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

Blog # 486; Copyright @ 2 June 2018; community-investor.com

Perspective. ‘Land lease communities, previously manufactured home communities, & ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the sole national advocate, voice, official ombudsman, historian, research report & online communication media for all North American LLCommunities.

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance, a.k.a. COBA7, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

COBA7 Motto: ‘U Support US & WE Serve U!’ Goal of its’ print & online media =
to not only inform & opine, but to transform & improve MHBusiness performance!
______________________________________________________________________

INTRODUCTION. Finally, in 2018, a rallying cry, an apt theme, a worthy goal, for the manufactured housing industry! Here it is:

Make Manufactured Housing Great Again!

Yes, you’re reading that right! It ‘says it all’, hinting at our turn of the century loss of easy access to chattel capital, to the reality that quality, energy efficient, attractive HUD-Code manufactured housing can be, & is, the practical answer to the ‘affordable housing’ crisis!

There’s Work to be Done, to MAKE MANUFACTURED HOUSING GREAT AGAIN! It begins with addressing and correcting a number of issues afoot in our business model today, beginning with Parts I & II following. Plus, is the manufactured housing trade press up to the task of promoting this end, or still mired in backstabbing & innuendo?

I.

What’s Wrong With Land Lease Communities Today!

Here’s a paraphrase of recent remarks made by a respected land lease community portfolio owner/operator, who happens to be a certified Manufactured Housing Manager (‘MHM’) and member of the RV/MH Hall of Fame:

“Your experience with neighboring communities that went downhill, reputation and appearance-wise, during 30 years of passing from one owner to another, is a sad but accurate testament to what happens when owners/operators don’t understand the cost of maintaining, let alone upgrading such properties; don’t have the funds to do so; or just don’t care.

“I cringe every time I hear someone talk of these communities as being ‘cash cows’ – ready for the milking; real estate brokers casually talk of how easy it is to upgrade; and, others advocate ‘fix & flip’ strategies. Every time someone overpays for one of these communities, the writing is on the wall, warning the rest of us will suffer the consequences.”

There’s nary a land lease community owner reading these words who hasn’t experienced similar scenarios, whether they’ve suffered the consequences of being a neighbor to such malaise or profiteering – or, sorry to say, are guilty of it themselves! Yes, this is where the image improvement, affordable housing, and desirable lifestyle cycle begins and ends. Where do your properties fit into this perennial cycle?

So, what are you doing; what are you willing to do, as a land lease community owner, to MAKE MANUFACTURED HOUSING GREAT AGAIN!?

II.

“Post-production sector…weak link in…MHIndustry growth & progress.”?

MHARR’s recent Press Release (June 2018) poses that question as a statement. Which is it? The answer likely lies in accords with one’s perspective on the matter. For example; it’s a given, HUD-Code housing manufacturers, the Big Three C firms in particular – who controlling 70%+/- national market share, are in the driver’s seat at the Manufactured Housing Institute they fund. So, there one finds the Strong Link to MHIndustry growth & progress.

Weak Link? The post-production sector. In fairness, this industry observer can only opine on one of several sectors, that comprised of land lease community owners/operators nationwide. And yes, in my opinion, that sector continues to ‘go begging’ for attention and support, via advocacy and representation, within and outside Washington, DC. Not much point here, to repeat the ills and shortfalls of leadership to date; but rather, what should occur, what must occur, going forward, to

Make Manufactured Housing Great Again!

And what might those matters be? Referring to the same MHARR Press Release, five tasks are recommended for attention to MHI and or, as MHARR puts it, “a new independent, collective, national post-production association.”. Heavily edited, they include:

• Aggressively engage in all aspects of manufactured housing consumer finance 1) including secondary market support for – and securitization of – all types of manufactured home loans…”, & 2) establish secondary market for home sales.

• Effectively oppose local regulatory and zoning barriers to all forms of affordable housing, and the development of land lease communities.

• Ensure reasonable, cost-effective housing installation and placement criteria promoting balance between regulation and affordability. Frost Free Foundations!

• Promote professional property management within land lease communities, as well as strong, effective representation and advocacy on the national level.

• Commit to and engage in national brand advertising, to stimulate and maintain growth and prosperity throughout the manufactured housing industry.

No question but that they’re many other measures to achieve this end, but it’s a start. Perhaps the overarching goal, among all manufactured housing-related trade sectors should simply, to

Make Manufactured Housing Great Again!

III.

Manufactured Housing Press in Transition!

Once there were three (2010), then there was none (2016). Manufactured housing print trade publications: Manufactured Home Merchandiser, Community Management, and The Journal. And during the one year (2017) hiatus we had just two subscriber-supported print trade newsletters, the Allen Letter professional journal, and The Allen CONFIDENTIAL! business newsletter, keeping us informed – along with occasional abut issue pithy Press Releases from MHARR and newsy notes from MHI..

Today, since the January 2018 Louisville MHShow, we have MHInsider, published by MHVillage, DATACOMP of Grand Rapids, MI. To date, they’ve published a Special Tunica MHShow issue, followed by a Spring edition, and now we await a Summer edition. Are you receiving and reading MHInsider magazine? To do so, contact (800) 397-2158.

What else is happening with the manufactured housing trade press? Besides the three print publications just named, there are online ezines and an intermittent blog posting. But here online, in this industry observer’s opinion, ‘lies the rub’ – as in irritant. Given the relative ease and minor expense of publishing online, by anyone journalism qualified, experienced, or often not, it’s easy to understand how some manufactured housing news has slipped into the present sad state of trade news reporting.

One online ezine, reportedly widely known – in this industry observer’s opinion – risks discrediting, as it brick bats those whose words and actions don’t mirror or support the editorial stance, and industry agenda, espoused by said ezine. One way to evaluate practitioners of such a fifth estate, is to number, identify, and critique the writing quality its’ stable of writers.

Another, otherwise information-packed, reputable ezine looks, if not feels, like a bona fide print magazine, as one ‘turns the pages’ using a computer mouse. The problem here though, is the publisher – again, in this observer’s opinion – overexposes two of its’ writers, to the extent the ezine increasingly referred to as being ‘their magazine’. Not true, and hopefully that peccadillo will change with time.

Blog posting. Yes, it’s the one you’re reading right here. For a very long time (i.e. 400+ postings during eight years) it appeared every Sunday morning, but not anymore. To ease the workload, it was deemed wiser to ‘post’ when industry and asset class news is timely and worthy to be posted – and when time is of the essence. Today, this blog goes out to hundreds (not thousands, as used to be the case) of select blog ‘floggers’ (readers).

So, where does all this leave today’s manufactured housing trade press? No longer are we in near complete disarray, as was the case during 2017; but certainly not where we need to be if we’re going to reach out and attract homebuyers and site lessees to our affordable housing product and lifestyle, and…

Make Manufactured Housing Great Again!

***

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

Blog # 485; Copyright @ 27 May 2018; community-investor.com
Perspective. ‘Land lease communities, previously manufactured home communities, & ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the sole national advocate, voice, official ombudsman, historian, research report & online communication media for all North American LLCommunities

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance, a.k.a. COBA7, use Official MHIndustry HOTINE: (877) MFD-HSNG or 633-4764.

COBA7 Motto: ‘U Support US & WE Serve U!’ Goal of its’ print & online media =
to not only inform & opine, but to transform & improve MHBusiness performance!
_____________________________________________________________________

INTRODUCTION. Here’s what follows: I = significant semi-announcement; II = 82 years of national MH advocacy; III = key places to be August-October; IV = new Desk Reference edition of SWAN SONG available for purchase; & V = the story no one knew.

I.

National Association of Manufactured Housing Community Owners (‘NAMHCO’)

In case you haven’t heard, there’s a new national advocacy presence ‘soon to be’ on the manufactured housing industry scene! Being formed to represent and advocate for business interests of land lease communities, from the smallest to largest in size, by rental homesite count.

Where do I stand on this potentially controversial matter? As administrator of COBA7, I am not one of NAMHCO’s organizers, though I certainly understand the pent-up frustration of state MH associations and property owners, feeling underserved by the three present day national MH advocates. Today’s status quo relative to the realty asset class? In my opinion,

Manufactured Housing Association for Regulatory Reform is 100% HUD-Code housing manufacturer focused. Land lease community owners/operators are not eligible to belong. Though MHARR does advocate for a new national presence to represent all non-manufacturing segments of the manufactured housing industry. (202) 783-4087

Manufactured Housing Institute is the ‘broad brush’ national advocate serving all segments of the manufactured housing industry. It is primarily financed and perennially led by the ‘Big Three C’ HUD-Code housing manufacturers: Clayton Homes, Champion Home Builders (soon to be, I believe, Skyline Champion), & Cavco Industries. MHI, through its’ National Communities Council division, since 1996, has, in this industry observer’s opinion, given little more than lip service to the land lease community real estate asset class it claims to serve. (703) 558-0675
Community Owners (7 Part) Business Alliance was launched in early 2014 to serve the product and service needs of land lease community owners/operators nationwide. COBA7 is the source of the (29 years running) ALLEN REPORT (a.k.a. ‘Who’s Who Among Land Lease Community Portfolio Owners/operators Throughout North America!’), more than a dozen Signature Series Resource Documents (‘SSRDs’), e.g. National Registry of ALL Lenders!; the Allen Letter professional journal & the Allen CONFIDENTIAL! business newsletter. Also host of the (27 years running) Networking Roundtable (next one, 5-7 September in Indianapolis, IN.); unique deal-making opportunities; and most important, the popular Manufactured Housing Manager professional property management training & certification program – boasting well more than 1,000 MHMs owning/operating LLCommunities in the U.S. & CN. To affiliate, do so via Official MHIndustry HOTINE: (877) MFD-HSNG or 633-4764

Postscript. Not that you need to know this, but to underscore my neutrality in this matter; if I was naming this new national MH advocacy entity, it’d not be manufactured ‘housing’, but ‘home’. And more than likely, I’d opt for the contemporary trade moniker National Association of Land Lease Community Owners. Nuff said, from me anyway.

II.

82 Year History of National Advocacy in Manufactured Housing

The following information gleaned from MHI’s website (MHI.org); Bruce Savage’s The First 20 Years! – a comprehensive history of land lease community advocacy via MHI’s NCC division, from 1996 thru 2016; and, George Allen’s SWAN SONG (a 47 year history of the realty asset class, & official record of manufactured housing shipments from 1955 to the present day).. Here we go:

(The) Trailer Coach Association was formed 5 March 1936 in Los Angeles, CA.

Mobile Homes Manufacturers Association was formed, via name change, during August 1936; moved to Chantilly, VA in 1972; then to Washington, D.C. in 1974; and then, following a 1975 name change to the Manufactured Housing Institute, to Arlington, VA.

National Manufactured Housing Federation was formed in 1977, and eventually represented 41 states by 1983. The NMHF became the Federated States Division of MHI in October 1991, effectively uniting ‘all aspects of the manufactured housing industry – suppliers, manufacturers, retailers, and communities, into one association body.’ MHI

Manufactured Housing Association for Regulatory Reform was launched during 1986 by smaller, regional HUD-Code home manufacturers desiring stronger resistance to attempts at increased regulation of the manufactured housing industry, post 1976 implementation of the HUD-Code. MHARR continues to lobby that narrow, but important, focus to the present day. And is informally referred to as the ‘Washington watch dog’ for the manufactured housing industry!’

Industry Steering Committee, an ad hoc group of 19 (then) manufactured home community owners who met in Indianapolis, IN., August 31, 1993, to form the short-lived, albeit much needed ISC, to represent this unique, income-producing property type, when attendees (i.e. large property portfolio firms) launched IPOs (Initial Public Offerings of stock), as real estate investment trusts (REIT), during 1994 & 1995.Heretofore, representation had been handled by MHI, using a committee of volunteers. During the next 2 1/2 years, ISC member meetings with MHI led to formation of an Interim Communities Division (‘ICD’) that, in turn, led to the debut of the….

National Communities Council on 1 January 1996, under the leadership of James Ayotte. Division status would be conferred on the NCC more than a decade later. For a comprehensive history of the first two decades of the ISC cum ICD cum NCC, read Bruce Savage’s The First 20 Years! An excellent ‘read’. Available for the ‘asking’, as long as copies remain in stock, by phoning (317) 346-7156.

Community Owners (7 Part) Business Alliance, one way or another, traces its’ roots to the publishing of Mobile Home Park Management in 1988 (now in its’ 6th edition & retitled as Land Lease Community Management); the annual ALLEN REPORT in 1989; and soon thereafter, the Allen Letter; two industry classics published by J. Wiley & Sons, NY; the Manufactured Housing Manager professional property management training & certification program; and most recently, publication of the history of land lease communities since 1970, as told in SWAN SONG. With all that said, know COBA7 was formally launched in January 2014, serving the ongoing product & service needs of land lease communities throughout North America! For more information, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

National Association of Manufactured Housing Community Owners, or NAMHCO.

Where will manufactured housing and land lease community national representation and advocacy go from here? That we will certainly have to wait and see!

III.

NOW is TIME to PREPARE for the FOLLOWING:

MHAlive! ‘think tank’ on 6 August 2018 at the RV/MH Hall of Fame in Elkhart, IN., from 9AM to Noon! Theme? ‘Solving Our Nation’s (Lack of) Affordable Housing, with Factory-built Housing & Land Lease Communities!’ & other HOT TOPICS at the time! Cost? Minimal, but RESERVATIONS a MUST, by phoning (317) 346-7156.

Writers’ Workshop: ‘Who Will Preserve Your (Personal or Corporate) Legacy…as a manufactured housing or community businessperson? Answer: YOU! Interested? Join us at the RV/MH Hall of Fame from 1-3PM on 6 August 2018. Again, RESERVATIONS a MUST, by phoning (317) 346-7156. And again, cost = minimal. Just enough to cover cost of a new HOW TO booklet on this important subject, and meeting-related expenses.

RV/MH Hall of Fame (‘HOF’) Induction Banquet, evening of 6 August 2018, at the RV/MH Heritage Foundation’s museum & library facility in Elkhart, IN. RESERVATIONS a MUST, by phoning (574) 293-2344. And if you’re a HOF member, wear your distinctive green blazer to the banquet!

Manufactured Housing Manager (‘MHM ‘), one day, professional property management training & certification session on 5 September 2018, at the Alexander Hotel in downtown Indianapolis, IN. Cost? Only $295/MHM candidate. No test. To register, phone (317) 346-7156 or visit www.getmeregistered.com/COBA7NRT2018

27th annual International Networking Roundtable, 5-7 September 2018, at the Alexander Hotel in Indianapolis, IN. Frankly, you won’t believe the agenda and lineup of presenters until you read the event brochure. Visit getmeregistered.com/COBA7NRT2018 Attendance limited to 200, so don’t delay! Also RV/MH HOF members welcome to wear their distinctive green blazers to both evening receptions at this sterling industry event!

SECO Conference, 9-11 October 2018 in Atlanta, GA. If you haven’t patronized the fastest growing regional MH event in the U.S., make this one your first of many visits! For information, reach out to genevieve@roane.com

IV.

Purchase SWAN SONG, 2nd edition!

Upon widespread request, we’ve updated, enlarged, and improved the Collector’s Edition of SWAN SONG, first sold during the Networking Roundtable in September 2017. This new Desk Reference Edition contains a new chapter (detailing resident-owned community history), the latest (#29) ALLEN REPORT, and much much more.

And here’s the Best Part. Until 1 August 2018, you can buy your copy of the new Desk Reference edition for the pre-publication price of only $24.95 (includes shipping & handling). After 1 August, the retail price will jump to at least $34.95, possibly higher. So, don’t miss this opportunity, order your copy today by phoning (317) 346-7156.

V.

The Story No One Knew…
Friend or associate? Go to www.dailyjournal.net2018/05/26opening_up/ GFA

***

Blog # 484; Copyright @ 1 May 2018; community-investor.com

Perspective. ‘Land lease communities, previously manufactured home communities, & ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the sole national advocate, voice, official ombudsman, historian, research report & online communication media for all North American LLCommunities

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance,
a.k.a. COBA7, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

COBA7 Motto: ‘U Support US & WE Serve U! Goal of its’ print & online media =
to not only inform & opine, but to transform & improve MHBusiness performance!
________________________________________________________________________

INTRODUCTION: What’s Hot, Hot, Hot, Hot? Four of five parts to this blog posting, all pertaining to HUD-Code home sales and seller-financing within land lease communities!

The fifth and final part is also Hot! An exciting announcement and advertising opportunity ‘never before offered’, ensures your firm enjoys an enduring place in manufactured housing and land lease community recorded history!

I.

On-site New MH Sales Lessons Learned

Here’re words of wisdom from a small property portfolio owner of land lease communities, based on personal & corporate experience since the turn of the century.

“We learned the hard way, we’re better off in the long run, waiting for the right homebuyer/site lessee to come along! The ‘winning product & finance
combination’ for us is a new HUD-Code multisection manufactured home; a substantial down payment of 10-15%; and debt-to-income (‘DTI’) ratios of 30 percent ‘front end’ (i.e. mortgage PITI & site rent together) & 40 percent ‘back end’ (PITI, site rent, other debts), relative to proven source(s) of income.”

Other factors that make this owner’s transactions ‘work’ (i.e. no defaults to date!) include: good quality Community Series Homes, not ‘bargain basement’ models available from some factories; smaller profit margins than historically available via independent (street) MHRetailers; and, thorough screening and qualifying of prospective homebuyers.

II.

Biggest Disconnect in Manufactured Housing Today?

New HUD-Code home sales & seller-finance training for land lease community owners!

Seriously. It simply, with one notable exception, is not happening! We are no longer the manufactured housing industry where new HUD-Code homes are distributed (‘sold’) by independent (street) MHRetailers. With the turn of the century disappearance of easy access to chattel capital, for homes going into land lease communities, ‘dealers’ have also disappeared, and community owners – to survive and thrive, must buy new homes, sell them on-site, often seller-financing the transactions.

So, who trains community owners/operators to ‘buy, sell, & finance’ new HUD-Code homes on-site today? Virtually no one! Sure, factories ‘talk the talk’, but how many reps ‘walk the walk’, truly knowing and understanding the ‘basics & nuances’ of land lease community operations, where affordable product pricing – per Area Median Income (‘AMI’) & Annual Gross Income (‘AGI’) qualifiers, are concerned? Also the critical importance of ‘selling lifestyle’ and creating enduring annuity income – as key factors.

The sole exception? IMHA/RVIC (Indiana), on 8 & 9 May, at the RV/MH Hall of Fame in Elkhart, once again offers Two Days of New Home Sales Seminars & Plant Tours, for as many as 200 registrants. That’s only a week away! So don’t delay. Visit www..imharvic.org/homesalesplanttours/ Or, phone (317) 247-6258 X 14. Be there!

FLASH! Attend and I will give you a FREE 3X5 plastic wallet card featuring ‘Four Steps to Selling & Financing New Homes in LLCommunities’, & ‘Six Right Ps of Marketing’; plus a copy of the popular AMI/AGI tool titled: ‘Ah Ha! & Uh Oh! Worksheet’ for calculating affordable (& risky) manufactured housing price points. So, ‘be there’ to get the practical education and takeaway tools you need to succeed in new home sales….

To the best knowledge of this industry observer, this is the ONLY EDUCATIONAL PROGRAM on this timely and strategic subject matter, offered anywhere in the U.S. & Canada today! Don’t miss this decidedly rare opportunity to learn HOW TO effectively fill vacant rental homesites in land lease communities! Hope to see you there! GFA

III.

MH Obsolescence Outpaces New MH Shipments (? or !)

Was hoping to have this ‘question or exclamation’ answered and quantified before now. Not! But will do so when COBA7-sponsored research is complete. In the meantime, if YOU can shed statistical light on this interesting and telling trend topic, please let me know ASAP via gfa7156@aol.com. This phenomena, once proven, could be a manufactured housing production and shipment game changer.

IV.

Taking the Home Sales & Financing Show ‘On the Road’

Yes, you read that right. ‘New HUD-Code home sales & seller-financing in land lease communities’ training is so critical today, that two freelance consultants will visit your state, or firm, to team teach a one day educational program on the four part topic:

• Getting one’s property ‘ready for on-site sales’ of new HUD-Code homes

• Buying the right type and priced home, from the factory, to sell on-site

• Selling right type and priced homes on-site via marketing, salesmanship & more

• All the seller-finance alternatives, including lease-option and use of rental units

Presenters are successful, experienced land lease community owners; have taught this multifaceted topic before; and are passionate about sharing this valuable HOW TO information with YOU.

Cost? Quoted on an invitation by invitation basis, considering travel cost, and a minimum of $1,500 per diem rate for the teaching team. For more information, and or to schedule this one day educational opportunity for your members or employees, phone (317) 346-7156.

V.

New Edition of SWAN SONG Being Published

Yes, first 300 copies disappeared between early September and late December 2017!

The second edition contains the latest (29th) annual ALLEN REPORT, a new chapter on resident-owned communities, and at least one new appendix resource document (e.g. Retrospective of Chattel Capital Cycles in Manufactured Housing).

Another ‘first’ is the addition of six full page ads, on verso pages facing the beginning page of as many chapters. These full page ads are available for $1,000.00 apiece. If you desire to have your firm showcased in the only History of the Land Lease Community Real Estate Asset Class (1970 to present day) & Official Record of Manufactured Housing Shipments (1955 to present day)’, talk to me right away via (317) 346-7156.

Once you make your decision to advertise, and we agree on your ad placement within the text, you’ll need to prepare and send an electronic file to Spotlight-Strategies for pre-press preparation. Ads must be in place and paid for by 31 May 2018.

Second edition of SWAN SONG will be available for public sale at the RV/MH Hall of Fame on 6 August 2018 at the induction festivities that day. What a truly unique opportunity for your firm to live on in manufactured housing industry history!

It’s likely this edition will be archived in the Library of Congress, the RV/MH Hall of Fame library, and Building Institute library, as well as other locations.

Advertisers will receive two free copies of the new edition of SWAN SONG, and the opportunity to buy additional copies at half price. If more than 20 copies ordered, we must know in advance, as said order(s) will likely affect (increase) the print run number.

***

George Allen, CPM, MHM
COBA7, division of GFA Management, Inc., dba PMN Publishing
Box # 47024,
Indianapolis, IN. 46247
(317) 346-7156

Blog # 483; Copyright @ 23 April 2018; community-investor.com

Perspective. ‘Land lease communities previously manufactured home communities, & ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the sole national advocate, voice, official ombudsman, historian, research report & online communication media for all North American LLCommunities

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance, a.k.a. COBA7, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

COBA7 Motto: ‘U Support US & WE Serve U!’ Goal of its’ print & online media =
____________________________________________________________________

INTRODUCTION. Manufactured housing ‘housers’ (‘aficionados’) are on the cusp of solving this nation’s widely acknowledged affordable housing crisis. Bet you didn’t know that. Well, ‘read on’ to learn the ‘whys & wherefores’ of this timely and titillating opportunity! We hinted at this exciting state of national housing affairs in last week’s posting ‘Retrospect & Prospect’- which many of you responded to with notes of agreement, encouragement, and support. Now, here – following a short MH history lesson, is what YOU need to know and do to ensure the present new HUD-Code housing shipment rebound momentum continues throughout year 2018 and into the next year!

Rare Look Into ‘Why & How’ of MH Rebound

Manufactured housing’s NEW ERA Paradigm Shift, away from HUD-Code housing distribution via independent (street) MHRetailers, to a New Breed of MHRetailer & Lender, has redefined the industry & its’ land lease community real estate asset class!

Did you know?

New HUD-Code housing shipments have increased from the historic nadir of 49,789 units during year 2009, to 92,902 by year end 2017. (Believe no other published total!) That’s an increase of 86+ percent (i.e. .86). For example 49,789 X 1.8659 = 92,902.

Do you know WHAT facilitated this stunning improvement? Two innovations.

The debut of Community Series Homes, or CSH Models in 2009, per agreement between 100 HUD-Code home manufacturers & (then) manufactured home community owners/operators meeting together at the RV/MH Hall of Fame in Elkhart, Indiana.

Then, the increasing volume of new HUD-Code homes, including CSH models, shipped directly from factories into (now) land lease communities nationwide! Seriously. In year 2009, only 24 percent of new homes (or 12,000+/-) did so; however, by year end 2015, that percentage jumped to more than 40 percent of new homes shipped (or 28,000+). And it’s estimated, by year end 2017, that percentage rose, once again, to more than 50 percent, or 46,400+/- units.

And frankly, given present trend volume, the industry could eclipse 100,000 new housing shipments by year end 2018, and (“Gasp!”) 200,000 units by 2022! But first…

Do you know WHY this is happening?

Sure you do, we just told you. But now, a quick glance back to the turn of the century, when easy access to chattel capital, to finance new home loans within communities, disappeared for good reasons – and has yet to return. Consequences? There have been two…

Disappearance of an estimated 10,000+/- independent (street) MHRetailers, as their independent third party sources of chattel capital dried up, and some sales centers were acquired by HUD-Code manufacturers desperate to continue the flow of new homes into already saturated local housing markets.

Owners/operators of land lease communities ‘picked up the housing distribution slack’, by ordering new HUD-Code homes directly from factories, then selling and often seller-financing them on-site, even ‘renting’ them at times – in the face of increased state and federal regulation of mortgage lending.

Do you know WHAT has to now occur to sustain new home shipment rebound velocity?

Many of the 500+/- known land lease community portfolio firms already buy new HUD-Code homes, by the dozen and half dozen, from manufactured housing factories. They’ve got that drill figured out, even the home mortgage part – whether financing comes via factory-sponsored programs, independent third party chattel capital sources, local lenders, private investors, or from ‘within their properties cash flow’, i.e. given little to no realty debt service or mortgage in place..

Some community portfolio firms, however, are just learning and effecting this buy-sell-finance routine, as are thousands of smaller (i.e. 100+/- rental homesite) properties. But guess what? The majority of these latter day New Breed of MHRetailers & Lenders are just now learning the drill. How?

By attending specially designed one and two day educational programs, usually hosted by state manufactured housing associations, sometimes HUD-Code housing manufacturers.

For example. The Two Days of New Home Sales Seminars & Plant Tours scheduled for 8 & 9 May, at the RV/MH Hall of Fame in Elkhart, IN. Participation is limited to 200, so if interested, don’t hesitate to register. Phone (317) 247-6258 X 14, or visit www.imharvic.org/homesalesplanttours/

Do you know HOW factory-sponsored & community-focused sales training might differ?

Traditional new home distribution was, and still is, oft characterized by product choice recommendations by factory representatives (‘reps’); where emphasis is on ‘making the deal’, i.e. selling from ‘commission to commission’; and, maximizing the $ value of every transaction.

Community-focused distribution is (or should be) characterized by product choice and price points tailored to the local housing market (e.g. via Area Median Income or AMI), and, when a homebuyer/site lessee prospect is in hand, so to speak, their individual or household Annual Gross Income or AGI; and, carefully screening and qualifying them. Another significant difference, in community environs is, the penchant of some, if not many, owners/operators’ to narrow their profit margin between wholesale and retail value of the transaction to ‘make the deal’, sell the lifestyle, and cultivate an annuity-like income (i.e. site rent) for decades to come.

Do you know HOW to estimate new & resale, ‘affordable vs. risky’ housing price points per local housing markets defined by postal zip code, and individual/household AGI?

That’s the simplest HOW TO portion of this challenge to sustain manufactured housing shipment rebound volume!

Obtain a copy of this oddly named, but eminently practical, ‘Ah Ha! & Uh Oh! Worksheet’, for FREE, by phoning the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 & asking for it! The procedure is clearly described, and examples given for AMI & AGIs of $36,000 (typical MH owner AGI) & $51,229 (national average AMI).

Or, if you own a copy of the industry bestselling text, SWAN SONG, turn to Figure H, on pages # 45 & 46. First edition inventory has been depleted; second edition available on or about 1 May 2018. For pricing, and to order, simply phone the above-listed telephone number.

Here’s a description of the ” ‘Ah Ha! & Uh Oh! Formulae estimates maximum recommended ‘affordable & risky’ purchase prices for new & resale, privately -owned homes of any type, sited on realty owned fee simple with home, or on leased land in community”

Do you know WHAT the bottom line is to all that’s been penned here so far?

The HUD-Code manufactured housing industry is indeed, on a significant rebound! Here, we’ve shown you that, and what it’s taken to get to this point. But moving forward, more has to be done. Here’s a partial list of the desired (needed) influences along the way:

• More factories and state manufactured housing associations to train their land lease community members how to ‘buy, sell, & seller-finance’ new homes on-site!

• Ensure better and reasonable access to chattel capital, via manufacturer-sponsored programs, independent third party chattel lenders; local banks, private investors, and more. Know there’s a movement afoot to create a not for profit cooperative to serve as liaison between community owners/operators and lenders.

• Enlist marketing assistance from the Department of Housing & Urban Affairs (‘HUD’). After all; they regulate the industry and recognize HUD-Code housing as the most affordable of all housing types in the U.S. today! So, why not actively promote manufactured housing as well?

• Encourage the Federal Housing Finance Agency (‘FHFA’), GSEs Fannie Mae & Freddie Mac, to vigorously engage with their Duty to Serve (‘DTS’) pilot programs in behalf of the manufactured housing industry (i.e. housing finance) and communities nationwide! Meet these public servants on 6 September 2018, at the 27th annual International Networking Roundtable, in Indianapolis, IN.

Do YOU know HOW to become INVOLVED on the national level as an MH advocate?

• Become a direct, dues-paying member of one or both national advocates for manufactured housing, Manufactured Housing Institute (MHI welcomes all segments of the industry via 703/558-0400) & Manufactured Housing Association for Regulatory Reform (MHARR welcomes only HUD-Code housing manufacturers via 202/783-4087).

• Affiliate with the Community Owners (7 Part) Business Alliance. COBA7 is the ‘product & service’ supplier to the manufactured housing industry. It’s the source of this blog, the ‘Ah Ha! & Uh Oh! Worksheet’ offered for FREE, & copies of SWAN SONG, for starters. COBA7 is also one of the sponsors of the upcoming Two Days of Home Sales Seminars & Plant Tours, in Elkhart, IN. @ 8 & 9 May – via (317) 247-6258 X 14. Again, to reach COBA7, email gfa7156@aol.com

Now that you understand the ‘whys & wherefores’ of the manufactured housing shipment rebound 2009 – 2018, it behooves YOU to do your part to sustain that positive momentum thru year 2022 and beyond!

***

George Allen, CPM, MHM
COBA7, a division of GFA Management, Inc., dba PMN Publishing
Box # 47024
Indianapolis, IN. 46247
(317) 346-7156

Blog # 482; Copyright @ 16 April 2018; community-investor.com

Perspective. ‘Land lease communities, previously manufactured home communities, & ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the sole national advocate, voice, official ombudsman, historian, research report & online communication media for all North American LLCommunities.

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance,
a.k.a. COBA7, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

COBA7 Motto: ‘U Support US & WE Serve U!’ Goal of its’ print & online media =
to not only inform & opine, but to transform & improve MHBusiness performance!
_____________________________________________________________________

INTRODUCTION: OK, hold onto your hats – figuratively speaking. What you’re about to read has been said and penned before, time and again, but never with any traction. But now, in today’s Drain the (Inside the Washington Beltway) Swamp political environment, it’s time for HUD to Get on Board, not just as regulator (Some would say suppressor) of manufactured housing, but as it’s overt Champion, with the patent goal of aggressively solving this nation’s affordable housing crisis! Read on…

I.

Retrospect & Prospect*1

HUD’s Mission Statement Before, After, &…

Blogger’s Preview. While what you’re about to read, ostensibly (‘outwardly’) has to do with whether HUD’s mission statement ‘in transition’ will continue promoting “inclusive & discrimination-free communities” or not, there’s yet another timely, albeit unspoken, message to date, relative to manufactured housing – that should be penned into in any revised mission statement for the department! GFA

The April/May issue of Affordable Housing Finance magazine, page four, cites The Huffington Post as printing HUD is “…considering changing its’ mission statement.” And how “…Secretary Ben Carson was going to remove promises of inclusive and discrimination-free communities.” from it. Really?

Well, here’s how HUD’s mission statement reads today: “HUD’s mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD is working to strengthen the housing market to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; build inclusive and sustainable communities free from discrimination; and transform the way HUD does business.”

“According to HuffPost, a revamped proposed statement reads: “HUD’s mission is to ensure Americans have access to fair, affordable housing and opportunities to achieve self-sufficiency, thereby strengthening our communities and nation.” Hmm.

So there you have it,’ retrospect & prospect’, where HUD’s mission statement is concerned. But rather than here debate the merits and shortfalls of ‘inclusive and discrimination-free communities’ relative to said mission statement – from this veteran ‘houser’ observer’s perspective – some, if not much, attention by HUD, should be shifted to manufactured housing, the type factory-built housing the department has been regulating since 1976 (i.e. more than 40 years!)

But first a brief history lesson, couched in terms of new ‘mobile home’, and since 1976, ‘manufactured housing’ annual shipment volumes. The heyday of the industry occurred in 1973, when 579,940 new ‘mobile homes’ were shipped. However, upon implementation of the HUD-Code that year, annual shipment volume plunged to an annual average of 250,000+/- new homes during the next two decades, finally recovering during a brief renaissance in 1998, when 372,943 new homes were distributed. Then, for various apt reasons, the industry lost ‘easy access to chattel capital’ (i.e. needed to finance new home sales transactions within land lease communities). That’s when the slide cum plunge began, that only ended in 2009, when the industry’s nadir of 49,789+/- homes was reached.*2 Since then, given several in-industry business initiatives, shipment volume has slowly climbed to 92,902 by year end 2017.*3 And the ‘good news’ is the industry just might eclipse the 100,000 homes mark by year end 2018.

But know what? The manufactured housing industry could use some assistance from HUD = NOW!

Look at what follows here as “transform(ing) the way HUD does business.” per its’ present day mission statement.

How so? HUD well knows of the (Lack of) affordable housing crisis throughout the U.S. today. But ‘here’s the rub’. Almost without exception, they posture to deal with that CRSIS via one form or another of ‘government-assisted affordable housing’ solution (e.g. subsidized rental housing, Low Income Housing Tax Credits or LIHTC, and more). Little to no attention is made to ‘the other side of the housing coin’, he naturally-occurring affordable housing stock, whether it be single-family housing, conventional apartment communities, land lease communities (formerly manufactured home communities, and before that, ‘mobile home parks’), and more. NOW is the time for manufactured housing’s federal regulator (HUD) to begin actively marketing this type factory-built housing (i.e. per square foot cost @ 50 percent that of site-built housing) as the obvious answer to aforementioned national affordable housing CRISIS! Including the land lease community lifestyle, that goes hand-in-hand with the housing type!

Will this happen? Only if enough businessmen and women, along with their national advocacy and federal legislators unite in an effort to bring this about, the sooner the better. How to implement? Well, that’ll take more than one person to plan that route; so manufactured housing national advocacy entities, in this industry observer’s opinion, must unite and step forward, via a formal, volunteer task force, to agree on a Plan of action articulated in conjunction with supportive staff and effort from HUD!

I’ll be one of the first to step forward to volunteer to serve in this fashion. How ’bout you?

End Notes.

1. Title of a devotional page contained within The Valley of Vision, a collection of Puritan prayers & devotions, 1975.

2. Notice the +/- symbol after the 49,789+/- new home shipment total. Why? Because HUD’s contractor, the Institute for Business Technology & Safety (‘IBTS’) reports official monthly MH shipment totals to subscribers – who, with one exception, faithfully pass this information onto members and affiliates. This is one of those years when ‘more than one annual total’ is cited in trade literature. But with the distribution of SWAN SONG, by COBA7 during 2017, those aberrations have been kept to a minimum.

3. Community Series Home (design); seller-financing via ‘captive finance’, lease-option, cash deals, contract sales, local bank financing, even use of new HUD-Code homes as rental units circa late 1970s.

George Allen, CPM, MHM
COBA7, a division of GFA Management, Inc., dba PMN Publishing
Box # 47024,
Indianapolis, IN. 46247
(317) 346-7156

***

Blog # 481; Copyright @ 9 April 2018; community-investor.com

Perspective. ‘Land lease communities, previously manufactured home communities, & ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the sole national advocate, voice, official ombudsman, historian, research report & online communication media for all North American LLCommunities.

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance, a.k.a. COBA6\7, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

COBA7 Motto: ‘U Support US & WE Serve U!’ Goal of its’ print online media =
to not only inform & opine, but to transform & improve MHBusiness performance!
________________________________________________________________________

INTRODUCTION: Should I leave this ‘sleeping dog’ (i.e. industry & asset class consolidation) lie; or put it out into the open, encouraging dialogue and open discussion among colleagues? You tell me if this expose’ has been a good and timely idea or not.

***

Where will YOU be on 8 & 9 May 2018? Hopefully, if you’re buying and selling new HUD-Code homes on-site within land lease communities, you’ll be at the Two Days of New Home Sales & Plant Tours, hosted by the IMHA/RVIC (Indiana) at the RV/MH Hall of Fame in Elkhart, IN. I certainly plan to be present, to learn and meet with businessmen and women from throughout the Midwest. For more information, visit www.imharvic.org/homesalesplanttours/ & or phone (317) 247-6258X14. Only $195/person! Attendance is limited to 200! So, don’t delay registering.

***

FYI. Preliminary plans are being made for an MHAlive! (‘think tank’) session at the RV/MH Hall of Fame, Monday morning (9AM-Noon), 6 August. Topic? ‘Solving Our Nation’s (Lack of) Affordable Housing Crisis, with Factory-built Housing & Land Lease Communities!’ This will be followed, from 1-3PM, by a memoir writing seminar titled: ‘Preserving Your Personal & Corporate Legacy’. For more information about either or both minimal cost opportunities, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, or inquire via gfa7156@aol.com

And plan NOW, to stay for the RV/MH Hall of Fame Induction Banquet that same evening, 6 August! For more information, and or to register, phone (574)293-2344. If you’ve not attended in the past, know this: ‘Anyone who’s anybody in the manufactured housing & recreational vehicle industries will be present at this gala annual event!’

***

I.

Have Manufactured Housing & Land Lease Community Consolidation Become Too Big & Too Far To Be Fair?

A recent (4/2/2018) Opinion Today column in The New York Times posited that

“The United States has an oligopoly problem – a concentration of corporate power that’s been building for years, but only now starting to receive serious attention from policymakers, think tanks, and journalists.”

Their op/ed columnist David Leonhardt then quoted Barry Lynn & Philip Longman, writing in the Washington Monthly, in 2010:

“In nearly every sector of our economy far fewer firms control far greater shares of their markets than they did a generation (i.e. 30 years) ago.” Suggesting this “consolidation holds down wages, raises prices, and reduces job growth – while lifting corporate profits.”

So, do these observations apply to manufactured housing (a type of factory-built housing*1) fabricated in accords with a preemptive, performance-based national building code since 1974-76, and land lease communities*2?

In round numbers, the manufactured housing industry has consolidated down from 25 firms in 1977, to what is commonly referred to today as the ‘Big Three C’ firms: Clayton Homes, Inc., Cavco Industries, Inc., & Champion Home Builders, Inc – soon to maybe add the Skyline Corporation; and yet still, a dozen or so smaller, mostly regional firms.*3 & *4

In round numbers, roughly 15 percent of the estimated 50,000+/- land lease communities in the U.S. today (i.e. characterized as having 100+ rental homesites per property) have been consolidated into 500+/- property portfolio firms, up from only 25 such firms in 1987.*5 However, the 85 percent ‘smaller land lease communities’ (i.e. with fewer than 100 rental homesites per property), for the most part, remain in the hands of sole proprietors, partnerships, and a few portfolio ‘players’ who specialize in small property acquisition.

So, what have been the consequences of corporate and investment property consolidation during the past 30 or so years? Well, it’s a decidedly mixed bag…

HUD-Code home manufacturers, good and not so good:

• Good! Far greater production efficiencies, enhanced inventory buying power, easier absorption of regulatory measures, and ability to experiment, e.g. ‘net zero energy use’ housing design and fabrication, as well as other such advances.

• Inordinate influence (i.e. power) in trade advocacy matters at the national level, shutting out smaller corporate players; by holding meetings in expensive venues, limiting participation; allowing only selective proxy voting, etc..

• And as the ‘Big Three C’ firms collectively approach 80 percent national market share, housing product price becomes of increasing concern, particularly among land lease community owners buying new Community Series Homes*6 for sale on-site. While they hope consolidation economy of scale efficiencies work in their favor – all too often they do not, as fuel surcharges are added to invoices, and ‘floor fees’ are distributed according to manufacturer preference rather than homebuyer (community owner) desire, and more.

• Before chattel capital ‘took a hike’ from manufactured housing, shortly after the turn of the century – yet to return, a couple HUD-Code home manufacturers bought up many independent (street) MHRetailers, enabling continued shipment of new homes into local housing markets already saturated with product. Recall the consequences? According to a CFPB White Paper, 300,000 ‘repo’ homes and lost value of at least $1.3 billion.

Land lease communities, good and not so good:

• Good! After decades of minimal representation, property portfolio owners/operators, in 1993, took steps to ensure adequate national advocacy, as several in 1994, offered IPOs (Initial Public Offerings) of their stock, as they transitioned to real estate investment trusts (‘REITs’). Representation today, however, in this industry observer’s opinion, is intermittent at best, leadership less at worst. However, the asset class is well served with research, print & online media, networking & deal-making opportunities, and professional property management training & certification via the Manufactured Housing Manager (‘MHM’) program..

• Where some real estate investment trusts (‘REITs’) are concerned, too aggressive profit expectations early on (late 1990s), on the part of Wall Street analysts, led to sizeable and frequent rental homesite rate increases, ultimately changing the local housing market rent paradigm*7, and spawning contentious landlord-tenant legislation (Read ‘rent control’ initiatives)

• And today, there’s far less active lobbying participation in local and state legislative and regulatory matters, even interpersonal networking among businessmen and women, as entrepreneur property owners have been replaced by professional property managers working at the behest of centrally-located property management headquarters. Gone are the days of membership chapter meeting throughout most states.

• Market value distortion. In the words of one veteran land lease community owner: “…some portfolio buyers are paying such low cap rates upon property acquisition, they have no choice but to markedly increase the (site) rent to justify the exorbitant prices they are paying for the property. And yes, Mom & Pop-owned properties do often benefit from this buyout trend, with its’ low cap rates and high sale prices.” (Lightly edited. GFA)

For sure it’s been a mixed bag where consolidation consequences, pro and con, are concerned. And there’s certainly more, ‘good & not so good’, to the consolidation occurring in the manufactured housing production/distribution segment of the industry, as well as the real estate investment/management asset class. But all that’s just been penned, simply scratches the surface of this timely, telling topic.

If you’d like to add to this discussion, pro or con – and we hope you do, please send your remarks to

GFA c/o Box # 47024, Indianapolis, IN. 46247

gfa7156@aol.com

or via the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

Thanking You in advance for your input!

End Notes:

1. factory-built housing accounts for more than 95% of new U.S .single family housing today via on-site production builders, panelizers, manufactured housing, and modular housing.

2. a.k.a. manufactured housing, and before that ‘mobile home parks’.

3. SWAN SONG, George Allen, COBA7, Indianapolis, IN., 2017: figure B.

4. Signature Series Resource Document (‘SSRD’): ‘Major Factory-built Housing Manufactures….’ COBA7, 2016

5. SWAN SONG, Ibid, figure E.

6. Community Series Home, or CSH Model design concept birthed 2/28/2009 at a national meeting among HUD-Code home manufacturers and (then) manufactured home community owners, at the RV/MH Hall of Fame in Elkhart, IN. Concept name supplied later that year by landscape architect Don Westphal. CHS Model? Usually a singlesection, or modest-sized multisection home with at least one WOW! factor inside and out; shingled roof and house siding, plus durability-enhancing features to ease ‘make ready’ upon homeowner or renter turnover. An interesting sidebar here is that year 2009 saw record low number of new home shipments, at 49,789 units; and the FHFA & GSEs hosting a meeting in downtown Elkhart for the purpose of letting the manufactured housing industry know ‘henceforth’, it was on its’ own, when it came to accessing chattel capital.

7. Traditional 3:1 Rule for keeping land lease community site rent rates in sync with other forms of multifamily rental properties, in the same local housing market, has in some, if not many cases, been replaced with a self-serving 2:1 Rule. For example. Conventional apartment rent = $900/month? Then 3:1 rule suggests land lease community rents be pegged at $300/month. However, the 2:1 aberration pegs site rent, not at $300/month, but at $450/month.

***

Blog #480; Copyright @ 2 April 2018; community-investor.com

Perspective. ‘Land lease communities, previously manufactured home communities, & ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the sole national advocate, voice, official ombudsman, historian, research report & online communication media for all North American LLCommunities.

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance,
a.k.a. COBA7, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

COBA7 Motto: ‘U Support US & WE Serve U!’ Goal of its’ print & online media =
to not only inform & opine, but to transform & improve MHBusiness performance!
______________________________________________________________________

INTRODUCTION: Best Kept Secret; Exciting Stats & Continuing Trends; and, Be Careful Who You Read & What You Believe!

I.

Best Kept Secret in All of Manufactured Housing!

Everyone has heard, one way or another, about the Manufactured Housing Consensus Committee (‘MHCC’) – spawned by the Manufactured Housing Improvement Act of 2000, a.k.a. MHIA2000.

Well, did YOU know, as a manufactured housing ‘producer’ (Read, manufacturer), ‘user’ (Read, consumer interest), and or someone with ‘general interest &/or public official’ involvement with manufactured housing, you’re eligible to apply for an open seat on the MHCC? Didn’t think so. That’s why said opportunities continue to be the ‘Best Kept Secret in All of Manufactured Housing’!

And right now there are openings to be filled! By YOU?

If sincerely interested in ‘putting your hat into the ring’, so to speak, get hold of the Federal Register/Vol. 82, No. 54/Tuesday, March 20th, 2018/Notices; page 12200. MHCC members serve for ‘up to two terms of three years’, and ‘meetings take place by conference call or in person’.

Also contact the office of Teresa B. Payne, acting deputy administrator, office of manufactured housing programs at HUD, via (202) 708-6423, for more information.

One caution. In my opinion, this can be a very political minefield. I’ve applied in the past, but could never get past the manufacture housing industry politics that seem to prevail in Washington, DC. So, if you’ve got ‘friends in the business’, better positioned than mine, solicit their support as you quickly navigate the application process!

Deadline for submission of applications? 19 April 2018. So, this is a short fuse opportunity. FYI. A couple of our business peers who’ve served on the MHCC in years past are Susan Brenton in AZ, and Doug Gorman in OK.

II.

Have You Been Paying Close Attention?

There’s a plethora of not only encouraging statistics of late, but some ‘telling’ trending occurring on as well. And what are these leading indicators:

• Probably the most exciting, and announced in the feature article of the March issue of the Allen Letter professional journal are these two gems: 2018 new manufactured housing shipments are projected, based on trending to date, to reach 107,000 units by year end! And, continuing with said trending uptick in shipments, maybe 200,000 by year end 2022. Now, how bold & exciting is that?

• Then there’s the continued ‘proof’ of the ongoing paradigm shift, since the turn of the century – away from distribution by independent (street) MHRetailers to on-site home sales within land lease communities! This phenomena is referred to as the NEW ERA of manufactured housing & land lease communities. Specifically; seeing 24% of new HUD-Code homes going into LLCommunities during 2009, jump to more than 41% by year end 2015; and estimated to eclipse 75+/-% by year 2020. Now, how bold & exciting is that?

• And finally, for now anyway, there’s the ‘first time ever’ proof of affordable housing production dominance, by dint of HUD-Code manufactured housing shipments! How so? When polled, the ‘Big Three C’ manufactured housing producers (i.e. Clayton, CAVCO, Champion, together with a commanding 75+/-percent national market share) reported an average of at least 65 percent of their new home shipments during 2017 were (wholesale) valued at $50,000 or less! Now, how bold & exciting is that?

Did you get all that? By year end 2018 the manufactured housing industry might well have shipped more than 100,000 new HUD-Code homes; that by year end 2022, we might return to that ‘sweet spot’ of 200,000 new HUD-Code homes shipped; and during the same time frame, we see the volume of new HUD-Code homes going directly into land lease communities, increase from 24 percent to maybe 75 percent! But most important of all = WE ARE AFFORDABLE HOUSING!

III.

Ezine Distorts Manufactured Housing Trend

As much as some folk would have you believe, One REIT (Sun Communities), and a couple more (ELS & UMH – also REITs) do not a trend make!

Yes, according to a recently published Intelligence Report (3/29), a ‘third or more new manufactured housing shipments (i.e. 41 percent at year end 2015, & more now. GFA) are going into land lease communities.’

And yes, aforementioned property portfolios are buying in bulk, i.e. large numbers of new HUD-Code homes

But, the ezine misses an unfolding story, when it concentrates on what it views as the ‘three to five year window before (those three firms) MHCommunities fill their vacancies of existing home sites.’ – proposing that new HUD-Code housing shipment volume will go flat!

The ezine makes no mention of the 85 percent of estimated 50,000 land lease communities nationwide, characterized as having fewer than 100 rental homesites apiece, many of which are presently vacant.

That my friend, is where ‘the action’ should and will be going forward in manufactured housing and land lease community history! How so?

For the most part, the owners/operators of these estimated 43,000 smaller land lease communities don’t know how to fill their vacant rental homesites. Seriously. Most of them developed and or acquired these properties during the decades when independent (street) MHRetailers ‘were’ the distribution arm of the manufacturing process.

Most of that changed following the turn of the 21st century, when ‘easy access to chattel capital’ went away and has yet to return. Today, the new manufactured housing paradigm rests on the shoulders of entrepreneurial owners/operators of land lease communities. Individuals who are only now, for the most part, learning to

• Get their properties ‘ready’ to sell new homes on-site, e.g. curb appeal, foundations, advertising, etc.

• Spec & buy, with the right price point(s), new HUD-Code homes, directly from one or another manufacturer

• Effectively sell these new homes on-site and lease the rental homesites

• And when need be, seller-finance new home sales transactions via ‘captive finance’, manufacturer $ assistance, local banks, lease-option, contract sale, even leased as rental units.

Where are these businessmen and women going for assistance with this four step drill?

Some rely on freelance consultants (e.g. Ken Corbin), experienced peers (e.g. Spencer Roane, MHM re lease-option), factory training, and their state manufactured housing association.

One good example of the latter resource will occur 8 & 9 May at the RV/MH Hall of Fame in Elkhart, IN., when the IMHA/RVIC (Indiana association) hosts the second Two Days of New Home Seminars & Plant Tours. There, all four segments of the new home sales process will be taught by a half dozen capable, experienced, motivated land lease community owners/operators. Attendance is limited to 200. And other state MHAssociation executives are encouraged to attend and take this customized training session back to their membership.

A corollary to this training will be the ‘Six Right Ps of Marketing’, i.e. Product, Place, Price, Promotion, People, Process. If this too is new to you, be present to receive a plastic 3X5 wallet card, used as a Ready Reminder of how to market homes effectively!

For more information and or to register for this event, phone (317) 247-6258 x 14 and or visit www.inmharvic.org/homesalesplanttours/

OK, back to the theme of this part of this week’s blog posting.

YES, today the lion’s share of new HUD-Code homes being shipped ‘appear’ to be going mainly into the largest of the property portfolio firms’ land lease communities. And that’s expected to continue for awhile. However, the vast majority (i.e. 85%) of land lease communities across the U.S., are not in portfolios, and have an increasing number of vacant rental homesites – as the supply of ‘repos’ and resale homes dries up. That’s where and why new home shipment will have to head for years to come. And the sooner state manufactured housing associations, and HUD-Code housing factories, realize this – and start teaching owners/operators to effect this four step improved occupancy process, the better!

***

Blog # 479; Copyright @ 25 March 2018; community-investor.com

Perspective. ‘Land lease communities, previously manufactured home communities, & ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the sole national advocate, voice, official ombudsman, historian, research report & online communication media for all North American LLCommunities.

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance, a.k.a. COBA7, use Official MHIndustry HOTINE: (877) MFD-HSNG or 633-4764

COBA8 Motto: ‘U Support US & WE Serve U!’ Goal of its’ print & online media =
to not only inform & opine, but to transform & improve MHBusiness performance!
____________________________________________________________________

INTRODUCTION. 50 land lease community owners/operators joined Spencer Roane, MHM, and George Allen, CPM, MHM, during the lunch hour on 3/20 at the MHShow in Tunica, Mississippi. If you were present, you know what you ‘did not miss’ – and excellent Power Point presentation titled, ‘Chattel Financing You Can Take to Your Bank!’ Since this is a ‘work in progress’, present intent is to present much of this same material as the feature article in the May issue of the Allen Letter professional journal – just in time to serve as a handout at the second Two Days of Home Sales Seminars & Plant Tours, at the RV/M H Hall of Fame in Elkhart, IN., on 8 & 9 May 2018.

FYI: to receive the aforementioned newsletter use contact information contained in the heading of this blog posting. To learn more about, and register to attend, the Two Days program, phone (317) 246-6258 X 14 or visit www.imharvic.org/homesalesplanttours/

Now, the narrative following this INTRODUCTION, contains some ‘never before published statistics’ related to the shipment of new HUD-Code homes by the Big Three C manufacturing firms. Frankly, nothing I’ve penned during the past 35 years better describes how the manufactured housing industry provides the lions’ share of the most affordable housing available in the United States today – despite the negative connotation implied in the title. Read on…

I.
Shame On Us!
A Sincere Plea to Manufactured Housing Aficionados

At the very time we should be rallying together to ‘ship more new HUD-Code homes’, elements within the manufactured housing industry, attempt to drive us apart! Read what follows here, then reach out to those distracting elements, encourage them to ‘get on board’, with everyone else, working together to effectively address, maybe even solve, the national ‘Lack of) affordable housing crisis so rampant in the U.S. today!

Yes, there is an affordable housing (supply) crisis; as many – if not most, homebuyers/owners and renters today, spend 40 to 50 percent (& higher) of their Annual Gross Income (‘AGI’) on PITI (principal, interest, taxes & insurance) mortgage payments or rent, oft exceeding the widely agreed upon 30 percent Housing Expense Factor (‘HEF’) guideline – one of six measures of affordable housing.*1

Know what? While manufactured housing claims to be the most affordable form of factory-built housing (i.e. This includes on-site production builders using factory-fabricated components; exterior & interior wall panelizers; manufacture housing; & modular housing) on a cost per square foot basis,.*2 we take this bold claim one major step further,

‘Most new HUD-Code housing shipped today is demonstrably affordable!’ How so? Specifically, the majority of new HUD-Code manufactured homes shipped during years 2017, and 2018 to date, were/are affordable, with an average of 60 percent of all shipped homes being valued at or below $50,000 (wholesale) apiece!*3&4

Now, compare this ‘theory cum truism’ with the critical flim flam (‘humbug’ or sham) bandied about concerning the near debut of a new type or class of upscale manufactured home.*5 As you just read, we’re already well-serving the affordable housing market with $50,000 new HUD-Code homes – even as the industry continues to be denied reasonable access to chattel capital for the on-site financing o f new homes within land lease communities (a.k.a. manufactured home communities). So, why not design and fabricate HUD-Code manufactured homes appealing to underserved markets throughout the U.S.? Lest you think this is a novel phenomenon, recall the days of Developer Series Homes, a.k.a. MHSelect, during the late 1990s – and now, in the minds of GSEs (‘government-sponsored enterprises’ Fannie Mae & Freddie Mac) maybe MHAdvantage. Still others are saying Millennial Housing!

A few months ago, a mini-white paper was published, and widely distributed to ‘housers’ throughout the U.S. Titled, ‘Solving Our Nation’s (Lack of) Affordable Housing Crisis, with Factory-built Housing & Land Lease Communities’. Well this ‘Shame On Us’ op/ed piece is a follow-on to that first ‘affordable housing crisis solution’, an admonishment to peers in the manufactured housing industry to settle down and collectively focus on two important matters at hand: continue to build more affordable homes, and increase shipment volume! To this latter point, we’re on track, at 90,902 new HUD-Code homes shipped during year 2017, to eclipse the idyllic 200,000 mark by year 2022!*6 So, let’s not derail our progress to date – or again, ‘Shame On Us!’

End Notes.

1. Six commonly recognized measures of affordable housing include aforesaid Housing Expense Factor (‘HEF’); Housing Opportunity Index (‘HOI’); Housing Wage (‘HW’); Workforce Housing (‘WFH’); Income to Home Value Ration (‘IHVR’); & ‘One or anyone who believes they live in affordable housing.’ From Book of Formulae, Rules of Thumb & Helpful Measures, George Allen, PMN Publishing, 2012, p. 38

2. $57.21/square foot for manufactured homes; $108.10 for new site-built homes (not including underlying realty); & $87.76 for existing site-built homes, per US Census Bureau MH Survey & HUD’s Survey of Construction.

3. This compares favorably to the $43,126 per manufactured housing unit ‘production value’ estimated by Dr. Stephen C. Cooke, using 2013 year housing production (shipments) as a base year, while engaged in research in behalf of the Manufactured Housing Institute.

4. HUD-Code manufactured housing producers were polled during March 2018 YTD, as to the percentage of new homes shipped that were/are valued at $50,000 o r less, wholesale. Those HUD-Code home manufacturers collectively control an estimated 75-80 percent of national market share, of this type factory-built housing. Among these Big Three C manufacturers, they reported percentages of 60, 65, & 70 percent.

5. Multisection manufactured homes with 5/12 roof pitch & shingled; conventional house siding; energy efficiency enhanced; built-in porch, and possible presence of a garage.

6. Based on the lead story in the March 2018 issue of the Allen Letter professional journal.

Note.

Free copies of the mini-white paper ‘Solving Our Nation’s (Lack of) Affordable Housing Crisis, with Factory-built Housing & Land Lease Communities!’, as well as the March 2018 issue of the Allen Letter professional journal, are available ‘for the asking’, by phoning the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, or via COBA&: gfa7156@aol.com

***

Blog # 478; Copyright @ 11 March 2018; community-investor.com

Perspective. ‘Land lease communities, previously manufactured home communities, &
‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the sole national advocate, voice, official ombudsman, historian, research report & online communication media for all North American LLCommunities.

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance, a.k.a. COBA7, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

CBA7 Motto: ‘U Support US & WE Serve U!’ Goal of its’ print & online media =
to not only inform & opine, but to transform & improve MHBusiness performance!
_____________________________________________________________________

INTRODUCTION. So, where will YOU be during the lunch hour, 20 March, at the Tunica MHShow? Hopefully you’ll be convening with dozens of other land lease community owners/operators at the second ‘in search of chattel capital’ meeting. The first was held 17 January during the Louisville MHShow. Since then, much progress has been made, and Spencer Roane, MHM, and I, look forward to sharing this new knowledge with YOU! For more info, contact genevieve@roane.com GFA

In the meantime, here’s…

I.

Chattel Financing You Can Take to Your Bank!

We’ll be gauging the willingness of small to mid-size land lease community owners to reduce lender risk when underwriting personal property (chattel) loans on new manufactured homes sited on rental homesites within their properties. We know many owners/operators are motivated to do so, knowing and desiring significant financial incentives associated with filling vacant sites with new Community Series Homes (a.k.a. CSH models). These benefits include: 1) upgrading of curb appeal, 2) improvement to monthly cash flow, & 3) increased value of one’s realty investment! Furthermore, many sell new homes at minimal profit, to realize these benefits, and enjoy the likelihood of fewer defaults when homebuyers/site lessees are properly pre-qualified, and enjoying lower home loan interest rates.

Since many land lease community owners are already ‘guaranteeing’ their seller-financed loans, we suspect they’re not opposed to guaranteeing mortgages. We know many prefer mortgages, from third party lenders, over alternative forms of seller-financing, especially when dealing with such lenders avoids mortgage origination compliance issues.

Furthermore, we hope HUD-Code housing manufacturers join us in this endeavor, as ‘effecting more mortgages’ significantly increases the potential of selling and shipping more new Community Series Homes into land lease communities! After all, we still have an estimated 250,000 vacant rental homesites to fill throughout the nation.

The need for this strategic financial information is so great, and timely, we’ve formed a team to travel the U.S., teaching small to mid-size community owners/operators 1) home acquisition financing, 2) effective screening of homebuyers, 3) basic underwriting of loans, 4) how to reduce defaults, and 5) importance of establishing reserves to cover default-related costs. We’re looking to partner with HUD-Code housing manufacturers, and state manufactured housing associations, to bring this ‘first of its’ kind’ program to their members.

So, if you’re a new home manufacturer, or executive director of a state manufactured housing association, plan now to schedule this one day program for your members! Contact Spencer Roane, MHM, via genevieve@roane.com And it ‘goes without saying’, don’t wait for anyone else, national advocacy entity or otherwise, to offer YOU a similar educational opportunity. It simply is not going to happen. Why? Because only land lease community owners, actively and successfully engaged in seller-finance, know what YOU need to know to be successful!

II.

TWO DAYS OF NEW HOME SALES SEMINARS & PLANT TOURS

Did you attend – or miss the first Two Days of Plant Tours & Home Sales Seminars when held at the RV/MH Hall of Fame in Elkhart, IN., during the Spring of 2016? Well, the program is back!

Two Days of Home Sales Seminars & Plant Tours (Subtle title alteration signals change in priority between ‘then & now’) will occur 8 & 9 May, again at the RV/MH Hall of Fame in Elkhart, IN. This year’s event planned and sponsored cooperatively by COBA7 and the IMHA/RVIC (Indiana) association.

What’s will be covered? Building on the four steps to selling and financing new homes on-site within land lease communities…

• Getting One’s Property Ready for On-site Sale of New Manufactured Homes

• ‘Spec’ing’, Determining Affordable Price Point for, and Buying New Homes

• Effectively Selling New HUD-Code Homes On-site &/or Renting Them

• Seller-financing New Homes via contract, ‘captive finance’, lease-option, etc.

with particular emphasis on applying the ‘Six Right Ps of Marketing’ to the marketing and sale of new homes, as well as leasing of rental homesites!

Plan NOW to attend. Telephone (317) 247-6258 x 14 and request an event brochure, or online@imharvic.org/homesalesplanttours Attendance limited to 200, so don’t delay registering! Also visit www.imharvic.org/homesalesplanttours for info and or to register!

***

Blog # 477; Copyright @ 18 February 2018; community-investor.com

Perspective. ‘Land lease communities, previously manufactured home communities, & ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the sole national advocate, voice, official ombudsman, historian, research report & online communication media for all North American LLCommunities.

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance, a.k.a. COBA7, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

COBA7 Motto: ‘U Support US & WE Serve U!’ Goal of its’ print & online media =
to not only inform & opine, but to transform & improve MHBusiness performance!
_____________________________________________________________________

INTRODUCTION: Hey, a minor tweak to blog # 476. MHIndustry shipped 92,905 new HUD-Code homes during year 2007, NOT in 2018, as stated! Sorry ’bout that. If you own a copy of SWAN SONG, be sure to insert that 92,205 into the space left for it in Figure A in chapter # 1 of the ‘History of the Land Lease Community Real Estate Asset Class.

What’s to be found here in blog # 477? A Call for Immediate Action by everyone with ‘skin in the game’ of manufactured housing & land lease communities! And that’s YOU!

Then a view of the soft underbelly of FHFA & GSEs, where $ distribution is concerned. Confident you’re not aware of the deep state political $ carryover that apparently carries more weight than maxing out DTS to get manufactured housing healthy again.

I.

A ONCE IN A CAREER OPPORTUNITY FOR YOU!

Before 26 February, Identify for Review, Specific Troubling HUD Rules & Regulations Relative to Manufactured Housing & Land Lease Communities

That’s right, this is a very short fuse, potentially explosive opportunity, for manufactured housing aficionados and land lease community owners/operators, to directly input HUD concerning rules and regulations that have been hindering new housing fabrication and home placements for the past decade or more.

How to do this? Four immediate courses of action enable you to respond by 26 February:

• Go to www.regulations.gov When asked to identify the focus of your remarks, enter: Docket No. FR-6075-N-01 Regulatory Review of Manufactured Housing Rules. Then, in 5,000 words or less, type your list of troubling HUD rules & regulations relative to manufactured housing & land lease communities!

• Contact the Manufactured Housing Institute (‘MHI’) via (703)558-0400, and ask them allow you to sign onto their electronic communication to HUD on this important matter, or provide you a model letter to immediately emulate and mail!

• Contact the Manufactured Housing Association for Regulatory Reform (‘MHARR’) via (202) 783-4087, & ask them to provide a model letter, identifying salient issues for review & improvement, to emulate and mail to HUD!

• Contact the Community Owners (7 Part) Business Alliance (‘COBA7’) via gfa7156@aol.com, and request a copy of their letter being sent to HUD this week.

If you miss this ‘once in a career opportunity’ you only have yourself to blame!

II.

FOLLOW THE MONEY!

Yes, the Federal Housing Finance Agency (‘FHFA’) approved Government Sponsored Enterprises (‘GSE’) – read Fannie Mae & Freddie Mac – long-awaited but profoundly disappointing Duty to Serve (‘DTS’) pilot programs that will serve a mere 1.8 percent of manufactured housing purchases through to year 2020. Some say this will pencil out to between only $1.5 to 2 million dollars.

HOWEVER

According to a recent (18 February 2018) article in the Washington Examiner, “Fannie said it planned to make a $239 million payment to (affordable housing) trust funds this quarter, and Freddie said it would disburse $114 million.”

HUH?

Yes, you read that right. The two GSEs, combined, are donate $353 million (versus $1.5 – 2 million in manufactured housing mortgages) to affordable housing trust funds, groups that some – if not many – in the manufactured housing industry view as being housing supply competitors.

WHERE IS THE PARITY IN THIS?

Should we, as manufactured housing industry businessmen and women, once and for all, now see how little regard the GSEs really have for our type quality affordable housing, when it comes to their supporting of subsidy and entitlement programs?

WHAT DO YOU THINK?

III.

20th National Registry of ALL Lenders to be Distributed in Early March 2018!

Only the clamor for the annual (19th) ALLEN REPORT, a.k.a. ‘Who’s Who Among Land Lease Community Portfolio Owners/operators Throughout North America!’ exceeds enthusiasm for the annual (20th) National Registry of ALL Lenders!

Both Signature Series Resource Documents (‘SSRDs’) are researched and updated annually by the Community Owners (7 Part) Business Alliance. Both are distributed to Option II level COBA7 affiliates. To affiliate with COBA7, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

This time around, the 20th National Registry of ALL Lenders identifies and lists more than $5 billion in acquisition and refinance mortgages, for land lease communities, originated by no fewer than 25 lenders and loan brokers located throughout the U.S! And the names and contact information for more than 50 loan originators are listed for reference by would be borrowers.

And, of course, there’s a directory of independent, third party chattel capital lenders who specialize in mortgages for manufactured housing sited within land lease communities. Also contact information.

Lease-option is fast becoming the new home finance option of choice in many regions of the U.S. Information is included about that option as well.

And finally, as most blog floggers (readers) know, a movement has been afoot, since 17 January 2018, in Louisville, KY, to create a hybrid form of chattel capital tailored to the land lease community environment! A second meeting, of all interested parties, will occur during the lunch hour, 20 March 2018, at the Tunica MHShow in Mississippi. To be ensured an ‘invite’, email genevieve@roane.com Be a key part of land lease community history!

***

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