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

POINTs & COUNTERPOINTs

MHI’s Summer Meeting & MHARR; Super Symposium & new initiatives; Renewed Effort to Unify MHIndustry Voice in Washington & Grand Tour!

‘CAPITALISM Pays For SOCIALISM!’ read the bumper sticker on the rear bumper of a car ahead of me, as I drove into Washington, DC., last week. Later, as I checked into the Tabard Inn (‘Oldest continuously operating hotel in Washington, D.C.’) and my $113.00/night room (Shared bathroom down the hall) – otherwise $150+/- per night, with in – room facilities, I reflected upon how I get to make trips and choices as a citizen and businessman in this great country. And it got me to thinking how, at least in the world of free enterprise, how we continually use our talents and abilities, experiences and history, attitudes and motivation, to make key and timely decisions, ultimately spelling SUCCESS or FAILURE, for our employees, employers and businesses. Sincerely hope you’re as appreciative of this great country as I am! Are you?

I

Manufactured Housing Institute’s (‘MHI’) annual Summer meeting in Washington, DC., from 13 – 15 July, according to the registration list, attracted 95+/- participants. Run the numbers. Less seven government workers, 18 MHAssociation execs, and maybe five ‘no shows’; of the 65 remaining ‘direct dues paying members’ & ‘certified representatives’, nearly one third, exactly 20, were landlease (nee manufactured home) community owners/operators. Why is this important to know? Read on…. On a more positive note, Mark Weiss, Senior VP of the Manufactured Housing Association for Regulatory Reform (‘MHARR’) attended the Manufactured Housing Executive Council’s (‘MHEC’) meeting and other functions. First time this has happened in awhile. And know that quiet plans are afoot, to increase these participation numbers during 2011; both overall, and within the landlease community’s (‘LLCommunity’) advocacy body, specifically, the National Communities Council (‘NCC’) division. Are YOU a direct dues paying member of MHI? Perhaps YOU should be! To do so, phone Thayer Long via (703) 558-0678 and tell him ‘George sent me!’

II.

Appears the SUPER SYMPOSIUM movement is nearly dead. Oh, there may be a third symposium hosted by the reinvigorated Georgia Manufactured Housing Association (‘GMHA’), under the executive leadership of Jamie Hammons, but that’s probably the last one. Indiana Manufactured Housing Association/Recreational Vehicle Indiana Council (‘IMHA/RVIC’), in a budget cut, terminated their symposium guru after hosting at least two successful symposiums. The demise of this much – needed educational opportunity, when needed most, to teach LLCommunity folk How to Market & Sell New & Resale Homes On – site & Self – finance, is unfortunate if not tragic! BUT, look for a couple private, Free Enterprise initiatives to pick up this training slack during the months ahead. On 24 & 25 August, Precision Captive Funding will host their 12th two day Captive Finance Workshop, this time in Chicago, IL. To register, phone (217) 971-3968. AND, from 15 – 17 September, in Phoenix, AZ., the 19th annual International Networking Roundtable for LLCommunity owners/operators will convene, featuring nearly two dozen HOW TO seminars and panel discussions, best interpersonal networking in the asset class, unparalleled deal – making opportunities, and new Community Series (HUD Code) Homes on display! For a Roundtable brochure, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, or visit this website.

III.

Were you invited to participate in a conference call earlier this month, intended to spawn an ‘Effort to Unify the Industry’s Voice in Washington, DC.’? Didn’t think so. While said call attracted participation by at two of the remaining HUD Code housing manufacturers, and a plethora of state MHAssociation execs, there was little to no representation from other segments of the MHIndustry, particularly the LLCommunity ‘side of the house’. There lies the first challenge to this otherwise needed re-unity effort. Sure, having ‘too many fingers in such a pie oft creates a mess’, but NOT including the only industry segment enjoying general business success these days, is like effecting a business startup with no capital. And, as opined during the aforementioned MHEC meeting, any would be leader of such a worthy cause should be present with his/her peers, in this case in Washington, DC., to motivate, answer questions and guide planning. And the bottom line issue is: Do we really need, or even want, a third party effort to this (unity) end, when the MHIndustry, on two previous occasions, has managed to ‘come together’ to support mutually desired federal legislation, e.g. the Manufactured Housing Improvement Act of 2000? Counterpoint? In previous blog postings, plans for a Grand ‘Once & For All! Tour, of seven regions throughout the U.S. during 2011, was described. Perhaps this is the practical, long range (i.e. distance and time) means to, among other things, bring re – unity to the MHIndustry & LLCommunity asset class, especially if MHI & MHARR lend their support to the effort. Interested in having the Grand ‘Once & For All! Tour come to your geographic area? Let me know by phoning (317) 346-7156 or responding directly to this blog posting. For more info on the tour, visit the blog archives.

IV.

DID YOU KNOW? During the past four months, no fewer than four new books and booklets, describing one or more aspects of HUD Code manufactured housing and the landlease community real estate asset class, have debuted? All four will be profiled in the August issue of the Allen Letter professional journal! AND, the August issue of the Allen CONFIDENTIAL! business newsletter will address the following pithy, timely and challenging question: ‘What would I / YOU do if selected, tapped, asked, elected, to become Chairman of the Manufactured Housing Institute?’ Be assured, that’s not going to happen to either of us, even though this position of past renown and present responsibility/authority has not been attracting any takers in recent months. That reality alone, makes the I / YOU question, just posed, all the more timely and poignant – as new HUD Code housing shipments continue to languish at a more than a 60 year nadir!

VI.

FYI. The CONSORTIUM of print & online publishers of periodicals, for the MHIndustry & LLCommunity asset class convened (All present but one!) once again, during MHI’s Summer meeting in Washington, DC. Know what? Such a trade publication networking body was tried unsuccessfully, a decade ago, when Community Management, Manufactured Home Merchandiser, Automated Builder, and Systems Building print magazines were still in business. Appears this group is going to blossom. If you publish a weekly or monthly trade pub for the MHIndustry & or LLCommunity asset class, and would like to attend the CONSORTIUM’s next meeting, 15 – 17 September 2010, in Phoenix, AZ., phone the MHIndustry HOTLINE to express your interest.

*****

George Allen, Realtor®, CPM®Emeritus, MHM
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class

Box # 47024
Indianapolis, IN. 46247

(317) 346-7156

What’s So Hard About Doing This? Part II.

Part I? Scroll Back One Week in the Blog Archives at this website!

Turns out, not surprisingly, we’re not the only ones who underperform.

“I (almost) give up! Guess I shouldn’t have been surprised when the manager of a WAWA Dairy Store in Blakeselle, PA brushed off a (my) suggestion that would’ve boosted her location’s business volume”

Minutes earlier, I’d exited I-80 and bought regular unleaded gasoline for $3.09/gallon ($3.00/gallon if I’d paid cash) from a local Exxon station. Angered at the predatorily high price of the gas, I purposed not to buy my lunch there, so drove less than a mile to the local WAWA store. Pulling into the parking lot, I was shocked to see their regular unleaded gas was selling for $2.75/gallon! I’d just overspent at least $5.00 on a tank of gas! As I paid for lunch, I asked to speak to the store manager, and told her:

“If you posted a sign at the interstate exit down the street, announcing your $2.75/gallon gas price, you’d get a whole lot more business – considering your competitor of charging 34 cents more per gallon.” Her response? “Oh, we’re WAWA, everybody knows us, we don’t need no sign.” Geesh.

I suppose one could say ‘That’s the difference, sometimes, between an employee and someone with skin (i.e. equity interest) in the game’ of business. But I think it’s more than that. It also has to do with making it a point to be on one’s game (e.g. Ready to perform!) at all times one is expected to sell and lease; and, being open to new marketing and promotion ideas as well!

I.

How does the just related experience apply to selling manufactured homes and
leasing rental homesites? Well, here’s the drill…

A prospective homebuyer/site lessee pulls up and parks their car in front of your on or off – site MHRetail salescenter, hopefully in a space designated with an attractive sign that reads: RESERVED FOR FUTURE RESIDENT! As they get out of their vehicle and head into the Information Center, GET MOTIVATED and put a SMILE on your face and into your voice! Be prepared for ‘the performance of your life’!

As the prospect(s) walk in the door, don’t stay seated, GET UP and walk across the room, meeting them halfway, with an outstretched hand, and (again) SMILE on your face and in your voice! WELCOME them to the Information Center, introduce yourself, and ask their name(s) – and call them by name throughout the presentation and product demonstration. It’s an especially ‘good & timely move’ to then offer refreshment of some sort: something cold and refreshng in a hot climate; something warm or hot on a cold day. Now’s a good time to ask prospect(s) to complete a Guest Card, or you – as sales/leasing consultant, fill it in. That decision is simply a matter of personal style. Then, use the card, and the information contained on it, it to facilitate the sales/leasing presentation, since the card contains their housing needs, wants, etc… Speaking of Guest Cards, here’s a unique one ‘free for the asking’*: the dual purpose Visitor Information & Visitor Response card, perforated in the middle. Use the Information half as the aforementioned Guest Card, give Response half to prospect when they leave the Information Center – whether they bought a home or not, as it asks them to ‘grade’ the property and sales/leasing performance; then mail it back to the property or home office.

Qualify the interested prospect! Is the desired home (size, features, configuration) available now, or must it be ordered? Does prospect have the ability to purchase the needed/wanted home and, if sited in a landlease (nee manufactured home) community, pay the monthly site rent and related household expenses? The easiest way to measure this critical set of circumstances, whether for a land & home transaction; or, again, in the LLCommunity setting, is to use the ‘Ah Ha & Uh Oh! Form, also ‘free for the asking’*. And, as was pointed out in Part I of this two part series on manufactured housing sales & rental homesite leasing, be very careful NOT to Discriminate. Always remember and respect the seven protected classes of citizenry.*

Assuming homebuying interest is high and prospect is qualified to buy, Demonstrate the appropriate product! This means walking through new and resale homes in inventory and already on – site in the LLCommunity. Ideally, homes are skirted, steps/porches in place –if required, climate controlled, and as I’ve noticed of late, attractively landscaped with shrubs and flowers planted, in season, out in front of the home! Do your ‘homes for sale’ have those, and more, selling features in place? And while it pains me to remind you of this, ensure the appropriate Formaldehyde Warning Poster is in place, usually in the kitchen of the home. As a frequent Mystery Shopper, ‘that is not always the case’, hence a risky (regulatory = $ fine) state of affairs. Anyway, it’s not enough to unlock a model or new home’s front door and turn the prospect loose! It’s important to accompany the prospect through the home, pointing out, sometimes even demonstrating features along the way. And here’s an important tip: Vacuum carpets in model homes every workday! Why? Not only keeps them clean, but more importantly, obliterates traffic patterns that form as person after person walks the same or similar paths throughout the house. And, it’s usually a good idea to have floor plans and other sales literature available somewhere in the show house. One more timely tip: Have deodorizers in place in these homes, to mask or counter unpleasant odors. Done demonstrating one or more homes? Assuming prospect is still highly interested, and certainly ‘qualified’ to buy, invite them back to the Information Center to complete the paperwork to buy the home and lease a homesite in the LLCommunity! Most sales/leasing consultants do NOT effect this key critical step! Do you?

Well, there you have it. The basics of on – site sales and homesite leasing. Sure, there’re fine points not yet covered here, but I’m certain you ‘get the idea’. Have salescenter sales/leasing suggestions you’d like to share with readers of this blog? Let me know via gfa7156@aol.com or respond directly to this blog posting.

II

In last week’s blog posting, I mentioned a FREE resource designed to teach sales and leasing consultants how to enhance their personal security when working alone in an Information Center. If interested in receiving this list of ’10 Helpful Steps to Manager & Leasing Consultant Safety’, contact PMN Publishing.*

III.

So, how did the Open Discussion Among New England LLCommunity Owners, turn out? Excellent. Nearly two dozen convened on – site at Dave Piper’s Cranberry Village LLCommunity in Middleboro, MA. Representatives were present from Hometown America, ROC – USA, along with numerous small owners/operators. Program began at 10AM and ended after 1PM. Many local issues, including ‘local rent control’ were discussed, as well as national matters pertaining to the S.A.F.E. Act, and sad results of the 2 June 2010 Manufactured Housing Finance Roundtable in Elkhart, IN.

This gathering turned out to be a helpful precursor to the Grand ‘Once & For All! Tour being planned for seven U.S. regions during year 2011. These will be 1 ½ day sessions comprised of a healthy, challenging mix of information (‘State of the MHIndustry & LLCommunity asset class’); unity & motivation = join Manufactured Housing Institute (‘MHI’) as direct dues – paying members, especially the National Communities Council (‘NCC’); communication (i.e. Print & online resources available from the newly formed CONSORTIUM); education (re: ‘captive finance’ and ‘captive insurance’ and ‘other matters); and much more. There’s even talk of adding a second day for registrants who want to ‘stay over’ or have local on – site managers participate in the day long Manufactured Housing Manager (‘MHM’) professional property management and certification class.

If you’d like the Grand ‘Once & For All! Tour to come to your geographic area or specific city, and are willing to assist with planning and facilitating the program, please let this blogger know ASAP! We’re negotiating with a national hotel chain to use their facilities exclusively, so will need to identify the seven regions soon, e.g. New England, Mid – Atlantic states, Southeast, Upper Midwest, Lower Midwest, West, Pacific Northwest. And sponsors of this Fall’s 19th annual International Networking Roundtable will be given ‘first opportunity’ to sign onto this historic initiative, and have their product/service message taken nationwide during these sessions.

IV.

Due to space limitations, I’m unable to ‘tell you complete news stories’ in this weekly blog posting. For ‘the rest of the stories’, subscribe to the Allen Letter professional journal for $134.95/year – and receive a FREE copy of the 21st annual ALLEN REPORT (a.k.a. ‘Who’s Who Among LLCommunity Owners/operators Throughout North America!’).* AND, if interested in attending the 19th annual International Networking Roundtable in Phoenix, AZ. @ 15 – 17 September 2010, register at this blog’s website or phone (317) 346-7156. And while on the phone, order a copy of the recently released Manufactured Housing $$$ Primer!, subtitled: ‘Almost Everything You’ve Ever Wanted to Know About Chattel (personal property) Finance’

******

End Notes

To request ‘free copies’ of the Guest Card and Ah Ha & Uh Oh! Forms cited in this blog, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

Seven protected classes? Think: Realtors Can Really Sell Housing Fast Now, using the first letter of each of those seven words to remind one of Race, Creed, Religion, Sex, Handicap, Familial status, Nationality.

George Allen, Realtor®, CPPM®Emeritus, MHM
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024
Indianapolis, IN. 46247
(317) 346-7156

What’s So Hard About Doing This?

90% of MHRetail Salecenter & LLCommunity Sales/Leasing Consultants Do Not Do What’s Described in the Following Paragraphs, Yet Every One of Them Should!
I.
Note to regular readers of this weekly blog! No, we’re not turning this timely, informative and widely read communication tool into a tutorial about signage, Mystery Shopping; and this week and next, telephone and in person, on – site salesmanship and leasing. Rather, we’re taking a short hiatus to ensure everyone reading this blog can say, once the previous and following suggestions have been implemented and supervised, “We’re doing our part to put the MHIndustry & LLCommunity asset class back on track as this nation’s Best Source for truly affordable, attractive, quality, non – subsidized, ‘green’ housing, along with highly Desirable Lifestyle Environments in professionally managed landlease (nee manufactured home) communities!” So here goes….
The phone rang six times before someone answered, saying “Whadaya want?” When I asked if it was ‘so & so’ MHRetail salescenter in ‘such & such’ landlease community, they answered: “Yea.” Such is the too frequent beginning of MOST initial telephone inquiries to MHRetail salescenters, in and outside LLCommunities. Folk, it’s time to ‘shape up’ and start performing professionally as leasing and sales pros, or admit defeat, and get into some other line of work.
Here’s how the initial incoming telephone inquiry from an otherwise interested, and let’s for the moment assume, ‘qualified’ prospective homebuyer and rental homesite lessee, or eventual resident, should be handled.
Answer the phone on the second ring; not the first, third, fourth, fifth, or sixth. Why? Several good reasons. First, use the initial ring as a reminder to put a SMILE into one’s voice! Use the first ring to ‘get motivated’ to sell and or lease! As Zig Ziglar oft said, “I’d rather be greeted with a fake smile (in one’s voice), than with a genuine frown!’ So, give your new customer a genuine SMILE! Think about it. Furthermore; answering on the ‘first ring’ is akin to pouncing on the potential customer – like you’ve got nothing else to do but that. Answering on the third, fourth, fifth, or sixth ring conveys the opposite message: ‘Hey, I’ve got better things to be doing than talk to you!’ Surely you’ don’t want to convey that turnoff message, do you?
So, what Greeting to use? Longtime readers and clients of mine know, I prefer how the Newby Management team, of Ellenton, FL., ‘does it’: “Good morning (or afternoon); Thank You for Calling Newby Management (or salescenter name). I’m (name), how may I serve you?” Oomph! Did you catch that? Don’t know ‘bout you, but I want to get to know folk better who want to SERVE me! And here’s your opportunity to begin to do likewise. Perhaps it’s high time you start wowing your prospective homebuyers and site lessees when they phone!
Early on in the initial telephone conversation, Ask for caller’s name, and Make a record of it on the Daily Traffic Report (You do have such a daily record of phone calls and on – site visits, right?) on the clipboard right next to the telephone. After all, you just shared your name during the Greeting, so ‘fair’s fair’ to ask for theirs – and use it during the conversation. Besides, if you’re like me, and sincerely believe this initial phone contact is a critical first key step to developing Good Resident Relations = More Resident Referrals = Great Resident Retention (a.k.a. ‘6Rs of Really Good Resident Relations!’), then ‘Get this relationship off to a good start!’ And by asking for prospect’s name that serves as a good and timely reminder to get their contact information as well – adding it to the aforementioned daily traffic report. Let me know if you’d like a ‘free’ copy of such a traffic recording form.
At this point, inquire as to caller’s housing needs. What’s needed? When is it needed? How will they be paying for the home and site rent (qualifying question). Just be careful not to discriminate during this important first conversation. How to know? Just recall that old bromide: ‘Realtors Can Really Sell Housing Fast Now!’ The first letter of each word is a reminder of each of the seven protected classes of citizenry: Race, Creed, Religion, Sex, Handicap, Family, and Nationality. Think I’m kidding? You won’t, the first time you get caught practicing ‘linguistic profiling’ by an agent contracted by the federal government to ensure you’re playing fairly. During this part of the conversation, offer some pricing information as well (housing price range, site rent amount), as a further non – discriminatory way to qualify prospects.
Furthermore, if the caller is interested enough to have phoned the salescenter and or property, given you their name and address/phone number, and worked through the housing needs and qualifying conversations, by all means ASK FOR A DEFINITE APPOINTMENT TO VISIT on – site!
But the job is not yet done! Don’t forget to offer Travel Directions to your location. Don’t cop out and suggest they use Map Quest or rely on a GPS system. While popular tech options, there’re still many folk not so technically inclined, and need help finding your location. While you’re at it, ask How They Learned of the salescenter or property. Why? This is the easiest and best way to gauge the effectiveness of whatever marketing means are in effect at the time, e.g. referrals, billboard, drive – by, newspaper ads, online information (e.g. MHVillage.com), Yellow Pages directory, local Chamber of Commerce, brochure picked up at a local hotel, resident referral, and on and on.
Well, that’s about it. Those are the most basic of touchstones used by the most successful of leasing and sales consultants working in today’s MHRetail salescenters and on – site in landlease communities. How confident are YOU, your staff is following that or a similar routine? Maybe time to find out! How? Mystery Shop them! Call the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and ask for a ‘free’ copy of the Standard Shopping Report form.
OK, let’s turn our attention to what happens when the prospective homebuyer and or homesite lessee arrives to see and experience housing product and lifestyle features.
Do you have signage off – site and on – site to guide visitors to your location? In last week’s blog we talked about bootleg signs at interstate exits, adopting the last quarter mile of highway leading to your property’s entrance, WELCOME HOME entrance signage, and vacant rental homesite signs suggesting BUILD YOUR NEW DREAM HOUSE HERE! Call (information center’s phone number). Are these signs now in place? How ‘bout getting prospect from the entrance to the Information Center (Hopefully you’re not still calling it an Office). If it isn’t right there within eyesight of the entrance, plan on putting small signs out enroute to it. And reserve best parking spot with the sign: RESERVED FOR FUTURE RESIDENT!
OK, prospect arrives on – site, at the Information Center, gets out of their vehicle and comes into the salescenter. What does your staff do? Do you have any idea? You’d better! Here’s what they ‘should do’…
We’re going to stop here, for now, for two reasons: Some blog readers have suggested these postings are too lengthy. And perhaps they are. What do you think? Please let me know, via response to this specific posting at this website, or via email to gfa7615@aol.com or at above phone number. Other reasons? Have some breaking Good News to share with you in the following paragraph or two.
II.
SSBRA Announces affordable, frost resistant foundation!
Today, 1 July 2010, the Systems Building Research Alliance (‘SBRA’) announced the release of the FROST FREE FOUNDATION® design, an affordable foundation solution for placing homes in areas subject to frost. The design is far less costly than either poured concrete footings that extend the foundation below the frost line or concrete (‘floating’) slabs, the two alternatives recommended by HUD for complying with the Manufactured Home Installation Standards in areas subject to frost, which includes most of the U.S.
The FROST FREE FOUNDATION® is based on this simple concept: if a home is installed in a manner that assures the ground under the home is dry and will remain dry, the soil will lack sufficient moisture to heave. For such homes, installing components intended to resist frost heave, such as concrete footings below the frost line, adds cost but provides little value. The concept follows from the manufactured housing industry’s decades of experience installing millions of homes in the Frost Belt with few problems. As industry expert George Porter, an early and tireless advocate for the project explained, “The concept is simple; keep the ground dry, no frost heave. It’s not rocket science.” The design is a variation on the shallow, frost protected foundation systems increasingly popular with site builders.
The FROST FREE FOUNDATION® was developed with financial support from several state MHAssociations and companies involved in manufactured home product, supply, community operators (including the author of this blog posting), and MHRetailers. Seven home manufacturing companies also provided funding. The work was guided by a technical committee chaired by Mark Ezzo of Clayton Homes. In developing this foundation solution, the SBRA (a division of the Manufactured Housing Institute) engaged the services of Paul Hayman, PE. Explaining the dynamics of frost heave, Hayman emphasized ground heave can only occur if three conditions are met: the soil is frost susceptible, outdoor temperatures below freezing are sustained for long periods, and the soil has sufficiently high moisture content.
Interested in more information on this timely and critical subject? Visit www.research-alliance.org/pages/frostfreefoundation.htm Also reach Emanuel Levy, executive director of the Systems Building Research Alliance via (212) 496-0900X14 or elevy@research-alliance.org
III.
What’s Really Happening Throughout the MHIndustry & LLCommunity real estate asset class these days? Next week, 13 – 15 July, in Washington, DC., MHI will host its annual Summer Meeting & Legislative session, also the National Communities Council (‘NCC’) division. Second meeting of the CONSORTIUM of Print & Online Trade Publications will occur at that time, along with a planning meeting for the previously announced Grand ‘Once & For All’ Tour of seven regions during 2010 & 2011. Contact Thayer Long @ (703) 558-0678 for MHI/NCC details.
Week of 23 August 2010? If in Chicago at the time, and a LLCommunity owner/operator, plan to attend a networking dinner for LLCommunity execs, a two day Finance (Chattel) Finance Seminar, the one day Manufactured Housing Manager (‘MHM’) professional property management training and certification seminar. For info call (317) 346-7156.
And, 15 – 17 September, plan to be in Phoenix, AZ., for the 19th annual International Networking Roundtable event, featuring Community Series Homes (‘CSH’) on display; dozens of LLCommunities ‘for sale’ around the U.S.; Randy Rowe, of Green Courte Partners, as leadoff keynote presenter, along with 20 additional educational and panel discussion offerings! For a brochure and or to register as a LLCommunity owner/operator or event sponsor, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.
******
George Allen, Realtor®, CPM®Emeritus, MHM
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024, Indianapolis, IN. 46247

What MHRetail Salescenter Operators & Landlease Community Owners Owners
Should Learn from the Apartment Industry

Apartment owners have the job performance of their leasing (sales) consultants Mystery Shopped regularly, landlease community folk rarely do, and MHRetail salescenter managers almost never do!

Apartment community leasing consultants are believers! They KNOW their individual job performance, during telephone and on – site interviews will be monitored monthly, year in – year out. Accordingly, they treat every incoming telephone call from, and every on – site visit by, a prospective lessee, as interactions with bona fide ‘shoppers’! As they should; because all inquirers are ‘shoppers’, just like the callers and visitors to landlease communities and MHRetail salescenters. Only diff, is the goal to get interested and qualified ‘shoppers’ to rent and or buy from us; while (professional) ‘shoppers’ are paid to measure how well or poorly on – site staff carry out their job descriptions! Here’re basic lessons we can learn from our apartment community consultant counterparts…
Apartment leasing consultants answer incoming telephone calls on the second ring – not the first (too quick) or fifth (too slow), with a sure SMILE in their voice! They then ask the caller’s name, recording it on a daily traffic record, and then use it several times during the conversation. How important is this initial conversation? Many believe it’s the key first step in establishing Good Resident Relations (in the LLCommunity setting) and Good Customer Service (in the home sales environment)
Consultants then identify caller’s housing needs: immediate or 30 days out; size of living quarters needed, etc., while also ascertaining whether they’re ‘qualified’ to lease and or buy at this particular location (e.g. employed, retired, family or adult only, etc..), being very careful not to discriminate along the way. Why should this be any different in a LLCommunity or MHRetail salescenter?
The ‘close’ of a telephone interview with an interested and qualified prospective lessee or buyer is to ‘Get an Appointment on – site!’ Do all our consultants know & practice this? As a pro ‘shopper’ I know they don’t!
Once this is accomplished, offer Travel Directions to the property or salesceneter, AND ask how they first learned of the property or salescenter – to measure effectiveness, or not, of marketing efforts, re advertising, etc.. This latter information should also be recorded on aforementioned daily traffic record, with results tallied and acted upon at the end of each week.
When prospective lessee or homebuyer is enroute to the property or salescenter, is there signage helping him/her find their way? Two ways to do this. First, consider buying and installing bootleg signs (exact imitations of aluminum plate DOT signs, per print style and PMS colors) at exit(s) from nearest interstate highway (Just name of property, with an appropriately – directed arrowhead). Then, within a quarter mile of the property, ‘adopt’ the highway, either officially – if a program is in place, or constructively, by installing a 2’X2’ sign, on an engineer stake, announcing ‘This Highway Lovingly Cared for by (name of property or salescenter)’. Must maintain that ¼ mile stretch of road, and be sure not to infringe on a neighbor’s property without securing permission.
When prospective lessee or homebuyer arrives on – site or at the sales center, is there a sign out front Welcoming them? For example, at every entrance to an apartment or landlease community there should be a small (1’X2’) sign, saying WELCOME HOME! On the front side, and DRIVE CAREFULLY on the back side. All apartment communities do this. Do you?
Do you reserve the best parking site outside the Information Center (Surely you’re not still calling it an office) for visitors? For example: RESERVED FOR FUTURE RESIDENT! Or’ Reserved for Dream Home Buyers!’ Apartment folk do this all the time! Makes you feel special when visiting the community or salescenter for the first time, every time….
Are your sales and leasing consultants schooled in how to ensure their personal safety and security when working alone in the Information Center and or demonstrating product (i.e. rental units, new homes, etc.)? Apartment consultants practice such measures all the time. Want a free list of ten such personal tips? Request it via the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.
OK, let’s stop here for a moment and concentrate on the landlease community lifestyle.
Have vacant rental homesites? Sure you do. BUT, do you manicure them (i.e. trim any shrubs, mow the grass, pick up debris, remove earth anchors & dangerous steel strapping, protect utility risers, and rake the site)? Once that’s done, on some of the sites, install a 2’X4’ sign, painted both sides, that proclaims: THIS CHOICE SITE AVAILABLE! Call (information center telephone number)! Captures the attention of visitors and drive – thrus all the time – if you do it.
Do YOU allow free and random storage/parking of vehicles, boats, trailers, and RVs on vacant rental homesites? NOT. Provide a fenced, secure area for this service and charge a fair storage fee, as one more measure of AITR (alternative income to rent). Otherwise, over time, you host a junkyard and increase your liability for various forms of risk.
AND, conventional apartment communities routinely reduce their monthly ‘call rental rates’ (i.e. The rate they quote over the phone during the initial interview) when physical occupancy begins to drop, then raise them when occupancy rebounds. Do LLCommunities do this? Rarely. Wonder if there’s a message here? Think about it….
This is plenty to consider for the time being. However, questions, suggestions, or ideas from your personal and corporate experience are welcome. Let me know via this website or phone (317) 346-7156 or via gfa7156@aol.com
What does it cost to Mystery Shop LLCommunities and MHRetail salescenters? Fee varies, but oft about $500.00 per location, plus out of pocket travel expenses. Sometimes less, if four or five properties/salescenters are close enough together, geographically, to ‘shop’ in one day. What’s $500.00 get you? Phone and on – site performance evaluation of personnel and property by an experienced ‘shopper’, completed Standard Shopping Report with narrative, documenting discrepancies (curb appeal, rules enforcement, marketing and sales/leasing shortfalls). Also attached are handouts from the consultants, along with color photographs of what needs improvement at this location. Interested? Let us know…
What else is going on in the MHIndustry & LLCommunity asset class these days?
Will I see you at MHI’s Summer meeting in Washington, DC., @ 14 & 15 July? Hope so. For details, phone Thayer Long at (703) 558-0678. National MHRetailer & LLCommunity councils meet then too.
How ‘bout during the week of 23 August in Chicago, IL. So far, I know of a possible networking dinner among area LLCommunity owners, the one day MHM class, Precision Capital Funding’s two day seminar (Call 217/971-3968 for information), and a planning meeting for the Grand ‘One & For All’ Tour of seven regions of the U.S., scheduled during remainder of this year and throughout year 2011.
Most important though, is the upcoming 19th annual International Networking Roundtable at the Pointe Hilton Tapatio Cliffs Resort Hotel in Phoenix, AZ. As this is a ‘by invitation only’ event, contact us via the MHIndustry HOTLINE cited earlier, to request a registration brochure. What’s going to happened there this year?
New Community Series Homes on display, a couple dozen LLCommunities ‘for sale’, Randy Rowe’s ‘take’ on the MHIndustry & LLCommunity asset class today. And much much more. Want to know how truly exciting this event will be? We’ve already been accepting registrations and haven’t distributed the first brochure yet. They will be soon forthcoming though, with the July issue of the Allen Letter professional journal. If not a subscriber, call (317) 346-7156 to become one.
And while you’re at it, ask about the new 100 page Manufactured Housing $$$ Primer! Contains the writings, on chattel finance, of more than 20 MHIndustry experts intimate with this timely, and oft confusing, subject. Only $29.95 postpaid.
Geroge Allen, Realtor®, CPM®, MHM
Consultant to the Factory – built Housing Industry & the Landlease Community Real Estate Asset Class
Box # 47024
Indianapolis, IN. 46247
(317) 346-7156
gra7156@aol.com

A Potpourri of Blog Commentary

What readers of this weekly blog are saying about it, and what’s ‘going on & not going on’ throughout the MHIndustry & LLCommunity asset class….

One faithful reader (Defined as someone who’s communicated with this blogger several times during the past 90 weeks of blogging), when reflecting upon the alleged Grand Conspiracy and or Near Perfect Storm endured by, and seriously affecting, HUD Code manufactured housing these days, was inspired to put the matter into prose:

‘While we watch the cheese move, some move and eat their fill.
Tis the right of passage on the open market.
The old way is the old era, and it is now gone.
Today we’ll win with new ideas, despite HUD’s and government’s design for us to fail.’
Lightly edited. GFA

Obvious references here, to the business bestseller Who Moved My Cheese, and last week’s bold blog, announcing the ‘End of an Era & Beginning of Another’. Miss reading it? Just scroll back into the blog archives at this website to read ‘the rest of the story’.

Let’s see, it was 2 June 2010, that fateful day in Elkhart, IN., when during a Manufactured Housing Finance Roundtable, co – hosted by Congressman Joe Donnelly (D-IN) and Federal Housing Commissioner David H. Stevens, the FHFA confirmed distancing itself from ‘all things chattel’, when it came to financing manufactured housing sited in 50,000+/- landlease (nee manufactured home) communities nationwide! Well, a scant two weeks later, the Federal Housing Finance Agency (‘FHFA’) restricts Freddie Mac from providing LLCommunity realty – secured lending! That means Fannie Mae will continue as the sole GSE participating in this mortgage arena. What else might be in the offing? Watch here for news about a new emerging conduit market….

Understand; I only report – and occasionally comment on, MHIndustry & LLCommunity NEWS. I generally don’t ‘make the news’, except when releasing a new annual ALLEN REPORT, announcing the International Networking Roundtable, and awarding Manufactured Housing Manager (‘MHM’) certifications. But readers, like you, often comment on MHIndustry & LLCommunity NEWS from a personal perspective. The following quote, from a respected portfolio owner/operator of LLCommunities, is straightforward and thought – provoking:

“I have said it before and still believe it; the REITs and big operators squeezing people on (high) rent is what started this whole mess. The little guys thought they could simply follow suit. When the big boys became REITs, they gave the (LLCommunity asset class) legitimacy on Wall Street. The money flowed into the REITs and into financing their (and our) home sales, and thus we had the false (housing) boom of the late 90s. This (manufactured housing) industry should be good for a couple hundred thousand homes per year. I am getting tired my friend. But I will push on as I have faith this is the best (housing) product for our market segment. (Prosperity) will return when all the shaking – out is done, and I hope we can be satisfied with our niche and not try to expand it beyond its’ reality.” Lightly edited. GFA

On the East coast this past week, there was a hush hush meeting between LLCommunity owners/operators and a major national name brand lending institution, to talk about the dire and timely need for chattel financing in LLCommunities, for new and resale home transactions. Here’s part of the initial report I received regarding proceedings:

“Our exploratory meeting with…went well, (and) as is frequently the case with such meetings, we ended up discovering areas of interest we didn’t anticipate early on. They are now considering the idea of several veteran LLCommunity owners putting on a ‘MHFinancing 101’ seminar for their clients and non – clients, interested in this form of investing. We’re planning the follow – up meeting.” Lightly edited. GFA

Know what? Assuming this chattel finance initiative, by LLCommunity owners, ‘grows legs’, it’ll be very interesting to hear ‘the progress report’ during 19th International Networking Roundtable (‘INR’) in Phoenix, AZ., 15 – 17 September 2010. It’s already on the agenda!

Now here’s a cryptic paragraph for you. Veteran MHIndustry & LLCommunity folk will know ‘in a heartbeat’ about which timely and historic matter the writer describes. The rest of you will have to be content to wait till an official announcement of approval is forthcoming, and I can ‘splain’ it fully in this weekly blog posting or elsewhere….

“We have gone to the ‘mountain’ one last time, and returned without any darts in our neck. We have succeeded. Considering the benefit to this (manufactured housing) industry, you would think it would be on the nightly news on all channels – but of course it isn’t. This is the biggest change in basic foundation design since the Greeks and Romans started putting rocks in trenches, under walls, for better support (That’s about 3,000 years ago!). It is truly a marvelous engineering discovery and only the MHIndustry can use it. Sadly, installation never was of much interest to most people in this business and it still isn’t.” Lightly edited. GFA

This is exciting stuff! And when we can finally ‘go public’ with it, expect to read the full story – and description of the entire revolutionary process, in the Allen CONFIDENTIAL! business newsletter and the Allen Letter professional journal.

In last week’s blog posting, after describing the paradigm shift intrinsic to the MHIndustry & LLCommunity asset class, beginning at the ‘turn of the century & advent of the new millennium’ during year 2000, and consummated at the aforementioned 2 June 2010 Manufactured Housing Finance Roundtable in Elkhart, IN., I reiterated desirable business model features and changes for HUD Code housing manufacturers and property owners/operators alike. Then there was talk of ways to calculate homesite rental rates in sync with local housing market characteristics (e.g Area Median Income or AMI) as well as property features (e.g. good vs. bad location, all adult vs. family, new vs. functionally obsolete, verbal month to month vs. written long term leases, etc.). Some felt the formulae too simplistic; others decried guidelines altogether, i.e. favoring charging ‘What the market will bear!’, proofing the old bromide: caveat emptor. Fortunately, others take a more enlightened view, seeking a fair balance between the affordability needs of the lessee, and profitability for the lessor. In this instance, the tenant ‘fairness factor’ can be, and increasingly is, enhanced with desirable guarantees related to future rent increases, change of use, ‘closure’, and other resident concerns. FYI. This topic too is already on the agenda of the aforementioned 19th INR @ 15 – 17 September 2010!

Assuming you read this blog during the week of 21 June, you know the Manufactured Housing Institute’s (‘MHI’) annual Summer meeting and legislative session, in Washington, DC., is only three weeks away! If not already a direct, dues – paying member, you should seriously consider becoming one, and attend this meeting! Simply phone Thayer Long @ (703) 558-0678. The agenda he’ll provide is compelling. And in addition, there’re other reasons to attend:

• National Communities Council (‘NCC’) convenes 13 July. If you own/operate one or more LLCommunities in the U.S., this is your national advocacy body! If you don’t participate, and make your views known, you deserve to have happen to you, whatever it is you don’t know about, or support or fight!

• National CONSORTIUM of print & online MHIndustry & LLCommunity trade publications, will hold its’ second meeting during the MHI function. To attend, tell me of your print or online publication(s) and interest in participating.

• Possibility of a planning meeting re the Grand ‘Once & For All’ Tour series of meetings, comprised of actionable seminars and issue discussion groups, scheduled for seven geographic regions throughout the U.S. later this year and during 2011. All this in preparation for the possible launch of an independent, not for profit, Manufactured Housing & Landlease Community Think Tank in year 2012. This is yet another initiative spawned by the aforementioned ‘End of an Era & Beginning of Another’ blog posting from last week.

As usual, I solicit your responses, pro and con, regarding the content of these weekly blog postings. It’s easy to do. Contact me via the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 or via (317) 346-7156, FAX @ (317) 346-7158, email: gfa7156@aol.com; and easiest of all, respond via this website.

Use this contact information to subscribe to the Allen Letter professional journal; order the 21st annual ALLEN REPORT; request an ‘invitation to attend’ the 19th annual International Networking Roundtable; schedule the one day Manufactured Housing Manager (‘MHM’) professional property management class and certification program for your team of on – site and regional LLCommunity managers; even order the recently – released Manufactured Housing $$$ Primer, and FREE copies of the Real Estate Lenders’ Registry, ‘Who Ya Gonna Call in 2010’ list of freelance consultants, and list of three dozen Business Development Mangers (‘BDM’) specializing in Community Series Homes (‘CSH’) for placement in our unique income – producing property type.

George Allen, Realtor®, CPM® Emeritus, MHM c/o Box # 47024, Indpls, IN. 46247

End of an Era & Beginning of Another; In Search of a Formula That Works

If you manufacture homes & or own one or more landlease communities, listen up!

I

Here’s a sampling of responses to last week’s blog, ‘PRO & CON, & Not Much Else!’, describing the public distancing by GSEs, and federal regulators, from anything having to do with HUD Code manufactured housing chattel (personal property) financing pursuant to siting new & resale homes landlease (nee manufactured home) communities:

1) “George, it really is an end of an era, and I’m not the least bit happy about it. What will we do? If we don’t have access to significant long term capital sources for buying, selling and financing homes ourselves, we are in serious trouble. It’s been 10 years in the making, but the ‘perfect storm’ is at its’ climax….”

2) “Business is really tough out here, but my clients are now convinced, we must buy, install, sell, and finance new (manufactured) homes ourselves, if we have any desire to grow and prosper in the next two to five years.”

3) “Here’s a copy of new GNMA guidelines. I’m told the program will require a 10% reserve. That alone will doom the program to non – use, as it is cash flow negative.”

So, what is one to do? To begin with, it depends on one’s business perspective or role in the MHIndustry and or LLCommunity real estate asset class.

First the manufacturers! YOU took two bold steps during the National SUMMIT Meeting at the RV/MH Heritage Foundation’s Hall of Fame facility in Elkhart, IN., on 2/27/09. You entered into dialogue with counterpart owners/operators of LLCommunities from throughout the U.S. Results? You redesigned homes, making them more appropriate for in – community siting, and identified Business Development Managers (‘BDM’s), tasked with growing your market share of homes within this 50,000 property arena. And six months later, at the 18th International Networking Roundtable we labeled your redesigned housing product as Community Series Homes or CSH. So today, when LLCommunity owners/operators access the regularly updated and widely distributed BDM list, they call and ask for floor plans and elevation drawings of CSH models, from which to order new HUD Code homes for infill! Ask me for a free copy of the BDM list.

But there are still as many manufacturers who haven’t figured out this ‘drill’ as there are of you who’ve benefited from it. Despite encouragement to designate additional BDMs, and design more CSH product, it’s been slow to happen. Sp, if you’re reading this blog, and have influence within the two national trade advocacy bodies, MHARR and MHI, please ‘Pass this word’: Selling new HUD homes into LLCommunities is the future of manufactured housing for the time being, maybe even the long haul! And, while you’re at it, give financing more creative thought. Now that GSEs and others, ‘inside the Washington beltway’, have distanced themselves from us, every home manufacturer should/must be aligned with source(s) of wholesale and retail capital, as in the manner of Clayton Homes and CAVCO. If you don’t know who to talk to, give me a call and I’ll provide some names.

Also know, there’s a quiet effort afoot, among some of the largest private and publicly – owned property portfolios, to justify legitimate rekindled interest in, and eventually restore, chattel ‘paper’ for use in the landlease community investment environment, as well as marketing fully compliant collections of such home loans. For more information, as it becomes available over time, follow this weekly blog posting….

Now for the LLCommunity folk! Actually this segue from ‘one era to another’ has been underway ‘for us’ for more than a decade – as was alluded to in one of the three opening quotes. As you likely know from the 21st annual ALLEN REPORT, published in January of this year; among the 500+/- property portfolio folk alone, we’ve seen the total volume of ‘contract sale paper’ held by LLCommunity owners/operators swell from ‘maybe a few million dollars’ in years 1999 & 2000, to more than $ 3 ½ billion dollar by year end 2009! And, last week I read an estimate, published by what appears to be a knowledgeable source, where said total is now approaching five billion dollars plus! So, ‘We’re there, right smack in the midst of a (re)new(ed) business model, one popularized in the late 1970s (When, upon HUD Code implementation, shipments plunged from 575,940 new ‘mobile homes’ shipped in 1972, to an average of 250,000 homes per year over the next 20 years), now popularly known as (property) ‘owner – assisted finance’ of new and resale homes sold on – site!

FYI! Whether you’re already into this new business model, or now seriously thinking about it, be sure to read the July 2010 issue of the Allen Letter professional journal! Why? The entire issue is devoted to describing this paradigm shift occurring in the manufactured housing industry and landlease community asset class. ‘Seven Steps to Success’ selling and financing new and resale homes on – site, including the timely and increasingly important role of nurturing a secondary market for selling used homes, will also be detailed. In addition to that, there’re just as many Bullet Points, identifying the Lessons Learned ‘first time around’ (i.e. ‘back in the 1970s’) that LLCommunity owners/operators must be diligent not to replicate ‘this time around’! Hint. Ever hear of ‘churn’? I hope not, but it’s related to another five letter word, GREED, that helped create our industry and property type’s enduring negative image – unchanged for the past 30 years. Let’s not make those, and other mistakes again!

And there’s a third strategic, upcoming opportunity to bear in mind. With all that’s happening right now, in social, political, and business circles, one can’t do enough to stay abreast of what our MHIndustry & LLCommunity peers are doing successfully – initiatives we should consider implementing as well. And there’s a proven way to do so; by attending the 19th annual International Networking Roundtable in Phoenix, AZ, during 15 – 17 September 2010. The agenda has been set. Marcus & Millichap will lead off at 4PM on 9/15 with their annual LLCommunity Investors’ Symposium, sharing 2010 ‘stats’ and showcasing dozens of such properties for sale. Next morning, Randy Rowe, founder of Hometown America and Green Courte Partners, (and, with David Lentz, heading the management team at American Land Lease) will lead – off as keynote presenter, sharing his informed and insightful ‘State of the MHIndustry & LLCommunity Asset Class’! After Randy? All told, there’re 20 educational seminars and panels scheduled – and CSH model homes on the plaza next to the meeting rooms! Program brochures will be enclosed as lagniappes with the July issue of the Allen Letter professional journal. Since this is a semi – ‘by invitation only’ event, ensure your invitation to attend, by subscribing to the newsletter and or requesting the brochure (and a reprint describing last year’s exciting program, with three CSH models, in Chicago), by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, or (317) 346-7156. Also check this website for Roundtable meeting registration information.

II

OK; by now, if a loyal reader of this blog series (Incidentally, this is the 90th consecutive blog posted during the past nearly two years!), you know my angst about ‘too high rental homesite rents’ in LLCommunities throughout this land. And you likely know I believe LLCommunity homesite rent, ideally, should be somewhere in the neighborhood of one third the dollar amount charged by the largest (comparably sized, square foot wise) conventional apartment or townhouse in the same local housing market. For example, if a 2 or 3BR, 2B apartment (not subsidized) rents for $900.00/month sans water/sewer charges, then a LLCommunity homesite in the same local housing market might/should rent for roughly $300.00/month sans water/sewer charges. Adjustments to these amounts are likely warranted given comparable quality of respective living environments, whether family properties or all adult, even good vs. poor location.

But here’s a new wrinkle, maybe. In the same local housing market where I’ve seen the above $900 – $300 relationship in balance per the 3:1 Rule of Thumb or ratio, I’ve learned, via zipskinny.com, the individual citizen or consumer’s Average Median Income (‘AMI’) is $36,000.00 per year. Hmm. ‘Wonder what, if any, relationship there might be, between a local housing market’s AMI and aforesaid homesite rent?’ Here’s the way it pencils out in the market described in the previous paragraph:

AMI @ $36000.00 divided by 12 months = $3,000.00/month divided by an arbitrary divisor of ‘10’ = $300.00/month target site rent; the very same amount calculated using the aforementioned 3:1 Rule of Thumb or ratio, comparing conventional (3BR2B) apartments & LLCommunity homesite rents.

Know what? Using John Turzer’s rent surveys, I’ve found markets where this formula works ‘spot on’, but not as well in others; apparently having to do with whether looking at family or 55+ LLCommunities. So, what do you think or, better yet, actually experience, in your local housing market, to this end? Does dividing AMI, for your local housing market(s), by 12 months, and then by 10, come up with a homesite rent rate comparable to application of the aforementioned 3:1 Rule of Thumb or ratio? Does it trend in one direction or the other? I’d like to know your thoughts on the subject….

III

What you’ve just read, in parts I & II of this blog posting, is but ‘half the complete story’. For ALL the NEWs on these, and other timely manufactured housing and landlease community matters, you should be reading the Allen Letter professional journal each month! It’s the only print trade media penned and published by individuals active in the MHIndustry & LLCommunity asset class, as business and income – producing property owners/operators; and, participants in most – if not all major industry events, and a direct, dues – paying member of every appropriate national advocacy and trade body, e.g. MHI’s NCC and ULI’s MHCC! To subscribe, at only $134.95/year for 12 monthly issues, phone the MHIndustry HOTLINE listed in paragraph II above, via this website, or simply phone (317) 346-7156. AND, to learn even more firsthand, be present at the 19th annual International Networking Roundtable in Phoenix, AZ., 15 – 17 September 2010! While subscribing, ask for a FREE copy of the next monthly issue of the Allen CONFIDENTIAL! business newsletter…read by most MHIndustry execs!

In the meantime, plan to meet with manufactured housing executives and landlease community owners/operators at the Manufactured Housing Institute’s Summer meeting in Washington, DC @ 13 – 15 July 2010. For registration information, contact Thayer Long via (703) 558-0678. I plan to attend; how ‘bout you? If so, make it a point to talk to me there, about this and other weekly blog postings, giving me your ideas and suggestions on how to make it an even better, useful communication tool for our industry and asset class at large! FYI. We’ll likely have the second meeting of the Print & Online Trade Media CONSORTIUM sometime during the MHI meeting. Interested?

Also let me know personally, if you’re seriously willing to help plan, and or host, a Grand ‘Once & For All’ Tour series of meetings, comprised of actionable seminars and issue discussion groups, scheduled for seven geographic regions throughout the U.S., later this year and during 2011, in preparation for the launch an independent, not for profit, Manufactured Housing & Landlease Community Think Tank in year 2012. Yes, this is a key event(s) spawned by the ‘End of an Era & Beginning of Another’. The question for YOU is, are or will you be an integral part, better yet a leader, within this latest, and maybe largest, manufactured housing and landlease community paradigm shift?

George Allen, Realtor®, CPM® Emeritus, MHM Box # 47024
Consultant to the Factory – built Housing Industry & Indianapolis, IN. 46247
The Landlease Community Real Estate Asset Class (317) 346-7156

PROS & CONS, & NOT MUCH ELSE!
Well attended, lousy room; common focus, many tangents; informative start, weak ending

60 executives from business, government, and federal regulatory agencies – but NO GSEs, gathered, 2 June 2010, in the second story , acoustically challenged, stuffy Athenian Ballroom of a 100 year old downtown Elkhart, Indiana, building . They’d flown in the night before from as far afield as Colorado, Washington, DC. and Florida. Better the next meeting (None was announced, or even hinted at, hence an indication of interest and effectiveness right there!) be held at the RV/MH Heritage Foundation’s mall of Fame, museum and library facility (also) in Elkhart, Indiana.
Originally described as a Manufactured Housing Finance Roundtable, by the time we arrived, it’d been relabeled a Manufactured Housing Summit. Small difference perhaps, but predictive of how difficult it was to keep everyone on point (MHFinance), with so many disparate aspects to and of the subject. And Yes, there was an agenda; but once the group got past Welcome & Introductions (Really weren’t many, just the meeting hosts. Maybe next time they’ll go ‘round the room’, to facilitate networking and participation), and Manufactured Housing Institute’s excellent ‘State of the MHIndustry’ Power Point presentation, the remainder of the morning was a round robin discussion of real estate and personal property -secured lending, as they pertained to manufactured housing.*1
What transpired at this morning meeting? Well, as to substance, I’m going to leave that to folk who garnered the most attention, by design, at this roundtable/summit: Federal Housing Commissioner David H. Stevens, and MHI representatives Dick Ernst and Thayer Long. Just about everyone in the room seemed to have a hobby horse interest to ride – if they even deigned to share their thoughts. Many didn’t. Will tell you this; I was as pleasantly surprised at MHI’s Thayer Long’s passionate remarks challenging an FHFA representative about their ‘chattelless’ Duty to Serve stance; as I was disappointed at MHARR’s Danny Ghorbani’s lukewarm commentary from time to time.*2
What I will share, are some general pro & con observations recorded during the 2 ½ hour meeting.
An eight page, undated (presumably 2 June 2010) memorandum was distributed at the summit/roundtable, re: ‘Title I Manufactured Home Loan Program Clarification and Guidance.’ This was well received, and, hopefully, is a precursor of improved chattel finance conditions for the MHIndustry once Ginnie Mae puts their ‘chop’ on it. Want a copy? Contact Danny, Thayer, or me.
In my opinion, the best – but – dismal summary of MHIndustry’s present day malaise was offered by Larry Keener, president & CEO of Palm Harbor Homes. He described how the affordable nature of HUD Code manufactured housing has been destroyed by cost of capital (i.e. 3 basis point differential between personal property and real estate – secured loans), and, present day competition with ‘short sales’ occurring throughout the site – built resale housing market nationwide. His bottom line? The manufactured housing industry sorely needs ‘a level playing field’ to survive!
Mr. Keener’s apt observations highlighted two additional factors; one repeated over and over at the event – but never with any definition or quantification; and another, while brought up twice, was all but ignored.
In the first instance, ‘affordable housing’ was cited in near mantra fashion, time and again, sans any attempt at definition or description whatsoever. No one in the room had any idea whether the ‘speaker of the moment’ was referencing housing expense factors, the Housing Opportunity Index, housing wage, or workforce housing perspectives. This was an apt example of why everyone involved in housing discussions should go back to the drawing board and agree upon what they’re talking about; otherwise, ‘affordable housing’ and ‘housing affordability’ can – and will continue to mean, whatever the user/misuser, of the moment, wants it to mean!*3
And then there was the perennial issue regarding how manufactured housing is – or should be valued: either via cost – based (book) method, or the comparable sales method used for all site – built housing? This controversial subject is touched upon in the Manufactured Housing Financial Primer (p.29).*4 What it does not say, nor was this brought out at the Summit Meeting, is the MHIndustry, out of one side of it’s mouth, lobbies for a level playing field (e.g. ‘Treat us like housing, not trailers!’), while routinely using the ‘book method’ to generally undervalue homes when repossessed, and or taken in trade for higher priced new ones, widening the loss and profit margins respectively. As long as GSEs (Government Sponsored Enterprises) opt for ‘the easy way out’ by endorsing book valuations of manufactured homes, this double standard will continue to be a proverbial albatross around the industry’s collective neck, dragging it down, down, down. And don’t forget, the GSEs declined to participate in this event! What’s that tell you?
As the roundtable/summit drew to a close, Commissioner Stevens shared his five ‘takeaways’ from this meeting: an openness to chattel finance guidelines and best practices, learn more about lien perfection matters, ascertain ‘real pricing’ of manufactured housing*5, study new duration models re lifetime loan default statistics, and, seek a clearer separation between the characteristics and needs of lenders serving manufactured housing, and those active in conventional housing markets.
Finally; the 800 pound guerilla in the room! Perhaps it’s my affinity for landlease (nee manufactured home) communities, and ‘matters thereto pertaining’, but I found myself wondering, all morning, ‘when’ are they going to talk about how manufactured housing chattel finance relates to the contemporary on – site sale and financing of new and resale manufactured homes within 50,000 such income – producing properties nationwide? Well the matter never really did come up – except when Ed Hussey of Liberty Homes tried unsuccessfully to interest Commissioner Stevens in the aforementioned ‘appraisal issue’. Then, at the very end of the meeting, Lois Starkey, of MHI, asked Gary McDaniel of YES! Communities, to tell the gathered execs about ‘what was going on in the LLCommunity asset class’. Gary was quick to point out this was somewhat off – topic, but went on to describe an ongoing project orchestrated by several major property portfolio owners/operators, to ‘grow’ a new body of chattel loan performance data, to effectively counter the infamous Greentree ‘killer’ stats of years past. Point? This is another worthy aspect of manufactured housing chattel financing that received little to no attention at this (One time?) event.
Will this roundtable/summit produce measurable results? I doubt it – for two reasons. First, had there been any real passion going into this meeting, hints would have been dropped beforehand, to plan to stick around for working sessions during the afternoon, i.e. one – on – one opportunities to learn and discuss various aspects of manufactured housing finance. That didn’t happen. Even more telling, was the obvious and complete lack of public notice or request, for a follow – up session to this one. SO, with no subsequent performance measurement events in place, it’s highly unlikely there’ll be significant performance improvement! For this industry observer the MHSummit simply an educational, worthwhile networking event, but not much more than that.
For that matter, here’s a summary statement that encapsulates where HUD Code manufactured housing and chattel (personal property) finance is, at this time in our industry’s 60 year history:
“Say ‘Good bye’ to the GSE’s as a secondary market for manufactured housing – related (chattel) capital, & ‘Hello’ to landlease (nee manufactured home) community owner – financing of new and resale home transactions on – site, ‘Duty to Serve’ verbiage notwithstanding! And, the Grand Conspiracy, or Near Perfect Storm continues to grow in reality and intensity!” You’ve gotta be asking yourself: ‘Who’s going to be left to manufacture, sell, and finance manufactured homes when all this plays out?’
As always, I welcome your opinions and critique of these views. Reply directly to this blog posting or via the MHIndustry HOTLINE: (877)MFD-HSNG or 633-4764.
******
End Notes:
1. For a copy of MHI’s excellent Power Point presentation, contact Thayer Long @ (703)558-0678
2. MHARR. Manufactured Housing Association for Regulatory Reform @ (202) 783-4087
3. For a detailed treatment of ‘affordable housing’ and ‘housing affordability’, read HOUSING AFFORDOGRAPHY, PMN Publishing, Franklin, IN. 2008
4. Available for $29.95 (postpaid) from PMN Publishing: (317) 346-7156
5. For a clear and startling look at ‘real $ pricing models’ comparing land & home vs. in – community housings sales transactions, from ‘affordable’ and ‘risky’ transaction perspectives, request a free copy of the widely – used ‘Ah Ha!’ & Uh Oh!’ formula page, by phoning the MHIndustry HOTLINE; (877)MFD-HSNG or 633-4764.
Postscript. Want to read even more on the subject meeting in Elkhart, IN? MHI & MHARR have already published summaries penned from their perspectives. What you’ll want to read, however, is Precision Capital Funding’s lengthy, pithy letter to Congressman Donnelly. Phone 9217) 971-3968 to request a copy! It’s interesting this viewpoint is penned by a financier who was not invited to ‘have a seat at the table’ where manufactured housing chattel finance was discussed for 2 ½ hours….
FINALLY,
If you own/operate one or more landlease communities in North America, and haven’t already done so, mark your planning calendar to be in Phoenix, AZ. @ 15 – 17, 2010, for the 19th annual International Networking Roundtable! This is a ‘by invitation only’ event, limited to the first 200 sign – ups. Product and service vendors are welcome to attend as event sponsors. In both instances, contact us for a registration brochure, containing the list of 20+ seminars and panels, scheduled for this year’s event – complete with Show Homes! (317) 346-7156
*****
George Allen, Realtor®, CPM® Emeritus, MHM
Consultant to the Factory – built Housing industry &
The Landlease Community Real Estate Asset Class
Box # 47024

June 2010 National (Manufactured Housing) Month & Much More!
I.
No, there won’t be any fireworks or banners flying, in celebration of National (Manufactured) Housing Month. But, for the first time in a long time, corporate, regulatory and political interests will be collectively focused on factory-built housing at its’ birthplace, in a very public – and hopefully, productive fashion!
On Wednesday, 2 June 2010, Congressman Joe Donnelly (D-IN) will co – host, with Federal Housing Commissioner David H. Stevens, a national Manufactured Housing Finance Roundtable, in the Chamber of Commerce offices in downtown Elkhart, IN. Attendance is limited to 45 interested parties.
While the Manufactured Housing Association for Regulatory Reform (‘MHARR’) and Manufactured Housing Institute (‘MHI’) will be represented at this timely and historic event, only the latter national advocacy body, to the best of my knowledge, will be making a formal Power Point presentation.
Within said Power Point presentation is a list (here paraphrased) of what manufactured housing businessmen and women hope to accomplish at the meeting:
• Identify challenges and engage in productive discussion to solve and resolve them
• Gain understanding of market manufactured housing serves & reasons we’re unique & needed
• Seek expedited deadlines for publication of Title I mortgage letter (This might occur at the roundtable); action by Ginnie Mae to approve existing $ issuers under new Title I program; and, a FHFA directive to implement ’Duty to Serve’ rule and acceptance of Title I loans.
Will these heady, but timely and vital goals be realized at this meeting? Let’s hope so; only time will tell.
Next notable event during National (Manufactured) Housing Month is the proclamation, by Congress, that the week of 14 – 19 June 2010 is National Manufactured Housing Week! While no special events are planned, again – that I’m aware of at this point in time, it’d be appropriate to communicate this notable recognition to employees and customers alike, via advertising, news releases, etc…
II
Now for a commentary on another subject altogether. A question: Is it time for the factory – built housing industry at large, and HUD Code manufactured housing and the landlease (nee manufactured home) community real estate asset class, in particular, to finally launch and fund its’ own formal Think Tank?
What’s a Think Tank? Well, quoting a few lines from an interview with Heritage Foundation’s (a conservative Think Tank) head, Ed Feulner, published in WORLD news magazine (22 May 2010, p. 24) describing his group’s work, “…a think tank that could produce short papers for congressmen, senators, and key staffers that were credible – all the facts upfront, conclusion separated – that were timely.”
For the past five or so years, some of us in the landlease community (‘LLCommunity’) business looked to the then new Manufactured Housing Communities Council (‘MHCC’) product council of the Urban Land Institute (‘ULI’) to maybe fill that, or a similar role, for business entities and advocacy bodies actively involved in manufactured housing’s housing production/distribution, and realty development/investment environments. Well, the MHCC forum has certainly been a lively, productive, even worthwhile opportunity for discussion of industry and asset class issues and concerns, but sans staff, hasn’t scratched the surface of Think Tank production described in the previous paragraph.
Is there a need for independent, capable, credible research and reporting? Yes! At present, the only ‘papers of note’ emanate from two trade bodies with generally different ‘views’ on how manufactured housing should relate to federal regulators, maintain status quo vs. improve national image of our type factory – built housing, even relate to the various segments of the industry. In addition, with the demise of most print publications serving manufactured housing, there’s increasing recognition we, as an industry, ‘must get the word out’ about ‘how’ and ‘why’ we’re this nation’s best ‘affordable housing’ alternative. This will only happen via legitimate research and accurate reporting.
So, what’s the answer? While I’m not entirely sure at this point in time, a plan is indeed coming together. While, as an asset class, we already have a modicum of annually researched and published reports, registries, and the like, we need more – especially within the ‘manufactured housing production/distribution’ segment of the industry.*1 But we’re unlikely to realize this timely and ambitious goal until dedicated resources can be brought to bear ‘when and where needed’, on a continuing basis. Where might such a (Think Tank) resource by ‘housed’? Suggestions, to date, include: underwriting an Academic Fellows position at ULI; sponsor an endowed or perennial chair at a university already demonstrating interest in manufactured housing and the LLCommunity property type; and or, establish a new not – for – profit body whose stated mission would be to engage in Think Tank type research and report preparation, as needed, relative to all segments of manufactured housing and LLCommunities.
How to get started? I’m toying with the idea of launching a state – by – state tour, for lack of a better word, this year and into 2011. I envision the ‘tour’ will be privately and corporately funded, with some expenses offset by registration fees. Initial visit likely scheduled in states with significant MH & LLCommunity presence and interest. What will be covered during these 1 ½ day visits? For starters:
• State of the MHIndustry & LLCommunity asset class, with time for open discussion and sharing of ideas, criticism, etc…
• Encourage support of national advocacy bodies by dint of personal and corporate membership and participation, e.g. MHARR, MHI, NCC, NRC, IREM, etc…
• Promote professional property management training via CPM& MHM programs
• Introduce and encourage personal and corporate financial support of the RV/MH Heritage Foundation’s Hall of Fame, Museum & Library in Elkhart, IN.
• Introduction of the Think Tank concept, and solicitation of ideas and financial support
• Also, as appropriate at the time of the meeting, and what’s going on in the industry and throughout the asset class, tailor one or more hours to cover contemporary topics of interest, e.g. ‘How to Estimate Affordable Price Points for New & Resale Homes’, ‘How to Set Rental Homesite Rents in Sync with One’s Local Housing Market’, ‘How to Estimate the Income Value of One’s LLCommunity’, etc.
And there’s even more than can be added to this list. But it’s the kind of ‘road show’ this industry and asset class has needed for a long long time. What do you think? Interested in being a financial sponsor whose name will appear on every printed program and ad? If so, let me know via the MHIndustry HOTLINE: (877) MFD – HSNG or 633-4764.
III
A brief introduction to Blog Spam. Bet most readers of this posting don’t know such a thing exists. But, sad to say, it does – in large number! For every 25 direct written responses this blogger receives every day, per ’this weekly blog posting’, 24 of them are nothing but blog spam!
What is blog spam? Attempts by individuals and entities who ‘have something to sell’ or a ‘message to share’ – but not a message having anything to do with the subject matter of the blog posting to which they attach. For example, here’re but a few:
• Sender: Cartier Sunglasses. Message: ‘Thanks for Sharing This!’
• Sender: Jingaphones. Message: ‘Unlock iPhone’
• Sender: American T shirt. Message: ‘Thanks for your post.’
• Sender: guccishoes. Message: ‘Thanks for making such a valuable blog.’
• Sender: burberry sunglasses: Message: ‘Very good information. You write it very clean.’
And all those messages must be cleared from one’s site at least once every day. Oh yes, there’re defenses to this nefarious practice, and I’m slowly learning them. But for now? Blog spam is the scourge of online communication.
IV
REMINDERS. Remember to mark your calendar. July 8th in Massachusetts, Mary McBrady will be hosting a day long Open Forum on landlease community matters pertinent to New England. Interested in attending, reach her via (508)460-9523. Newly formed Print & Online Media CONSORTIUM will likely meet, in Washington, DC, the morning of July 13th (during MHI’s Summer meeting…703/558-0678). And on August 2nd, many of us will gather at the RV/MH Heritage Foundation’s annual Hall of Fame Induction Banquet, honoring this year’s inductees. For tickets, phone (800) 378-8694. But most important of all, if you’re a LLCommunity owner/operator or MHIndustry home manufacturer, plan to be in Phoenix, AZ. @ 15 – 17 September for the 19th annual International Networking Roundtable event! For CONSORTIUM and Roundtable information listed in paragraph II above.
End Note.
1. Partial list of annual reports and registries presently researched and published with monthly issues of the Allen Letter professional journal:
• ALLEN REPORT, a.k.a. ‘Who’s Who Among LLCommunity Portfolio Owners/operators
• Official State of the MHIndustry & LLCommunity Asset Class
• National Registries of RE Lenders & Brokers serving LLCommunity owners/operator
• ‘Who Ya Gonna Call During 2010/”…list of freelance consultants serving MHIndustry
• Official Directory of MHIndustry & LLCommunity Print & Online Trade Media Resources
• Official Lexicon or Glossary of MHIndustry & LLCommunity Terminology
• Professional Property Management Training & Certification Programs for LLCommunities
• Product & Service Directory
• Advocacy Body Directory
• Summary of each year’s International Networking Roundtable, contains all speakers’ information
• National State of the Asset Class (‘NSAC’) caucus progress report
• Official Update of the MHIndustry Timeline of Paradigm Shifts since 1972

George Allen, Realtor®, CPM® Emeritus, MHM
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024
Indianapolis, IN. 46247
(317) 346-7156

End Notes.
1. ALLEN REPORT, Lenders’ Registry, Consultants’ Directory, Print & Online Press Overview, etc.

June 2010 National (Manufactured Housing) Month & Much More!
I.
No, there won’t be any fireworks or banners flying, in celebration of National (Manufactured) Housing Month. But, for the first time in a long time, corporate, regulatory and political interests will be collectively focused on factory-built housing at its’ birthplace, in a very public – and hopefully, productive fashion!
On Wednesday, 2 June 2010, Congressman Joe Donnelly (D-IN) will co – host, with Federal Housing Commissioner David H. Stevens, a national Manufactured Housing Finance Roundtable, in the Chamber of Commerce offices in downtown Elkhart, IN. Attendance is limited to 45 interested parties.
While the Manufactured Housing Association for Regulatory Reform (‘MHARR’) and Manufactured Housing Institute (‘MHI’) will be represented at this timely and historic event, only the latter national advocacy body, to the best of my knowledge, will be making a formal Power Point presentation.
Within said Power Point presentation is a list (here paraphrased) of what manufactured housing businessmen and women hope to accomplish at the meeting:
• Identify challenges and engage in productive discussion to solve and resolve them
• Gain understanding of market manufactured housing serves & reasons we’re unique & needed
• Seek expedited deadlines for publication of Title I mortgage letter (This might occur at the roundtable); action by Ginnie Mae to approve existing $ issuers under new Title I program; and, a FHFA directive to implement ’Duty to Serve’ rule and acceptance of Title I loans.
Will these heady, but timely and vital goals be realized at this meeting? Let’s hope so; only time will tell.
Next notable event during National (Manufactured) Housing Month is the proclamation, by Congress, that the week of 14 – 19 June 2010 is National Manufactured Housing Week! While no special events are planned, again – that I’m aware of at this point in time, it’d be appropriate to communicate this notable recognition to employees and customers alike, via advertising, news releases, etc…
II
Now for a commentary on another subject altogether. A question: Is it time for the factory – built housing industry at large, and HUD Code manufactured housing and the landlease (nee manufactured home) community real estate asset class, in particular, to finally launch and fund its’ own formal Think Tank?
What’s a Think Tank? Well, quoting a few lines from an interview with Heritage Foundation’s (a conservative Think Tank) head, Ed Feulner, published in WORLD news magazine (22 May 2010, p. 24) describing his group’s work, “…a think tank that could produce short papers for congressmen, senators, and key staffers that were credible – all the facts upfront, conclusion separated – that were timely.”
For the past five or so years, some of us in the landlease community (‘LLCommunity’) business looked to the then new Manufactured Housing Communities Council (‘MHCC’) product council of the Urban Land Institute (‘ULI’) to maybe fill that, or a similar role, for business entities and advocacy bodies actively involved in manufactured housing’s housing production/distribution, and realty development/investment environments. Well, the MHCC forum has certainly been a lively, productive, even worthwhile opportunity for discussion of industry and asset class issues and concerns, but sans staff, hasn’t scratched the surface of Think Tank production described in the previous paragraph.
Is there a need for independent, capable, credible research and reporting? Yes! At present, the only ‘papers of note’ emanate from two trade bodies with generally different ‘views’ on how manufactured housing should relate to federal regulators, maintain status quo vs. improve national image of our type factory – built housing, even relate to the various segments of the industry. In addition, with the demise of most print publications serving manufactured housing, there’s increasing recognition we, as an industry, ‘must get the word out’ about ‘how’ and ‘why’ we’re this nation’s best ‘affordable housing’ alternative. This will only happen via legitimate research and accurate reporting.
So, what’s the answer? While I’m not entirely sure at this point in time, a plan is indeed coming together. While, as an asset class, we already have a modicum of annually researched and published reports, registries, and the like, we need more – especially within the ‘manufactured housing production/distribution’ segment of the industry.*1 But we’re unlikely to realize this timely and ambitious goal until dedicated resources can be brought to bear ‘when and where needed’, on a continuing basis. Where might such a (Think Tank) resource by ‘housed’? Suggestions, to date, include: underwriting an Academic Fellows position at ULI; sponsor an endowed or perennial chair at a university already demonstrating interest in manufactured housing and the LLCommunity property type; and or, establish a new not – for – profit body whose stated mission would be to engage in Think Tank type research and report preparation, as needed, relative to all segments of manufactured housing and LLCommunities.
How to get started? I’m toying with the idea of launching a state – by – state tour, for lack of a better word, this year and into 2011. I envision the ‘tour’ will be privately and corporately funded, with some expenses offset by registration fees. Initial visit likely scheduled in states with significant MH & LLCommunity presence and interest. What will be covered during these 1 ½ day visits? For starters:
• State of the MHIndustry & LLCommunity asset class, with time for open discussion and sharing of ideas, criticism, etc…
• Encourage support of national advocacy bodies by dint of personal and corporate membership and participation, e.g. MHARR, MHI, NCC, NRC, IREM, etc…
• Promote professional property management training via CPM& MHM programs
• Introduce and encourage personal and corporate financial support of the RV/MH Heritage Foundation’s Hall of Fame, Museum & Library in Elkhart, IN.
• Introduction of the Think Tank concept, and solicitation of ideas and financial support
• Also, as appropriate at the time of the meeting, and what’s going on in the industry and throughout the asset class, tailor one or more hours to cover contemporary topics of interest, e.g. ‘How to Estimate Affordable Price Points for New & Resale Homes’, ‘How to Set Rental Homesite Rents in Sync with One’s Local Housing Market’, ‘How to Estimate the Income Value of One’s LLCommunity’, etc.
And there’s even more than can be added to this list. But it’s the kind of ‘road show’ this industry and asset class has needed for a long long time. What do you think? Interested in being a financial sponsor whose name will appear on every printed program and ad? If so, let me know via the MHIndustry HOTLINE: (877) MFD – HSNG or 633-4764.
III
A brief introduction to Blog Spam. Bet most readers of this posting don’t know such a thing exists. But, sad to say, it does – in large number! For every 25 direct written responses this blogger receives every day, per ’this weekly blog posting’, 24 of them are nothing but blog spam!
What is blog spam? Attempts by individuals and entities who ‘have something to sell’ or a ‘message to share’ – but not a message having anything to do with the subject matter of the blog posting to which they attach. For example, here’re but a few:
• Sender: Cartier Sunglasses. Message: ‘Thanks for Sharing This!’
• Sender: Jingaphones. Message: ‘Unlock iPhone’
• Sender: American T shirt. Message: ‘Thanks for your post.’
• Sender: guccishoes. Message: ‘Thanks for making such a valuable blog.’
• Sender: burberry sunglasses: Message: ‘Very good information. You write it very clean.’
And all those messages must be cleared from one’s site at least once every day. Oh yes, there’re defenses to this nefarious practice, and I’m slowly learning them. But for now? Blog spam is the scourge of online communication.
IV
REMINDERS. Remember to mark your calendar. July 8th in Massachusetts, Mary McBrady will be hosting a day long Open Forum on landlease community matters pertinent to New England. Interested in attending, reach her via (508)460-9523. Newly formed Print & Online Media CONSORTIUM will likely meet, in Washington, DC, the morning of July 13th (during MHI’s Summer meeting…703/558-0678). And on August 2nd, many of us will gather at the RV/MH Heritage Foundation’s annual Hall of Fame Induction Banquet, honoring this year’s inductees. For tickets, phone (800) 378-8694. But most important of all, if you’re a LLCommunity owner/operator or MHIndustry home manufacturer, plan to be in Phoenix, AZ. @ 15 – 17 September for the 19th annual International Networking Roundtable event! For CONSORTIUM and Roundtable information listed in paragraph II above.
End Note.
1. Partial list of annual reports and registries presently researched and published with monthly issues of the Allen Letter professional journal:
• ALLEN REPORT, a.k.a. ‘Who’s Who Among LLCommunity Portfolio Owners/operators
• Official State of the MHIndustry & LLCommunity Asset Class
• National Registries of RE Lenders & Brokers serving LLCommunity owners/operator
• ‘Who Ya Gonna Call During 2010/”…list of freelance consultants serving MHIndustry
• Official Directory of MHIndustry & LLCommunity Print & Online Trade Media Resources
• Official Lexicon or Glossary of MHIndustry & LLCommunity Terminology
• Professional Property Management Training & Certification Programs for LLCommunities
• Product & Service Directory
• Advocacy Body Directory
• Summary of each year’s International Networking Roundtable, contains all speakers’ information
• National State of the Asset Class (‘NSAC’) caucus progress report
• Official Update of the MHIndustry Timeline of Paradigm Shifts since 1972

George Allen, Realtor®, CPM® Emeritus, MHM
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024
Indianapolis, IN. 46247
(317) 346-7156

End Notes.
1. ALLEN REPORT, Lenders’ Registry, Consultants’ Directory, Print & Online Press Overview, etc.

MHI’s Three Point Plan; CONSPIRACY vs. Suicide, & Overlooked Opportunities!

I

No one was more pleased than this blogger, to read Manufactured Housing Institute’s ‘Three Point Plan to Move the Manufactured Housing Industry Forward’! It appears, around the same time I was penning the blog: ‘Recent MHCC Meeting Presents Unique Opportunity to Juxtapose MHARR & MHI Views on Critical & Timely MHIndustry Issues’, MHI execs were experiencing a dose of ‘MHReligion’ as well. Per Thayer Long’s column in the Journal, his epiphany occurred during the Manufactured Housing Congress in Las Vegas during April.

MHI’s Three Point Plan “…agenda includes improving (chattel) financing for our (home buying) customers, advocating for implementation of updates to the manufactured housing building code (per Manufactured Housing Improvement Act of 2000), and protecting preemption of the federal building code.” MHI @ 5/14/10. If you’d like to read about this in detail, contact Thayer Long via (703) 558-0678, or read his column in the Journal.

So, how or why is MHI’s Three Point Plan ‘major MHIndustry news’? On one hand, I don’t know anyone (OK, maybe there’s one industry exec.) who’d argue MHI hasn’t been on the forefront of ‘improving (chattel) financing for our customers’ these past 18 months re: “…FHA Title I improvements and GSE’s ‘duty to serve’…”. However, many would opine MHI has been far less than stalwart in pressing for full implementation of the Manufactured Housing Improvement Act of 2000; and, not out to ‘Protect (Federal) Preemption At All Costs’ – until now! From this industry observer’s perspective, those last two points have been the perennial, lonely mission of the Manufactured Housing Association for Regulatory Reform or MHARR. To revisit that reality in detail, reread the aforementioned blog, juxtaposing MHARR & MHI published views regarding the recent MHCC meeting, some now say debacle, in Oklahoma.

II

In mid February of this year, I posted a blog column titled, ‘ManuFractured housing, circa 2020 or before, by dint of a Grand CONSPIRACY or Near Perfect Storm?’ Therein I described, in general terms, the organizations, businesses, trends (e.g. consolidation), and circumstances (e.g. paucity of third party chattel financing), ganging up on the already struggling HUD Code manufactured housing industry. Bottom line? With little to no improvement in all four areas, expect the annual HUD Code shipment total to further plunge from its’ abysmal 49,789 ‘new homes shipped’ during 2009, down to a mere 250 homes by year 2020 or before! At that point the MHIndustry will be dead!

Yes, that blog posting prompted lively discussion for awhile; mostly positive, as ‘really concerned senior (manufacturing) executives’ began to talk about coming together for a third NSAC caucus type meeting*1, among themselves, and probably a few other ‘players’ willing to invest time and resources to ‘Save Our Industry’! But even that once hopeful talk has dissipated, as interest in ‘coming together’ has waned…Too bad.

Then along comes this thoughtful but troubling missal from Martin (‘Marty’) V. Lavin, esquire, out of Vermont, and quoted in part:

“…grasp the obvious…HUD Code housing has been committing suicide for over 20 years. It operates on a Failed Business Model. It started with the securitization and sale of terribly flawed bonds for the industry’s chattel loans through 2003, which caused huge investor losses, and has yet to see any industry response to allow rational, profitable lending by third party lenders.”

“And while very heavy buying demand for our product exists, it comes from (home) buyers infrequently qualified for the available, profitable lending. It therefore remains for the industry to either work on getting profitable lending in the ‘subprime’ tier of present demand, or increase demand from higher credit (home) buyers who can be successfully financed by traditional lenders. The other method of continuing the industry is ‘buy here, pay here’, which seems a poor solution as the primary source of industry financing….” (Parenthetically: ‘Why is this such a ‘poor solution’ Marty’?)

He ends thusly: “It is astounding to me, at this late date, there still continues to be confusion about some grand scheme to undo HUD Code housing. There is no need for a scheme, the industry has done a grand job on its own.”

Not everyone agrees with Marty’s suicide view. Following information was emailed to me, in response to a more recent blog posting – describing a chain of events otherwise unknown to most of us in the MHIndustry, It too supports the Grand CONSPIRACY or Near Perfect Storm that’s unfolding these days:

“They (a national association of homebuilders) were caught with their pants down at the International Code Council meeting, when the fire sprinkler industry paid for nearly 1000 fire fighters to attend (i.e. compensated airfare & meals) the national code change hearings, to vote ‘mandatory fire sprinklers’ into (housing’s) Model Code. Now, notwithstanding the best of (the national association of homebuilders) efforts, pleading, begging, and threatening, it is not gaining ground getting the sprinklers back out of the code! The fire sprinkler industry is also putting tremendous pressure on states desperately trying to remove (home) sprinkler requirements from codes being considered for adoption. (This body) is as impotent as MHI, and much less ‘engaging’ than MHARR. (It) is fighting to keep stick – built housing from dying, and this opponent has greater funding than HUD -– the very agency who should be using federal preemption to protect manufactured housing from this expensive, ‘killing’ regulatory incursion.

My response? Like many Big Picture events in life and business, the overarching reason is probably a combination of factors, as Marty describes them, along with considerations written into the aforementioned Grand CONSPIRACY or Near Perfect Storm blog. So, why don’t you go back and reread it yourself, ponder all points, and let me know your opinion on this matter. No matter what, we’ll soon be ‘dead’ as an industry if we don’t mobilize SOON to regain significant market share in the housing market!

III

Jerry Govan is a veteran California land developer in general, landlease (nee manufactured home) communities, in particular. Now living in Mesa, AZ., with his wife Donna, they’ve recently released a motivational book titled, Take the ‘E’ Out of Ego & Go! Just finished it and it’s an entertaining ‘read’. Order via www.EoutofEGO.com

Jerry recently wrote to share his thoughts regarding ‘Overlooked Opportunities in Today’s Housing Marketplace’. Here’s a brief digest of ideas from Jerry’s musings:

“The first overlooked opportunity, in my opinion, is buying finished (scattered or in subdivisions, fee simple) lots at bargain prices, and creating ‘land and home’ packages” thereon.

“The second part of the market being overlooked is defunct townhouse projects. These lots are not attractive to a stick builder. However these attached unit lots can be rezoned into smaller lots and filled with smaller homes” of the manufactured housing type. First time buyers or empty nesters, who desire to downsize, are a consistent market.”

Jerry goes on to explain, step by step, how he – and other developers, specializing in manufactured housing, go about this process in a routine fashion. If you’d like to learn more, contact him via (702) 498-1976 or jerrygovan@aol.com

IV

OK, here they are; the ‘Important Announcements in the Offing’, about which I hinted in last week’s (5/26/2010) blast email message heralding Blog # 86 re ‘Sam Zell’s “trailer park company” (morphing) into an “RV company”’. Both have to do with the upcoming (15 – 17 September 2010) 19th International Networking Roundtable in Phoenix, AZ, and involve the fielding of two rather historic but very timely panel presentations:

In the first instance, we’ve long needed a ‘joint presentation of views regarding the regulatory affairs governing the HUD Code manufactured housing industry’. This will happen as senior representative from MHI and MHARR ‘make their respective cases’ regarding this pithy topic. Then we’ll open the floor for questions and encourage discussion. This is the first time such a public forum has been held on this topic!

Just as important, and equally timely, is the panel ideally featuring representatives from the two home lending processes now common in landlease community environs: ‘buy here – pay here’ and ‘captive finance’. Here too, proponents of both views/procedures will ‘make their case’, followed by questions from the floor and open discussion.

And, of course, we’ll also have the ever popular, annual Real Estate Lenders/Brokers Panel, where we’ll learn what finance programs are presently available and ‘reasons’ why we should patronize various lenders and loan brokers.

To ensure your name, or that of your firm, is on the Invitation List to this ‘by invitation only’ annual, international event for landlease community owners/operators, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Attendance limited to 200!

V

Reading this blog each week is merely scratching the surface of what an informed executive and entrepreneur should be reading and absorbing about the manufactured housing industry and LLCommunity asset class. At the very least, he or she should also be digging into each issue of the Allen Letter professional journal! Nowhere else will you find the in depth news reporting, calendar of events, lagniappes, and challenging MH Ronin column, read by so many of your peers. Subscription is only $134.95/year (12 issues), accompanied by a FREE copy of the ALLEN REPORT (a.k.a. ‘Who’s Who Among Portfolio Owners/operators of LLCommunities Throughout North America!’) – otherwise costing $250.00 per copy! And then there’s the Allen CONFIDENTIAL! business newsletter read by most senior executives throughout the MHIndustry and LLCommunity asset class. News contained therein is generally unavailable anywhere else, and usually 30 – 60 days before it sees light of day elsewhere. $750.00/year to subscribers to Allen Letter professional journal, otherwise $950.00/year.

Bought your copy of the Manufactured Housing Finance Primer yet? Released at the MHCongress in Las Vegas, more than half the initial print run is gone! Don’t miss obtaining this ‘first ever’ 100 page collection on just about every aspect of chattel finance as it pertains to manufactured housing and landlease communities. $29.95 postpaid via MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 or (317) 346-7156.

VI

In closing, here’re two late – breaking news bites for you. Just saw the extensive list of article titles to be featured by Manufactured Home marketing Sales Management (ezine) @ www.MHMSM.com Check it out!

If like me, you didn’t know the RV/MH Heritage Foundation in Elkhart, IN., is struggling financially – like many of us, here’s an immediate opportunity to help! The foundation is in the midst of “…a ‘special fundraising effort’, looking for 100 supporters to give a gift of $1,000 apiece, to raise $100,000 to meet (their) operational needs for 2010.” To date they’ve collected $28,175 of that goal. Are you in a position to help? If so, phone (800) 378-8694 or (574) 293-2344. And while you’re on the line, ask them to send you information about the upcoming Hall of Fame Induction Banquet scheduled for 2 August, at their beautiful facility in Elkhart, IN. Hundreds of MHIndustry and RV Industry execs and their families will be present.

*****
End Note.

1. NSAC caucus type meeting. First occurring @ 2/27/08 in Tampa, FL., as 100+ LLCommunity owners/operators convened to discuss the future of the MHIndustry in general, and their real estate asset class in particular. Result? Identification of Five Action Areas that continue, to this day, to guide mid and long range planning among these businesses. Second NSAC caucus occurred @ 2/27/09 in Elkhart, IN., as 100+ HUD Code home manufacturers and LLCommunity portfolio owners/operators convened, for the first time in 50 years, to figure out how to work together to market and sell more new HUD Code homes into this unique income – producing property type. Result? In some local housing markets, as much as 50% of new home production is sited in LLCommunities!

*****

George Allen, Realtor®, CPM® Emeritus, MHM
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024
Indianapolis, IN. 46247
(317) 346-7156