16 January – a week and a month before many of us expected to convene in Arlington, VA., for the first time since MHI’s annual meeting, and NCC’s debacle meeting on 8 October 2012, in San Antonio, TX.

“In lieu of the NCC business meeting that has been held traditionally in
conjunction with the MHI Legislative Conference and Winter Meeting, at the
upcoming meeting, the NCC Executive Committee will instead hold a closed
planning workshop focused on solidifying the NCC’s vision for the future. Our
goal will be to define a vision that ensures the NCC supports MHI’s broader
legislative advocacy and marketing outreach efforts, provides the range of
services most valuable to the variety of constituents we represent, makes interim
NCC meetings more productive for all our members, and expands our
membership to add to our resources and strength as the only MHI division
representing community owners.”

Don’t know ‘bout you, but the first of several questions this paragraph raises, is this:

Why didn’t NCC Executive Committee hold a ‘closed planning workshop’ between its’ last meeting during October 2012 and now, so it’d be ready and able to communicate its’ ‘vision for the future’ in late February in VA?

Know what this selfish pre empting of the ‘traditional’ February meeting means to those of us who are faithful attendees (As a related aside, I’m an elected NCC board member, but do you think we’ll be invited to this Executive Committee soiree? Nope.)? We get to wait until the next NCC meeting, probably next Fall at MHI’s annual meeting, unless there’s’ an interim NCC meeting during the MHCongress in Las Vegas this coming April.

You probably noticed the four part goal contained within the quoted paragraph. Broken out, the parts are:

• “…define a vision that ensures the NCC supports MHI’s broader legislative advocacy and marketing outreach efforts…” That’s pretty much ‘business as usual’, based on my not having missed an MHI/NCC division meeting in years.

• “…provides the range of services most valuable to the variety of constituents we represent…” One can only hope, between now and this ‘closed planning workshop’, the Executive Committee reaches out to its’ members, including ‘yours truly’, and asks: What ‘services (are) most valuable to me as a land lease lifestyle community owner/operator?’ Think that’ll happen? Wait and see. But given the MHIndustry’s penchant for designing, building, and shipping homes to ‘then sell’, rather than the other way around; my guess is we’ll wind up being told what ‘services (are) most valuable to me as a LLLCommunity owner/operator.’ That too, sad to say, is pretty much ‘business as usual’ for this group.

• “…makes interim NCC meetings more productive for all of our members…” Hmm. What’s the ‘diff’ between an interim and a regularly scheduled NCC meeting?

• “…expands our membership to add to our resources and strength as the only MHI division representing community owners.” Now this is a cute one. An obvious call for more dues revenue; but what are direct, dues – paying LLLCommunity owners/operators, like you and me, receiving in terms of benefits, from NCC membership? National advocacy, for sure. But what else? Non – meetings like this one in February 2013?

At this point, I’d like to ask the following question of NCC’s Executive Committee:

It’s pretty well known throughout the land lease lifestyle community realty asset class, MHI’s NCC division effectively handles the national Advocacy needs of its’ unique, income – producing property type members. But what about the plethora of other products and services LLLCommunity owners/operators presently enjoy, from other sources, and not presently provided by MHI’s NCC division?

STOP HERE! Originally, the plan was to list ‘right here’, those needed products and services, some think should be available via MHI’s NCC division. However, several LLLCommunity owner friends advised ‘not to do so’, likening the matter to ‘beating a dead horse’ where this national body is concerned. So, to switch the subject…

There’s concern today’s NCC division has become a ‘Big Boys (largest property portfolio owner/operator dominated) Club’, given No representation on its’ present Executive Committee, by sole proprietors and smaller property portfolio owners/operators. There’s serious concern this imbalance bodes ill for small businessmen and women, where present and future NCC Advocacy decisions – as well as Research& Resources, if or when taken in – house at the MHI/NCC, might be concerned. This issue deserves to be soon addressed, but not in a ‘closed planning workshop’ attended by the division’s executive committee and a few invited guests.

And let there be no misunderstanding. I plan to attend MHI’s annual Legislative Conference in late February 2013; and if NCC’s Executive Committee wants to meet with me before, during, or after their ‘closed planning workshop’, I’ll do my best to be accommodate them.

III.

MHInitiative®, Second Generation Workshop, & More…

Let’s hold this off until maybe next week. Many who’ve been responding to this blog of late, have inquired as to when and where there’ll be a FOCUS Group meeting this Winter (i.e. a 1 ½ day regional gathering of LLLCommunity owners and senior executive property managers addressing five key operational topics they select); and, what plans there are afoot for an industry wide MHInitiative®. In this latter instance, MHInitiative® plans are ‘on hold’ until we learn what, if anything, unfolds from MHI’s NCC division’s ‘closed planning workshop’ in late February, and the anticipated emergence of the Manufactured Home Community Owners Association of North America, or MHCOA in short, around that same time…think 27 February 2013.

Others of you, have been asking us to plan and host a one or two day program, dealing with Business Succession Planning, for second and third generation owners/operators of land lease lifestyle communities. If this topic is a ‘hot button’ for you and your family, let me know via email: gfa7156@aol.com or the aforementioned MHIndustry HOTLINE. It continues to be ‘simply amazing to me’ that none of our present day national bodies appear to be sensitive to not only routine, but special needs (like this one) on the part of their constituents, industry and nationwide.

***

George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indpls, IN. 46247
(317) 346-7156

Blog # 228 Copyright 2013 13 January 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.

I.

Land Lease Lifestyle Communities Celebrate 20 Years of History

II.

‘Hooray!’ for MHCA’s ‘The Future of Manufactured Housing’…

III.

MUSINGS

IV.

2013, a Breakout Year? Maybe if…

***

I.

Land Lease Lifestyle Communities Celebrate 20 Years of History

For a multifamily rental property type that’s been around for 70 years, land lease lifestyle community (a.k.a. manufactured home community) contemporary history ‘first blossomed’ 20 years ago, during 1993.

Prior to 1993, national advocacy decisions were handled by an ad hoc committee, during Manufactured Housing Institute meetings. But when rumors of IPOs (initial public offerings of stock), pursuant to REIT (real estate investment trust) formation, became commonplace, it was generally agreed national advocacy would be in need of marked and formal improvement.

Prior to 1993, only one book had been authored during the preceding two decades, describing any aspect of mobile home park operations. And that was Mobile Home Park Management, self – published in 1988 by PMN Publishing in Indianapolis, IN. Six years later, in 1994, J. Wiley & Sons debuted Development, Marketing & Operation of Manufactured Home Communities. Both books ‘sold out’ within six months after being released. Since then, the first book has gone thru six updates and is now titled, Landlease Community Management. The second tome, long out of print, and considered by many to be an industry classic, continues to be available via PMN Publishing and Amazon.com. Point? Prior to 1993, HOW TO information, along with benchmark operating statistics re the LLLCommunity asset class, were exceedingly difficult to find.

Prior to 1993, two print trade publications, the Journal – which is still in existence, and the Manufactured Home Merchandiser magazine (now defunct) were unabashedly ‘HUD – Code home manufacturing & retail sales oriented’. No question about it, and no apologies offered. When I started writing columns, for both publications, during the late 1980s & early 1990s, it was understood they were token nods to the realty segment of the MHIndustry. Since that time, other trade pubs have come and gone, e.g. Modern Home and Community Management. The Allen Letter professional journal (1991) and the Allen CONFIDENTIAL! (1999), both subscriber – supported newsletters; along with a few online ezines, feed our appetite for industry and asset class information.

Prior to 1993, little to no professional property management education. While MHI’s Manufactured Housing Education Institute’s (‘MHEI’) Accredited Community Manager® or ACM® program debuted in 1991, it took a couple years to reach its’ potential; and in 2001, was joined by PMN Publishing’s Manufactured Housing Manager® or MHM® program. Today, PM training & certification programs are in place – but not utilized nearly as much as they should be, given 50,000 LLLCommunities nationwide. This sad situation has not improved much at all since 1993.

So, what’s the big deal about year 1993? Well first; know two separate resources, birthed in successive years, combined to create a third decisive occasion benefiting the entire specialty property type! In 1989, the ALLEN REPORT (a.k.a ‘Who’s Who Among LLLCommunity Portfolio Owners/operators in North America!’) replaced Roulac’s Strategic Real Estate ‘List of 25 Largest Mobilehome Park Owners in the U.S.’ And the following year, nearly 100 ‘mobile home park owners’ convened in Clearwater Beach, Florida, for the first of 21 annual International Networking Roundtable events. And subsequent to that first meeting, this idea was birthed…

Bringing us to 31 August 1993. While details of the historic event, formation of the Industry Steering Committee, or ISC, predecessor to MHI’s National Communities Council (‘NCC’) division, is recounted in Appendix G of How to Find, Buy, Manage & Sell a Manufactured Home Community (J. Wiley & Sons, 1996), a summary of those events follows here. That day, 19 owners/operators of (then) manufactured home communities met at an airport hotel in Indianapolis, IN. Among the 19, were executives from all the firms that’d launch IPOs during the next two years: MHC, Inc. (today, ELS, Inc.); Sun Communities, Inc.; Chateau Properties, Inc.; ROC Communities, Inc. (latter two eventually merged). And UMH Properties (then, United Mobile Homes), already a REIT – from the 1980s, was also present, as were a half dozen other private and corporate property owners. Following that watershed meeting, several additional Task Force gatherings convened at locations around the U.S., culminating, on 1 January 1996, with MHI forming the NCC (now division), to formalize national advocacy in behalf of land lease lifestyle communities nationwide.

So, year 2013 commemorates the 20th anniversary of LLLCommunity owners/operators ‘taking control of their collective future’, and laying the groundwork for representation and advocacy they’d need as several property portfolios ‘went public’. Year 2013 also marks the 17th anniversary of the NCC division proper. And for those reading this history, but not yet direct, dues – paying members of MHI and its’ NCC division, know that the next biannual meeting is 25 & 26 February in Arlington, VA. For membership and meeting information, phone (703) 558-0666 or 0678. And tell’em ‘George sent me!’ Hope to see you at the meeting in late February….

As a related aside, the RV/MH Heritage Foundation has been approached about effecting some sort of formal commemoration of this 20th anniversary, so important to owners/operators of land lease lifestyle communities. Perhaps special mention will be made of the Industry Steering Committee, and its’ 19 Pioneer attendees (most of whom have now retired or died), at the 2013 Induction Banquet honoring Hall of Fame inductees, during August 2013. Guess we’ll have to wait and see….

II.

‘Hooray!’ for MHCA’s ‘The Future of Manufactured Housing’…

Have YOU read it yet? What? The Manufactured Housing Communities of Arizona (‘MHCA’) January/February 2013 ‘newsletter’ cum 30+/- page booklet, titled: Today & Tomorrow. Actual title of this issue: ‘The Future of Manufactured Housing’. Kudos to executive director Susan Brenton, for planning and pulling off this futuristic coup! Want a copy? Phone Susan @ (480) 345-4202.

OK, here’s what I like about the overall newsletter cum booklet. There are no fewer than nine feature articles, penned by several attorneys (West of the Mississippi, they’re ‘everywhere’!), representatives from three national Advocacy bodies, one erstwhile land lease lifestyle community manager, one LLLCommunity owner, and MHCA’s president, Neal Haney, owner of NTH Management, a fee management firm.
There’s good substance buried within most of these articles, but you must ferret it out…

For example: Attorney Michael A. Parham’s piece, ‘A Dystopian Future for manufactured housing?’ Where dystopian is ‘…a society characterized by human misery, squalor, oppression, disease and overcrowding.’ His final paragraph reads, “I am gloomy about the future but still have some optimism that with innovation and hard work this industry can survive and perhaps prosper. But we need to recognize what is happening around us and be nimble enough to act to avoid the bad consequences and take advantages of opportunities presented by all of these new developments.” (Evidently, attorneys don’t use commas in AZ. GFA)

For example: Erstwhile property manager L.A. ‘Tony’ Kovac pens: “A well known, successful community operator has told me that if we aren’t careful, the land lease MH Communities of today will turn back into the corn fields, will be bought out by big box stores or ‘higher and better use’ developers. We have natural advantages because we do offer quality, affordable homes and living. But that doesn’t mean that we don’t have threats.” And he goes on, to rightly decry subsidized housing. Other threats?

For example: Attorney John A. Buric reminds us: “A segment of our industry will also continue to cater to lower income individuals, providing necessary housing to those who might otherwise be unable to afford decent housing. While many outsiders tend to bash our industry and some of its low end housing, the reality remains that such communities are an economic necessity and provide housing to individuals who could not otherwise afford a decent place to live.” How many times do we forget that perennial truism?

Here’s where & how I think MHCA can improve on this project, in the event they decide to perform this valuable service for the manufactured housing industry next year.

• Decide on a theme, like you did this time around, but solicit a more heterogeneous group of writers. While MHCA is a land lease lifestyle community owners’ trade association, only two of the nine articles are authored by 1) a bona fide LLLCommunity owner; and, 2) owner of a highly respected fee management firm specializing in this unique, income – producing property type. In my opinion, half the articles should be written by community owners/operators and HUD – Code home manufacturers. The other half? Industry advocates again, and certainly representatives from the chattel and real estate – secured finance (mortgage) segments of the manufactured housing industry.

• Hire a proofreader and content editor to polish all submissions! There were grammar, word choice, spelling, and punctuation issues within every article, e.g. missing commas, too many ‘that’ words, etc.. Also consider terminology alternatives and give writers an Approved List to use. In this year’s debut pub, nine variants were used to describe our unique, income – producing property type: ‘communities’ (Here Haney & Buric have the right idea); manufactured home community; manufactured housing community; parks; land lease lifestyle communities; and, one writer used three variants interchangeably: MH Communities, Land lease MHCs, and MHC’s. And, in my opinion, drop the use of ‘dealer’ next year in lieu of independent ‘street’ MHRetailer, and maybe ‘company stores’ (to differentiate manufacturer – owned sales centers from the former). Also prefer use of ‘resident’ and or homeowner/site lessee instead of tenant, and rental homesite or site, instead of lot, pad, stall, or worse.

• And there will be missteps, no matter how careful one parses, that slip by unnoticed. For example; in the MHARR piece, this statement is made: “What is needed…is dedicated, independent, national representation of the post production sector to effectively advance its’ interests in the nation’s capital (sic) – working in cooperation with the (home) producers’ national representation….” (author’s underlining) This is an obvious call for national advocacy association reorganization. Yet, when given an opportunity to advance said cause, two months after those lines were penned, the author waffles, claiming a subsequent change in priority.

Know what MHCA’s ‘The Future of Manufactured Housing’ issue reminds me of (excusing the dangling participle)? How ‘years ago’, the short – lived slick print trade publication, Community Management, prepared and distributed an annual compendium of Best Articles Published That Year, including some new material, regarding all aspects of (then) manufactured home community ownership and management. And there’s an interesting coincidence to be found in that comparison: both publications were researched and prepared by manufactured aficionados domiciled in Arizona!

III.

MUSINGS

Originally thought it was just me, but have since learned there’re many ‘skin in the game’ businessmen and women around the country who observe and think similarly about contemporary issues, disturbing trends, and more; all affecting the manufactured housing industry and land lease lifestyle community asset class. In no particular order or priority or emphasis, here’re those we’ve been seeing and pondering most of late…

Talking about ‘fair value propositions’, relative to homeowner/site lessees living in LLLCommunities, and enabling this to occur, is difficult if not impossible to ensure, when the property owner/operator touts a Maximize Profitability business model (i.e. ‘maximize – rental – income & minimize – operations – expenses’). Bottom line? Either enable ‘fair value propositions’ for one’s homeowner/site lessees, or stop boasting about the matter among your peers!

The sad disconnect, between word and deed, by national elected leaders talking ‘industry unity’ out of one side of their mouth; yet through inaction, encouraging the birthing of at least one, if not two, new national, not for profit manufactured housing – related trade bodies. Can’t help but recollect a similar scenario in 1985, when a group of disenchanted HUD – Code home manufacturers split from the Manufactured Housing Institute to form the Manufactured housing Association for Regulatory Reform. Paraphrasing a pair of oft – quoted, and related, aphorisms: ‘Those who fail to learn from the errors of their past, are likely to repeat them; and at greater cost, the second time around.’

The ol bugaboo of family leadership slippage, usually between first generation entrepreneurs and their adult children, when risk – taking and passion often wane in the face of business school acumen, fuzzy OJT, or some other supposed leadership education by osmosis. Time in the military, especially as a junior officer, oft helps here; unfortunately, most today do not go that route. A solution? Too little too late for many of you, but ‘Cut em loose for a year or two’, then see if they come back around, 1) more appreciative of their family’s business heritage, and 2) ready to be passionate, risk – taking, responsible business leaders! Of course, ‘the downside(?) risk’ is they find career fulfillment elsewhere and don’t return. I twice learned that lesson, first as a son, later as a father. But know what? In retrospect, I’d not have the matter evolve any other way….

Would be trade journalists unable to move beyond ‘throwing enough stuff against the wall – to see what might stick’, should focus attention and effort on business topics their prospective readers need and desire to see and learn, and less on opinion and editorializing, in print and online. Unfortunately, it appears the trendy need for ‘immediate gratification’, in all areas of life, has supplanted good old fashioned research and word smithing before publishing!. But there’s an opposite extreme as well. Trade columnists writing for pubs that boast of ‘using writers to fill white space among ads’. Geesh. How many ways can a columnist describe, over a period of 20 years, ‘HOW TO install skirting on a manufactured home’? Maybe that’s why readership is down.

How pimping a present day business relationship – or a potentially profitable relationship foreseen in the future, can trump doing the morally and organizationally right, albeit difficult thing to do today, given one’s position as an elected leader of a national body. But as they say, ‘What goes around comes around’. Just sad to say; it’s already happened on our watch.

IV.

2013, a Breakout Year? Maybe if…

Attention all C.A.S.H. Program Aficionados! As you’ll soon read in the 24th annual ALLEN REPORT, January 2013 marks the one year anniversary of the birthing of 21st Mortgage Corporation’s bold, symbiotic, new home purchase and chattel finance program; you know, the one that’s WOW – WOW – WOW for our home buying/site lessee customers, the land lease lifestyle community owner/operator, and the mortgage finance firm!

Well, a number of land lease lifestyle community owners/operators, knowing Spencer Roane, MHM®, David Funk, MHM®, and I, this time last year, worked with Matt Kerlin and Lance Hull, of 21st Mortgage Corporation, to establish the basics of 21st Mortgage Corporation’s exciting C.A.S.H. Program, have been inquiring about the possibility of getting together and talking about the progress, Lessons Learned, and more, during the Louisville MHShow in KY, during 23 – 25 January 2013. Informally, several of us have agreed to attempt to do so. So, to express ‘your interest’ in being part of an informal get together, contact Spencer via (678) 428-0212. We already know of C.A.S.H. Program users coming in from both coasts, as well as from throughout the Midwest.

And get this, learned just this week of yet another new chattel finance program is in the offing, maybe even during the aforementioned Louisville MHShow! This one, modeled somewhat after the C.A.S.H. Program, does not require $ participation by the LLLCommunity owner/operator, and applies only to lease – option and true lease agreements, relative to new and resale homes sited within LLLCommunities! Watch this weekly blog for further details. And if you see me at the MHShow in Louisville, ask me for more information then….

Will year 2013 be a breakout year for HUD – Code manufactured housing? Depends on a number of factors, for sure; but with the appearance of new and exciting finance programs, like the ones just described (2012) and hinted at (2013), we’re close to being ‘on our way back’ to increased home shipment volume!

***

POSTSCRIPT.

The 24th annual ALLEN REPORT is in the process of being distributed to hundreds of Allen Letter professional journal subscribers nationwide! Will you be among those receiving this seminal document during the next couple weeks? If not a paid newsletter subscriber (only $134.95/year), phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 today to subscribe. OR, buy single copy of ALLEN REPORT for $500.00.

SPECIAL ANNOUNCEMENT.

If interested, and not already registered to participate in the POWER Networking Luncheon, at the Crowne Plaza Hotel in Louisville, KY, @ 11:30Am – 2:30PM on 23 January, either phone the above – referenced MHIndustry HOTLINE; or better yet, print off the attachment to the BEBA (Blast Email Blog Alert) bringing you this posting, complete it and FAX it back to us ASAP via (317) 346-7158. Why is all this So Important? Because we expect to attract 75+/- land lease lifestyle community owners/operators to attend the Louisville MHShow for the very first time – to see Community Series Homes (or CSH Models) on display, and visit dozens of supplier booths, the afternoon after the luncheon and all day on the 25th of January. How can YOU not want to participate in this multipurpose occasion and event?

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