Uncategorized « George Allen / EducateMHC Blog

March 4, 2016

Official New HUD Home Shipment # for Jan & much more…

Filed under: Uncategorized — George Allen @ 7:45 am

Perspective. ‘Land-lease-lifestyle Communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the national advocacy voice, official ombudsman (press), research reporter, & online communication media for all LLLCommunities in North America!

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 transform & improve MHBusiness Model Performance!’

INTRODUCTION: Year 2016 = An opportunity for a fresh start within the MHIndustry. Let’s ALL report the same new HUD-Code home shipment # each month of this year!!!

Tired of being ignored by the greater housing market? Read Part II, & YOU will be for sure! The challenge today is, WE have no practical way to ‘Get Our Word Out’ to where it needs to go; to be seen, heard, believed, and acted upon by homebuyer/site lessees!

HEAR YE, HEAR YE!

The Institute for Building Technology & Safety (‘IBTS’); Department of Housing & Urban Development (‘HUD’); Manufactured Housing Association for Regulatory Reform (‘MHARR’); and Community Owners (7 Part) Business Alliance® (‘COBA7®’), agree & announce the HUD-Code manufactured housing industry shipped 5,862 new manufactured homes during the month of January 2016! That’s 893 more homes than were shipped during January 2015. So, we’re off to a Great Start!

WARNING! 5,862 new manufactured homes shipped during the month of January 2016 is the MHIndustry’s ‘sole official count’! There might be another ‘figure’ thrown out for consideration, but it’s not this authoritative one, carefully researched and published by aforementioned IBTS! So, don’t be fooled!

CHALLENGE! Let’s chart new HUD-Code home shipments during 2016, with everyone on the same statistical reporting page – by getting your data here, and from nowhere else. Proof? Just google ‘IBTS-manufactured housing’, to learn this is indeed ‘the source’ for this data we subscribe to, receive, and pass unadulterated onto you!

II.

Housing Industry All-Stars Keep Affordable Factory-built Housing on the Bench & Out of the View of Homebuyers!

The QUESTION: ‘How can HUD-Code manufactured housing be a meaningful part of, let alone the practical solution to, ‘scarce homeownership supply’ & the’ housing affordability crisis’ when it’s not even (ever) part of the public marketing conversation?

The ANSWER: It can’t, and won’t be, as long as quasi-academic papers like ‘Meet Me in the Middle: Supply Trends, Factors, & Product Considerations Impacting Homeownership Affordability Today.’ do not include us in the housing marketing mix! This paper by Todd LaRue, writing for the RCLCO Real Estate Advisory Services firm.

Here’s Summary of Findings; condensing data & information in this ten page report:

“Instead of targeting the meat of the market with a volume-driven strategy, high land costs, flat income growth, and a shrinking middle class are leading builders to target fewer but more affluent buyers. New for-sale homes are therefore getting bigger and more expensive, prices are rising faster than income, and household formation is outpacing single-family starts. In addition to limiting the affordability of new supply, conventional new detached homes may also be overlooking lifestyle preferences for more walkable, compact communities. As a result, key buyer segments are currently underserved. In pursuing more midscale, mid-priced product, builders may be able to offer more attainably priced housing – while leveraging the additional density to also improve their bottom line.”

As you can see (read), the researcher/author tiptoes all around HUD-Code manufactured housing and land-lease-lifestyle community characteristics of proven affordability, modest density, professional management, and more. Wonder if he’s even aware of our unique product & lifestyle advantages?

Here however, are some of the statistical tidbits found in this document:

• “In 2015, there were over one million new households (formed), and only 630,000 single-family housing starts (U.S. Commerce Dept says 728,000, but NAHB 549,000. Who to believe?), well below the long-term average (of what number?) – NAHB says 1,300,000 new homes per year.” This is what I dislike about business writer’s not footnoting statistics. Can pen anything they want!

• Measuring housing affordability as a multiple of Area Median Income (‘AMI’). “In San Francisco, expect to pay nine times the (area) median income for the median price resale home today.” (e.g. AMI = $77,485 in 2013 X 9 = $697,365). Indianapolis = 2.8 times X AMI, or $52,268 in 2014 X 2.8 = $146,182. To bring this ‘closer to (manufactured) home’, there’s a local housing market nearby where the AMI is $36,000. Using the ‘Ah Ha! & Uh Oh! Worksheet’*1, with variables of site rent @ $300/month, and ‘home only’ chattel loan terms @ 9.5% & 20 years, a prospective homebuyer/site lessee can get into a new HUD-Code home for $68,000 (including site rent), or 1.89X the AMI of $36,000. Yet, even with this much ‘affordability’ potential, manufactured housing continues to be ignored!

• Deterrents to Purchasing a Home, include: 63% @ COST (Hard to find homes in my price range); 39% @ SAVING for a down payment; 35% @ LOW SUPPLY of attractive homes sold fast and got multiple offers; 26% @ KNOWLEDGE – Did not know where to start; 21% ! FINANCING (low credit score or other debt); and, 20% @ PRODUCT (lack of home types wanted, regardless of price).*2 Whew! And here’s manufactured housing – more than able to compete in the deterrent areas of COST, KNOWLEDGE, & PRODUCT. ‘Hey, we’re over here!’

• Unmet (housing) demand. “The way current supply and demand forces are currently coming together, new housing supply tends toward small units in urban, midrise, or high-rise multifamily buildings, or large, exurban single-family detached homes. This leaves key buyer segments underserved, because this supply does not offer the value and or lifestyle sought by 1) young families & first-time buyers, 2) empty nesters, and 3) low & middle-income renters.” The last sentence so-describes manufactured housing’s traditional market of ‘Newly Weds & Nearly Deads!’, plus many low & middle-income renters.

• “’Missing middle’ housing (i.e. ‘midscale & mid-priced product types’) can be thought of as a value play and as a lifestyle choice.” Now read this carefully. “…these middle products …being between seven and 20 units per acre, which makes them somewhat smaller than the conventional detached home…are also relatively inexpensive to construct…The moderate density, unit sizes, and construction costs allow builders to sell these middle products at prices…more attainable to young families, first-time buyers, and middle-income buyers than new detached products.” With all that said (written), however, nary a word about ‘middle housing’ being ‘manufactured housing’. These folk are actually seeking ‘our answer’ as if we’re hiding in plain sight. ‘Hey, we’re over here!’

• And finally, “Why aren’t we building midscale, mid-priced product today?” Three reasons: Zoning & Regulation (NIMBYism via limited density & minimum lot & home sizes *3); Market & Land Value (High costs require greater density & projects too small to warrant financing); and, Consumer Preferences (Unaware of product alternatives)

So, where does all this leave us? In a word, ‘nowhere’ – until this sort of real estate advisory service, and others, ‘discover’ factory-built housing in general, HUD-Code manufactured housing in particular, even land-lease-lifestyle communities – and then write about us!

But how to accomplish ‘getting the word out’ to housing developers, land planners, real estate advisors, and prospective homebuyers/site lessees? Right now, that’s a difficult thing to do, as neither the mainstream secular or building trades business press demonstrates any interest in the quality, affordability, and energy efficiency our housing products bring to the shelter table! And add to that dismal reality, our industry has but one advertising-supported print trade publication left, and two limited circulation print business newsletters. And not much of an online presence either, despite promises and claims to the contrary. Neither national advocacy organization, at this point in time, uses the services of a public relations firm to position and publicize our unique housing product and community lifestyle. Until all those shortfalls are addressed, consider us ‘dead in the water’ marketing wise.

End Notes:

1. ‘Ah Ha! & Uh Oh! Worksheet’ is available ‘for the asking’ from COBA7®, via Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764; & email via gfa7156@aol.com. An amazing do-it-yourself tool for calculating new home price points in any local housing market defined by postal zip code (to ascertain AMI), and ‘How much new or resale home ($) a prospective homebuyer and or homebuyer/site lessee can truly afford to buy’, under ‘risky’ & ‘affordable’ housing payment conditions. This form belongs in every housing professional’s collection of resources and practical tools.

2. ‘According to Sample of 2014-2015 First-Time Buyers, February 2016’.

3. NIMBY = ‘Not in my back yard!’; oft shadowed by LULU as in ‘Locally Unwanted Land Use!’; and, tongue in cheek, BANANA = ‘Build Absolutely Nothing Anywhere Near Anybody!’

FINIS

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February 27, 2016

‘Who’s Working in Your Behalf – manufactured housing’?

Filed under: Uncategorized — George Allen @ 6:23 am

Perspective. ‘Land-lease-lifestyle Communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the national advocacy voice, official ombudsman (press), research reporter, & online communication media for all LLLCommunities in North America!

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 transform & improve MHBusiness Model Performance!’

INTRODUCTION. Did you know? As we go about our daily business in the MHIndustry, and as LLLCommunity owners/operators – and lenders, there’re businessmen and women taking steps intended, in time, to rejuvenate HUD-Code manufactured housing, and fill an estimated 250,000 vacant rental homesites in properties throughout the U.S.? Well there are, and this blog posting might be your first exposure to three independent initiatives occurring outside the confines of either, or both, national advocacy bodies in and near our nation’s capitol. What are YOU doing to advance these initiatives?

DID YOU KNOW?

We’re Reshaping the MHIndustry Business Model!

Who’re we talking about here?

Smart HUD-Code home manufacturers, savvy land-lease-lifestyle community owners/operators, even lenders!

How so?

Well, it’s been a three-step process spread over the past seven years, and the cycle likely won’t be complete for, well, another few years.

But we are getting a bit ahead of ourselves, so let’s stop, and describe the background, in effect lay the groundwork on which historic business model changes have occurred during the past few years, present day situation(s), and likely what’s to happen in the not too distant future.

1998 – 2000. For the second time (some say third*1) in its’ (then) 50 years history, the manufactured housing industry abused its’ easy access to chattel capital, to fund ‘home only’ loans in (then) manufactured home communities. Result?

By 2005, chattel capital from independent third party lenders had pretty much dried up. Annual shipments of new manufactured homes slid from 372,843 & 250,550 in years 1998 & 2000 respectively, to 129,902 by year 2005. Then it was observed, no fewer than six types of housing were now relatively commonplace in our unique, income-producing property type, so MHCommunity became land-lease-lifestyle community, or LLLCommunity for short. *2

2009 = nadir (bottom) year for HUD-Code manufactured housing, when only 49,789 new homes shipped! It was also at this point the number of independent (street) MHRetailers began to decline precipitously, from more than 14,000, to fewer than 4,000 (including ‘company stores’) a few years later! Who picked up the slack? Read on…

Enough background. This is where the three-step process leading to historic (manufactured housing) business model change began! On 28 February of that year, at the RV/MH Hall of Fame in Elkhart, IN., 100 HUD-Code home manufacturers and LLLCommunity owners/operators caucused to agree on a new home design that’d entice community owners to ‘buy more homes’, boosting shipment volume. Results? Community Series Home, or CSH Model design*3 was agreed upon, though not named as such until eight months later at the International Networking Roundtable.*4 Also that year, only 25% of new homes were going directly into LLLCommunities.

Fast forward to year 2015. By the end of this year, many plants routinely turned out CSH Models, often purchased by the 500+/- property portfolio firms who’d been consolidating the property type during the past 35 years.*5 By year end, it was estimated that 40% of all new HUD-Code homes were being shipped into (the larger) LLLCommunities. In summary, that meant the 12,500 homes shipped in 2009 more than doubled in number to 28,000+ homes during 2015! But it was also recognized, the vast majority of (smaller) LLLCommunities, awash with an estimated 250,000 vacant rental homesites nationwide, were NOT buying new homes, for several reasons: lack of ‘know how’; mostly passive, often absentee investors; and, lack of working capital and home finance, unless the mortgage was paid off.*6 Which brings us to the second step in the aforementioned three-step process leading to historic business model change.

HOW TO train and motivate small to mid-sized LLLCommunity owners/operators to buy more new HUD-Code homes and sell them on-site, even seller-financing them if need be? That’s where we are today, and in part, why THIS BLOG POSTING is a major step in this recovery scenario!

On 25 & 26 May 2016, at the RV/MH Heritage Foundation’s Hall of Fame, Museum & Library, in Elkhart, IN., the manufactured housing industry will host the ‘first ever’ Two Days of Plant Tours & Home Sales Seminars! No fewer than six plants are committed to offer a total of 24 tours during the two days (Champion Homes, 2 @ Clayton Homes, The Commodore Corporation, Cavco (Fairmont & Harmony), and Adventure Homes). The four seminars (Getting Ready!, Buying Homes! Selling Homes! Financing Homes!) will each be presented twice during the two day period. And all seminars will be taught by capable, experienced, successful, motivated LLLCommunity owners presently selling new HUD-Code homes on-site! Goal? To motivate small to mid-sized LLLCommunity owners/operators to attend, visit factories, and learn HOW TO prepare their properties, HOW TO buy new homes, HOW TO sell new homes on-site, and HOW TO finance them, when need be! We haven’t even printed brochures, but have more than 50 individuals registered to attend! How can you not want to be part of this exciting event? To put your name on the preferred invite list, simply email gfa7156@aol.com, or phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. There will also be opportunities to interface with firms offering chattel capital financing, as well as consultants providing training and resources on HOW TO be compliant with state and federal finance regulations.

The third-step in this historic business model changing sequence? Well, it’s ‘in process’, and has to do with the way we might finance new HUD-Code ‘home only’ loans within LLLCommunities ‘in the future’. Up front bottom line? We can continue to struggle along with limited access to chattel capital, increasing our annual shipment rate by only 4,000+/- new homes per year, e.g. 70,535 + 4,000 in 2016 = 74,535; then 78,535 in 2017. You get the picture; is this what you/we want? NO! So, to exceed that sluggish pace, we must do something major differently! And that might well have to be, again, in the area of ‘home only’ finance! Not going into detail here, other than to say, there are major U.S. banks who will jump at the opportunity to finance new HUD-Code homes if we, as an industry, would adjust our traditional business model to give them, the lenders, protections like they enjoy with real estate-secured mortgages. Is that possible? Some say YES, others say NO. And that’s where we are today, with this added whisper: Rumor has it, several major $ ‘players’ – sources and consultants, will likely meet during the next six months to work thru this situation, in search of a solution designed to help rejuvenate the MHIndustry. Who knows? Might even dust off the Freddie Mac program of 2006 that disappeared when the national economy went into national recession in year 2007….

In summary; the Community Series Home, in 2009, got the slow recovery ball rolling in the right direction. Now that portfolio firms are 40% buyers of new HUD-Code homes, it’s time to get the 85% of national (smaller) LLLCommunity owners/operators trained and motivated to do the same! Hence the ‘Two Days of Plant Tours & Home Sales Seminars’ @ 24 7 26 May 2016 in Elkhart, IN. No reason why such a unique and timely program can’t be emulated in Southeast, South Central, West coast, and Pacific Northwest regions of the U.S. Will YOU be the next event planner and promoter?

OR, to state it differently, more succinctly…

Years 2000 thru 2015 = 15 year paradigm shift for the manufactured housing industry of yore and today; culminating during 2014, with the co-debut of the Community Owners (7 Part) Business Alliance®, or COBA7®, and NEW ERA for the MHIndustry & LLLCommunity asset class, with latter dubbed ‘New Breed of MHRetailer & Lender’!

Are YOU on board? It’s not too late, you know…

End Notes.

1. For detailed treatment of this subject, read Otto Wontuck’s classic feature, ‘Looking Back at 50 Years of Manufactured Housing Financing’, in the now defunct Manufactured Factory Home Merchandiser magazine, June 2000, p.45.

2. LLLCommunities = pre-HUD ‘mobile homes’; post-HUD manufactured homes’ ‘park model RVs’, a.k.a. ‘PMRVs’; ‘RVs for a season’; and, stick-built homes constructed on-site in LLLCommunities, usually after hurricanes (only in FL).

3. Community Series Homes = WOW factors inside & out, plus a plethora of durability-enhancing features, to speed ‘make ready’ of units between renters or homebuyers/site lessees.

4. At the International Networking Roundtable in 2009, freelance landscape design consultant Don Westphal suggested labeling the new home design as Community Series Home.

5. In 1989 only 25 property portfolio firms; 500+/- known in 2016. See the 27th annual ALLEN REPORT, .a.k.a. ‘Who’s Who Among LLLCommunity Portfolio Owners/operators Throughout North America!’, available from COBA7® with Option II affiliation @ $544.95. Phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

6. This was 85% of the 55,000+/- known LLLCommunities nationwide, i.e. those with fewer than 100 rental homesites apiece.

FINIS

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

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February 19, 2016

Annual HUD-Code ‘Shipments’ Compared to Site-built Housing ‘Starts’ in 2009 & 2015!

Filed under: Uncategorized — George Allen @ 4:25 am

Perspective. ‘Land-lease-lifestyle Communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the national advocacy voice, official ombudsman (press), research reporter, & online communication media for all LLLCommunities in North America!

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 transform & improve MHBusiness Model Performance!’

INTRODUCTION.

Part I. As an industry, particularly as a type of factory-built housing, we oft talk and sometimes grouse, about our ‘competitor sister’, the site-built, stick, or traditional home builder. Well, here’s a rare statistical comparison of both housing types, side by side, ‘production wise’ during the Great Recession years 2009 – 2015! An interesting tale it is.

Part II. Haven’t yet read the ‘National Registry of ALL Lenders Serving the MHIndustry & LLLCommunity Asset Class’, yet wonder what it is like? Well, here’s the prelude to this annual seminal document, second in popularity only to the ALLEN REPORT. If you’re involved in MH and or LLLCommunity finance, this is a Must Have Resource!

Annual HUD-Code Home ‘Shipments’ & Site-built Housing ‘Starts’ Compared; 2009 & 2015!

Twice during the past 40 years, HUD-Code home ‘shipments’ competed handsomely with site-built housing ‘starts’: during 1973 when 579,960 new ‘mobile homes’ were distributed throughout the U.S., and in 1998, when 372,843 new ‘manufactured homes’ were shipped. Since then, HUD-Code manufactured housing, denied reasonable access to chattel capital (Initially, for good reasons) to originate ‘home only loans’ within land-lease-lifestyle communities (a.k.a. manufactured home communities), has been ‘on the ropes’, experiencing an historic nadir year in 2009, with only 49,789 new homes shipped. Today, we’re only up to 70,535 during year 2015. *1

So, how does this up – & – down factory-built housing scenario compare with the similar recent ‘boom – & – bust experience’ suffered by site-built housing throughout the U.S.?

Here are some interesting numbers to parse and compare:

• According to the National Association of Home Builders (‘NAHB’), the ideal number of annual new site-built housing ‘starts’ is 1,300,000. In 2009, their homebuilders ‘start’ volume plummeted to only 351,000 new homes, or just 27 percent of the stated ideal production level! Fast forward to year 2015. Last year, homebuilders’ new ‘starts’ numbered 549,000, or 42 percent of NAHB’s stated ideal production level, a tepid 15% recovery over a seven year period of time.

• Similarly, sources within the manufactured housing industry informally cite the ideal number of annual new HUD-Code housing ‘shipments’ to be 200,000+/-. In 2009, manufactured housing ‘shipment’ volume plummeted to only 49,789 new HUD-Code Homes, or 25 percent of the estimated ideal production level! Fast forward to year 2015. This past year, new home ‘shipments’ numbered 70,535 units, 35 percent of the estimated ideal production level, and a slow 10% recovery pace over a seven year period of time. *2

Assuming the accuracy of the ‘start’ & ‘shipment’ numbers just stated, it’s interesting to observe the nearly parallel performance of these two types of housing during the past seven years. Nadir (‘lowest point) production levels at only 27 & 25 percent of ‘ideal’ production levels respectively, now improved to 42 & 35 percent of said ‘ideals’.
In summary, site-built housing production is recovering only slightly faster than factory-built housing – likely because reasonable access to chattel capital continues to elude the manufactured housing industry sector.

So, what’s the Big Picture, or Macro View, of housing during the past seven years? The following is quoted from Integra Realty Resources’ VIEWPOINT, dated January 2016:

“The home building industry suffered a significant blow from the Great Recession, shutting off the housing creation supply pipeline for roughly three years. In 2015, the housing sector did not recover to pre-recession levels, and the long-term view for housing growth remains unclear. This major pillar of the U.S. economy continues adjusting to demographic, geographic, and generational shifts.” P.5

Frankly, this veteran MHIndustry observer does not see significant improvement to the new HUD-Code housing ‘shipment’ scene until several things occur:

• More LLLCommunity owners/operators buy more new HUD-Code ‘Community Series Homes’ for placement – and resale/seller-financing or lease-option, on the estimated 250,000 vacant rental homesites in properties throughout the U.S! At present, an estimated 40 percent of new HUD-Code home shipments go directly into LLLCommunities. How high might this percentage climb? 50, 60, 70%?

• MHIndustry leaders to do something they’ve resisted to date: caucus openly and nationally, to brainstorm practical, even new ways to foster increasingly attractive lending environments on-site within LLLCommunities! Yes, this might in time, mean moving away from traditional vehicular titling of manufactured homes, and adoption of long term written leases, to attract and protect lenders who favor originating and underwriting real estate – secured ‘home only’ loans.

• And as the previous two changes are effected, the MHIndustry to plan, fund, and launch its’ ‘first ever’ national factory-built housing brand advertising campaign! No point in doing this step until the first two are firmly in place; then, ‘pull out all the stops’ and introduce U.S. citizenry to ‘Affordable Housing that Appreciates in Value & Fulfills the American Dream of Home Ownership!’

There’s a lot said in the previous paragraphs; even more to be said once you’ve read them and reflected upon their content. If YOU agree, then copy and send this blog posting to your state and national MH advocacy organizations, encouraging them to ‘get on board’ this plan to rejuvenate our long suffering industry and realty asset class!

Disagree? Then write and let me know ‘why’; and, ‘what’ might work better1 Seriously. GFA

End Notes.

1. Statistics in this paragraph quoted from COBA7®s Signature Series Resource Document, or SSRD, titled: INDUSTRY BRIEFING SHEET; ‘The Decade (2005 – 2015) of Factory-built Housing & Land-lease-lifestyle Community’.

2. 70,535 new HUD-Code homes shipped during year 2015, is based on research conducted and reported, for a fee, by the Institute of Building Technology & Safety (‘IBTS’), and embraced unchanged by HUD, the MHARR, COBA7®, and VAMMHA.

II.

Prelude to 18th annual National Registry of ALL Lenders Serving the Manufactured Housing Industry & Land-lease-lifestyle Community Asset Class!

Last year’s ‘17th annual National Registry of ALL Lenders…’ began with this heady prediction, “2015 is the perfect time to be a borrower in the commercial/multifamily space because capital is plentiful, interest rates remain near historic lows, and real estate fundamentals are improving.” Well, as you’ll read in the paragraphs to follow, this has certainly been the case during the past 12 months; and guess what? Expect ‘even more of the same’ during year 2016!

Proof? This from NREI, January 2016: “Lenders on track to originate $224 billion in permanent loans on multifamily properties (alone) in 2015, according to the Mortgage Bankers Association. That’s a 15 percent increase from 2014, which in turn marked a 13 percent increase from 2013. And that year marked an 18 percent increase in originations from 2012.” P. 28

OK, so how ‘bout the land-lease-lifestyle community (a.k.a. manufactured home community) ‘acquisition & refinance’ segment of the multifamily market? Total 2015 dollar volume, among 26 reporting lenders and brokers, was $4,175,000,000.00. Yes, that’s four billion dollars plus! And this compares well with the $3,487,000,000.00 originated during all of 2014; in summary, a 20 percent increase in loan production!

All this is just part of an overall, bigger story. Beyond the multifamily property lending segment, lies the rest of the commercial realty market. Again, according to the MBA, expect originations of commercial and multifamily mortgages together to rise six percent in 2016, to $485 billion total!

So, why all this interest, on the part of investors and lenders, in multifamily and commercial in general, LLLCommunities in particular? According to Chris Finlay, chairman & CEO of Lloyd Jones Capital, “…smart people…have chosen real estate as their investment class, (knowing) real estate provides a stable diversification to the volatility of the equity markets, outperforming those markets for many, many years.” (1/13/2016 email). Want a peak at the future? Finlay goes on to say, “…consider the Millennials: 25 million classic apartment renters are still living at home. And it will be a while before they can afford – or want – to purchase a home (due to) student debt, flexibility to move for job opportunities, later marriages and children, etc.. (And get this!) Recently, the FHA has ruled potential home buyers who carry student debt will have to include said debt (even if deferred) in their debt-to- income calculations. So it will be even harder (for them) to qualify for a (home) mortgage. The 25 million will need rental housing.” That’s a lot of apartments; that’s also a lot of manufactured homes leased as rental units!

Well, is all rosy? Not at all. Label what follows here as ‘Certain Uncertainty!’ This paragraph quoted from Integra Realty Resources (‘IRR’) VIEWPOINT, ‘2016 Commercial Real Estate Trends Report’ publication:

“Though the U.S. is in its’ seventh year of the current economic cycle, uncertainty as to the recovery’s strength continues to persist. One view opines the U.S. is nearing an end of the current upward cycle, with a high probability of real estate price correction owing to asset appreciation that is ahead of real growth. An alternate view notes the U.S. economy may be on a long runway that will continue to accelerate. The various global and domestic economic forces are mixed, and as a result, the state of the economy feels edgy, volatile, chaotic, and oftentimes fragile.” P.4. Conflicted yet? You should be. Reread Part I of this week’s blog posting.

Now let’s turn to the specialty (real estate secured) finance markets, Commercial Mortgage Backed Securities, a.k.a. CMBS, and land-lease-lifestyle community lending.

Once again NREI provides insightful summary. “The CMBS market staged an impressive comeback in the aftermath of the recession. Having posted a paltry $2.7 billion in U.S. issuance in 2009, the market has realized a steady upward trajectory during the past six or so years. Lenders issued $94 billion in new loans in 2014, and expectations are 2015’s volume will top $10 billion.” With that said, CMBS lending is still nowhere near the 2006 & 2007 levels of issuance @ $198.4 billion & $228.6 billion respectively! What to expect in 2016? Again, Certain Uncertainty – in part driven by $111 billion in CMBS loan maturities in 2016, and $116.4 billion in 2017, but only $21.2 billion in 2018. The challenge? There’s simply not enough business to go around, e.g. 30+ lenders vying for about $100 billion in loans.

As we segue into the land-lease-lifestyle community realty lending environment, know the GSEs (government sponsored enterprises, Fannie Mae & Freddie Mac) have become, and will likely continue to be major players in this market. For example, in the February 2016 issue of MULTIFAMILY EXECUTIVE magazine, LLLCommunities receive ‘rare mention’:

“…experts anticipate more activity financing sizable workforce-housing properties in higher-cost markets, and also in niches such as small properties, assisted-living, and land-lease-lifestyle communities, and energy-and water-efficiency retrofits.” P.27

And at this point, in the ‘18th annual National Registry of ALL Lenders…’ we take a close look at the nearly two dozen lenders and loan brokers who routinely originate acquisition loans, and refinance mortgages, for LLLCommunities nationwide. If you’re not yet affiliated with COBA7®, but would like to be – to receive the 27th annual ALLEN REPORT (a.k.a. ‘Who’s Who Among LLLcommunity Portfolio Owners/operators Throughout North America!’), the 18th National Registry of ALL Lenders….’ And ten additional Signature Series Resource Documents, simply phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 or email: gfa7156@ao.com

FINIS

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February 12, 2016

70,535 New HUD-Code Homes Shipped in 2015!

Filed under: Uncategorized — George Allen @ 4:20 am

Perspective. ‘Land-lease-lifestyle Communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the national advocacy voice, official ombudsman 9press), research reporter, & online communication media for all LLLCommunities in North America!

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(R) Motto: ‘U Support US & WE Serve U!’& Goal of its’ print/online media = to ‘Not only inform & Opine, but transform & improve MHBusiness Model Performance’!

INTRODUCTION. Thank You for your patience! I needed ‘a week off’ from preparing this specialty blog; so, spent time driving from Indianapolis thru PA to Cape May, NJ, then onto Washington, DC, for MHI’s Winter meeting. More about that in a minute. First, here’s today’s blog preview:

• MHI’s estimation of annual new HUD-Code home shipments ‘unfortunately’ at odds with its’ data source IBTS, plus HUD, MHARR, COBA7®, & VAMMHA!

• Just how representative of the manufactured housing industry, are attendees at MHI’s Winter meeting? You might be surprised at who’s least represented.

• Timely and helpful information describing ‘What Millennials Value’, relative to housing now and in the near future.

IBTS, HUD, MHARR, COBA7® & VAMMHA Cite 70,535 New HUD-Code Homes Shipped During 2015!

The Institute of Building Technology & Safety (the actual source of MH shipment data), U.S. Department of HUD, the MHARR, COBA7®, & state association VAMMHA all agree: 70,535 new HUD-Code homes were shipped during year 2015.

However, the Manufactured Housing Institute, in its’ Monthly Economic Report, dated 10 February 2016, goes on record as stating ‘their total’ is only 70,519 homes, or 16 fewer homes than cited by the very source they subscribe to for this information! Why the unfortunate and misleading difference? Ask MHI; or, read the expose’ (‘MHIndustry Mystery Solved!’), in the July 2015 issue of the Allen Letter professional journal.

Have been waiting six months to pen this challenge to MHI leaders: “Why not turn over a new leaf, figuratively-speaking, during 2016, and start reporting monthly new HUD-Code home shipments in the same manner as your data source, IBTS, as well as HUD, MHARR, COBA7®, and VAMMHA?” GFA

To NOT do so, forces those who ‘keep score’ within the MHIndustry, to continue reporting how our two national advocacy bodies continue to be unable to play by the same rules; specifically, report the same number of new HUD-Code homes shipped each month! Does this ongoing difference reflect well on our business model? NO!

II.

MHI’s Winter Meeting in Washington, DC.

Have you ever been to a national meeting planned and hosted by the Manufactured Housing Institute? They generally occur three times annually, not counting their annual soirée, the Manufactured Housing Congress, always in Las Vegas, NV. This year it’ll be 3 – 5 May, 2016.

Well, the first thing you learn is, said meetings rarely attract more than 100 registrants. One meeting during year 2015 actually pulled in 120+/-. But this one, just concluded, in downtown Washington, DC. according to distributed registration list, attracted 100 businessmen and women. That’s roughly one third of MHI’s 302+/- Company Members, plus 48 state-appointed certified representatives, as of 12/18/2015

It’s also an interesting exercise, to figure out from which segment of the industry, and otherwise, these individuals hail. As far as we could tell, this is how MHI’s Winter meeting attendance ‘penciled out’:

State MHAssociations were the most heavily represented segment of the industry, with 19 execs present. Oh, and at the MHI meeting, while still adjusting to Ross Kinzler no longer being present (He retired at the first of this year, handing over responsibility of the Wisconsin Housing Alliance to Amy Bliss), we learned from Michigan sources, their executive director Tim DeWitt, will be retiring in July of this year.

Second highest representation comes from the land-lease-lifestyle community side of the house, or National Communities Council division. In this instance, 11 different firms were represented; comprised of eight property portfolio firms and three single property owner/operators. There were three representatives from UMH Properties alone.

Appeared there were a dozen representatives from various finance firms, e.g. independent third party chattel capital resources, commercial real estate mortgage originators, even a secondary market representative.

And finally, something that always strikes one as being strange, where this home manufacturing – dominated institute is concerned, is how there were only eight firms represented, with a few instances of multiple reps from the same company.

Of course, there was also the usual smattering of attorneys, government officials and regulators, as well as a few independent (street) MHRetailers.

III.

Millennials & Housing

“The CONSUMER REPORTS National Research Center surveyed 1,573 millennials nationwide, to better understand their attitudes toward housing. Overall, they believe firmly in ownership. Though just 26 percent currently own a home, 71 percent aspire to do so. Their top reasons include a desire for more privacy, the ability to make a space their own, and the wealth-building benefits of homeownership.”

“More than one-third of millennials who responded to our survey say the top reason for not owning a home is that they haven’t saved enough for a down payment. And it’s easy to see why. A 2015 report from the Joint Center for Housing Studies at Harvard University shows the financial pressure on those in the 25 – to – 34 age group who rent. Forty-one percent still owe, on average, $30,700 in college debt, and almost a quarter pay more than 50 percent of their income for housing.”

“So, what are millennials looking for in their next place to live? According to our survey, proximity to family and friends topped the list of features, though short commutes and walkability also popped up.”

The previous paragraphs quoted from the March 2016 issue of CONSUMER REPORTS.

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January 29, 2016

Plant Tours, Homes Sales Seminars, & MHConundrum

Filed under: Uncategorized — George Allen @ 7:16 am

Perspective. ‘Land-lease-lifestyle Communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the national advocacy voice, official ombudsman (press), research reporter, & online communication media for all LLLCommunities in North America!

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 transform & improve MHBusiness Model Performance.’

INTRODUCTION. This week began with ‘no idea’ what we’d cover in this week’s blog posting. It ends, however, with timely and helpful information about the upcoming ‘Two Days of Plant Tours & Home Sales Seminars’; the 25th anniversary International Networking Roundtable; what will likely become one of the very best LLLCommunity educational sessions during all of 2016; and a ‘heads up’ about next weeks blog posting – or not. And don’t miss the Postscript…in light of salacious reporting elsewhere earlier this week. GFA

Two Days of Plant Tours & Home Sales Seminars

(an update)

Carolyn and I’ve just returned from a two day trip to northern Indiana, visiting facilities where this inaugural event might be held later this Spring. Now we’re working with a half dozen HUD-Code home manufacturing firms to agree on a two day block of time during which to facilitate this unique ‘hands on’ & ‘how to’ opportunity to familiarize LLLCommunity owners/operators, with PRODUCT (new HUD-Code homes) & PROCESS (selling & seller-financing of same), with the ultimate goal of filling vacant rental homesites with homeowner/site lessees.

This much is certain so far. During the two day program, registrants – likely to be LLLCommunity owners/operators from throughout the Midwest, will be encouraged to pre-register four blocks of time (morning, & afternoon sessions, on two consecutive days = four sessions) for their preferred combination of plant tour(s) and home sales-related seminars. For example: one tour & three hours of seminars or one seminar and three tours; two hours of each; or; even four tours & no seminars or four seminars & no tours.

Plant tours? The following companies are scheduled, at this point, to host two hour tours, mornings and afternoons, during the two day program. They are, in alphabetical order, Adventure Homes (in Garrett), Cavco Industries’ Fairmont & Harmony Homes ( in Nappanee), Champion Home Builders (in Topeka), Clayton Homes (in Middlebury), Clayton Homes (in Wakarusa), Commodore Corporation (in Goshen), and possibly, Hi-Tech Housing (in Bristol). A special handout is being prepared to help registrants decide which plant(s) to tour. It’ll be a one page list of all these firms, along with characteristics of the new HUD-Code homes they manufacture and ship from the plants. This valuable handout will be available only to event registrants!

Home sales-related seminars? There will be four primary blocks of instruction, each repeated once again, during the two day program. The four key topics are:

• Getting Ready! Tips on readying one’s LLLCommunity to sell homes on-site.

• Buying Homes! How to select the right home & price point of new homes ordered

• Marketing & Selling! How to sell that new home once it’s on-site and installed

• Seller-financing! Overview of the $ alternatives, including leasing & lease-option

Specifically, ‘Getting Ready!’ will be presented during the morning of the first day, then repeated during the afternoon of the second day. That way, someone desiring to visit a plant the morning of the first day, can return to the host meeting facility and begin taking the next classes in sequence, e.g. ‘Buying Homes!’ the afternoon of the first day; ‘Marketing & Selling!’ the morning of the second day; and, ‘Seller-financing!’ – or – ‘Getting Ready!’ the afternoon of the second day. NOTE. To get max value from this two day session, it’s advisable to have two individuals attend from the same firm, if desiring to visit one or more plants, AND benefitting from the specialized knowledge shared during all four primary blocks of instruction.

By the way, and this is important: It’s anticipated all instructors teaching the four primary blocks of instruction, will be capable, experienced, successful, motivated owners of land-lease-lifestyle communities who’re actively selling and seller-financing new and resale homes on one or more of their properties!

Furthermore; one of the details not resolved yet, is how to provide opportunities to learn about ‘compliance with state & federal finance regulations’, while at this two day event; as well as ‘become familiar with chattel capital home loan programs’ available from independent, third party chattel capital finance firms. Since the daily programs extend from 8 AM to Noon; and 1 – 5PM (For plant tours, that schedule allows an hour’s drive each way, with two hours at selected plant, morning & or afternoon); with primary seminars (following a 45 minute Welcome & Introduction session), at 9-10:15 & 10:30-Noon; and, 2-3:15 & 3:30-5 each day. It’s anticipated, consultants and vendors with valuable services and products will be available by appointment, or on a catch-as-catch can basis, throughout the two day program. If you’re a consultant or vendor interested in this venue, let me know via (317) 346-7156.

So, what do you think so far? Interested in participating? We sure hope so. While specific dates and location will soon be determined, don’t hesitate to reach out and let us know of our interest and preferences. We already have 50+/- interested parties on a preliminary sign-up list. Add your name via gfa7156@aol.com or phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. No commitment; just knowledge you’ll be among the first to receive details.

II.

25th Anniversary, International Networking Roundtable

(an update)

Now this is a little further out; 7-9 September 2016. But given the special nature of this year’s annual event (It’s the 25th anniversary of the International Networking Roundtable!) and the way exciting themes are emerging, YOU – if an owner/operator of one or more land-lease-lifestyle communities, do NOT want to miss it! Here’re the plans so far….

Themes? Usually it’s a challenge to come up with one good one. This year we’re deciding among at least four:

• Manufactured Housing’s Conundrum! Whether to continue the new home shipment malaise of the past seven years, or make dramatic business model changes in at least four core aspects of manufactured housing. (See blog # 383)

• Preserve your legacy as a LLLCommunity Owner! Emulate the late Kris Jensen, Sr. as in his ‘A Danish American’, or the late John Crean (Fleetwood) in ‘The Wheel & I’. Then there’s the iconic Jim Clayton in ‘First a Dream’, along with Harrell & Darrell Cohron in ‘The Trailer Twins’, plus the pictorial autobiography of the late B.M. Vukovich (CREICO cum Acentia Real Estate), and now, Al Schrader of A.L.S. Properties, have all authored autobiographies. If we’re fortunate, at least one, two, even three of those pioneers might be with us this year! And I’ll share a brief ‘HOW TO write your life story’ basics with attendees.

• Four ‘Home Sales Seminars’ as presented at aforementioned (in this particular blog posting) ‘Two Days of Plant Tours & Home Sales Seminars’ in the Midwest

• ‘Bring Your Banker’! This movement to ID & court local bankers originating ‘home only’ chattel loans in LLLCommunities, began at last year’s Roundtable. A clear indication how LLLCommunities, the ‘New Breed of MHRetailer & Lender’ has taken the lead during this NEW ERA of Manufactured Housing!

And the 20 topics we’ll cover this year? I’ve already got a dozen or so of them covered. What do YOU want to hear and see? Just like with Part I of this blog posting, let me know via email: gfa7156@aol.com or the Official MHIndustry HOTLINE.

III.

The Best of Spencer Roane, MHM® & Team!

OK, I fumbled access to Spencer Roane’s Power Point Presentation re ‘Marketing New Homes to Hispanics!’ last week. You really do need to avail yourself of some, if not much, of what he shared with a 175 person audience in Louisville, KY., a few weeks ago.

Go to: http://leaseoptionmhsales.com/information Once there, scroll down to ‘Power Point Presentations-Lease-Option Transactions’, then click to open that menu, and scroll down to the Louisville presentation.

IV.

There Might Not Be a Blog Posting @ 7 February. Why?

Because I’ll likely be on what family refers to as my annual pilgrimage, to PA, NJ, DE, & MD. Since I’ll be driving all that way – to finally attend MHI’s Winter meeting in Washington, DC., there isn’t much time for blogging and sending BEBAs (Blast Email Blog Alerts) – but I might just surprise you.

***

A postscript of sorts…

Sure, I criticize MHI and MHARR from time to time, because I believe the manufactured housing industry, and by extension, the land-lease-lifestyle community asset class, deserves the very best job performance possible from salaried and elected leaders of our two national advocacy entities!

In more than three decades of op/ed writing, for one or another of past and present MH trade publications, and or within the pages of the Allen Letter professional journal, the Allen CONFIDENTIAL! and this blog at community-investor.com, I’ve yet to call out any one person or persons, by name, for dereliction of duty or any other reason – and I don’t plan to start now. Nor should others…

At this critical stage in our industry’s cycle prone history, we need to be working more together than apart. That’s why COBA7® reaches out to MHI & MHARR, in the hope we can work better together to manufacture, ship, sell, and seller-finance more new HUD-Code homes in 2017 than during 2016, and fewer than we’ll experience during 2018. Does anyone else out there agree, or are we going to continue to witness more self-defeating infighting?

***

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January 23, 2016

Manufactured Housings (Industry) Conundrum

Filed under: Uncategorized — George Allen @ 8:20 am

Perspective. ‘Land-lease-lifestyle Communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the national advocacy voice, official ombudsman (press), research reporter, & online communication media for all LLLCommunities in North America!

To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance®, a.k.a. COBA7®, use Official MHIndustry HOTLINE: (877) MFD-HSNG o r633-4764

COBA7® Motto: ‘U Support US & WE Serve U!’, & Goal of its’ print/online media = to ‘Not only inform & opine, but transform & improve MHBusiness Model Performance.’

INTRODUCTION. This is the promised Part II, referenced in last week’s blog posting. Specifically; the Summary of ‘significant business model changes likely needed to spark the resurgence of manufactured housing production, shipments, sales, and installations thereof!’ The complete report, spawning the following 16 ‘hard choices & drastic actions’ will be published at least twice during the coming months. Details to follow.

I..

Manufactured Housing’s Conundrum (riddle, hard question):

Whether to continue the ‘new HUD-Code home shipment malaise’ of the past seven years; OR, implement dramatic business model changes in four core aspects of manufactured housing?

What follows here is a Summary of ‘hard choices & drastic actions’ put forth in a study and commentary examining four major core aspects of manufactured housing:

• HUD-Code Manufactured Housing Production, Shipments & Sales

• Land-lease-lifestyle Community Operations

• Affordable Housing Crisis

• Hybrid Approach to Manufactured Housing Finance in LLLCommunities

This Summary is intended to whet your appetite to read and learn, from the body of the complete study, ‘how & why’ these ‘hard choices & drastic actions’ are a means to reinvigorate, if not SAVE, the manufactured housing industry from self-destruction via benign neglect, by year 2020!

The complete report, titled ‘Manufactured Housing’s Conundrum (‘riddle, hard question’)’ will debut as an enclosure to the February 2016 issue of the Allen CONFIDENTIAL! business newsletter; then, either as a feature article or reprint in a later issue of the Allen Letter professional journal. In any event, the report is a Must Read Document, for senior management and entrepreneur businessmen and women.

What’s interesting about the timing of the release of this Summary, and totality of said report, is it occurs during the same months as 1) distribution of the 27th annual ALLEN REPORT, a.k.a. ‘Who’s Who Among LLLCommunity Portfolio Owners/operators Throughout North America!’; and in February, the month when 2) the Signature Series Resource Document, or SSRD, titled: ‘State of the MHIndustry & LLLCommunity Asset Class!’ debuts as a lagniappe in the aforementioned Allen Letter; and March, 3) = 18th annual National Registry of ALL Lenders Serving the MHIndustry & LLLCommunity Asset Class. Are YOU on the receiving end of all this ‘strategic & timely reading’? If not, become an Option II affiliate of the Community Owners (7 Part) Business Alliance®, or COBA7® by phoning the Official MHIndustry HOTLINE: (877)MFD-HSNG or 633-4764.

NOTE. None of the material mentioned so far in this blog, SSRDs and otherwise, is available from any other national advocacy entity claiming to represent manufactured housing or LLLCommunities nationwide! So, don’t miss this unique opportunity to be ‘in the know’ as our industry/asset class ponders and decides its’ future for the next four years!

OK, now back to the Summary of ‘Manufactured Housings Conundrum (‘riddle, hard question’). Remember, this is only ‘a summary’, the bulk of supporting statistics and commentary is contained in the report body to be published in TAC! and the Allen Letter.

HUD-Code Manufactured Housing Production, Shipments & Sales

• Embrace Community Series Homes, as ‘home of today & the future’; and land-lease lifestyle communities as the 21st Century ‘emerging market’ for HUD-Code manufactured housing! (Already from 12,000+/- in 2009 to 28,000+/- in 2015!

• Exercise housing sale price compression without sacrificing quality, energy efficiency & product reputation! Now is not time to be maximize profitability, lest it hasten the demise of the manufactured housing industry by year 2020.

• If possible, adopt and offer a housing finance package to help sell new HUD-Code homes into LLLCommunities; but don’t go overboard, making one’s homes ‘loss leaders’ to corral favorable mortgage returns during the year(s) ahead!

• Direct one’s ‘floor fees’ to state & national trade bodies most supportive of HUD-Code home sales via effective lobbying, regulatory relief, & image promotion!

Land-lease-lifestyle Community Operations

• Ensure rental homesite rates are in sync with other forms of multifamily rental housing in the same local housing market; in effect, protecting the home value proposition of one’s homebuyers/site lessees!

• Encourage ‘85% of LLLCommunities’ to start selling & seller-financing new HUD-Code homes on-site! This may prove to be the most difficult task of all.

• Embrace professional property management at all levels of LLLCommunity operations, per ACM®s, MHM®s, & CPM®s. Firms to become AMO®s!*1

• Portfolio owners/operators to actively support state MHAssociations with dues memberships for all LLLCommunities, encouraging participation by managers!

Affordable Housing Crisis

• Agree on & start using a practical, workable definition of ‘affordable housing’; begin measuring effectiveness of programs, e.g. via Housing Expense Factor *2

• Encourage broader use of the ‘Ah Ha! & Uh Oh! Worksheet’ to calculate housing price points for new markets; how much house a prospective buyer should buy; and most important, change the lending landscape from ‘risky’ to ‘affordable’!

• Implement pre-sale qualification policies and procedures, as well as financial counseling!

Hybrid Approach to Manufactured Housing Finance in LLLCommunities

• Learn more, and consider effecting, conventional residential ‘home only’ mortgage loans in high quality, professionally managed LLLCommunities!

• Learn more about workings and opportunities via FHFA, GSEs, & DTS! *3

• Via your national advocate entity of choice (MHI, MHARR, COBA7®), support implementation of conventional residential ‘home only’ mortgage loans in high quality, professionally managed LLLCommunities featuring long term leases!

Well, there you have it. No fewer than 16 ‘hard choices & drastic actions’ to read, study, and decide whether the potential for increased HUD-Code home production, shipments & sales, is worth the risk of changing some, if not many, of the business models prevalent throughout the manufactured housing industry and land-lease-lifestyle community asset class today.

What say YOU? Inquiring COBA7® blog floggers (readers) would like to know! Please respond via gfa7156@aol.com or via the aforementioned Official MHIndustry HOTLINE.

End Notes:

1. ACM® via MHEI of MHI; MHM® via COBA7®, CPM® via IREM; and AMO® via IREM. All four certification designations should be commonplace throughout the land-lease-lifestyle community real estate asset class but are not!

2. Housing Expense Factor, or HEF, is one of six commonly known measures of ‘housing affordability’; the other ones being Housing Opportunity Index or HOI Measure; Housing Wage or HW Measure, Workforce Housing or WFH Measure; Income to Home Value Ratio or IHVR, a.k.a. ‘Realtor’s Rule of Thumb’; and ‘One Who Believes’…ownership housing is affordable if the price is right! Quoted from Book of Formulae, Rules of Thumb, & Helpful Measures, George Allen, CPM®Emeritus & MHM®Master, PMN Publishing, IN, 2012. Available for purchase from COBA7® via (317) 346-7156.

3. FHFA = Federal Housing Finance Agency; GSEs = Fannie Mae & Freddie Mac; DTS = Duty to Serve legislation.

***

A postscript of sorts. When I distributed an early DRAFT version of this blog posting for peer review, I was pleased with the universal approval for every one of the 16 ‘hard choices & drastic actions’ identified. But I was surprised by ‘more than one suggestion’ I should include a fifth core aspect of manufactured housing.

Care to guess whish one?

In four words: National Manufactured Housing Advocacy.

As you know by now, I did not ‘go down that slippery slope’ in this blog posting. Why?

If you’re a longtime reader of publications, in which I’ve penned op/ed pieces over the decades, you’re aware of knee jerk reactions (i.e. ‘kicks’) inevitably following every critique or ‘suggestion for improvement’ made, regarding either or both present day national advocacy bodies. They simply don’t like it when I point out how 1) they’re ‘housing manufacturer dominated’; and in one case, 2) by executives from a couple of the ‘largest property portfolios’. Nor is it appreciated, I’m told, 3) the term ‘affluence gerrymandering’ was coined to describe their penchant for holding national meetings at expensive resort venues, discouraging participation by direct, dues-paying members, making it easier to effect internal decision making. Oh, and 4) not to forget mention of selective prohibition of proxy voting in at least one institute division. And the list goes on; i.e.. imitation of other national entity programs (e.g. MHM® training & certification in 1988) and resource documents (e.g. annual ALLEN REPORT in 2015).

No, at least for the time being, I’ll – as Dan Rolfes, PHC®, and former MHI chairman, was known to say at times, ‘Keep my powder dry for another day’!

***

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January 15, 2016

‘Six Right Ps of Marketing’ & quiet before the storm…

Filed under: Uncategorized — George Allen @ 4:47 am

Perspective. ‘Land-lease-lifestyle Communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the national advocacy voice, official ombudsman (press), research reporter, & online communication media for all LLLCommunities in North America!

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 transform & improve MHBusiness Model Performance.’

INTRODUCTION. Not much to say really. Part I describes the newest, and possibly the most helpful marketing tool, for selling more HUD-Code manufactured homes on-site in LLLCommunities. And Part II, while not meant to be a tease, comes across that way, as I start – then – stop introducing, potentially the most controversial line of thinking and action I’ve penned in nearly four decades in this business and realty asset class. Didn’t get ‘cold feet’, just need more time to work through the significant business model changes likely needed to spark the resurgence of manufactured housing production, shipments, sales and installations thereof..

.
I.

The ‘Six Right Ps of Marketing’!

For once, HUD-Code manufactured housing & its’ land-lease-lifestyle Community component, thanks to the Community Owners (7 Part) Business Alliance, is figuratively speaking, ‘a significant leg up’, when it comes to articulating and offering a practical, comprehensive new housing sales & leasing marketing tool! Simply put, COBA7® introduces here, the ‘Six Right Ps of Marketing’; & here’s how we got to where we are today:…

ACADEMIC MARKETERS, in textbooks and classrooms on university campuses, extol the value and use of what they refer to as the Four Ps of Marketing; specifically: Product (or Service), Place, Price, & Promotion! No more, no less. And probably, in some industries, that’s as far as one needs to go, to ‘get the word out’ about one’s marketable product or service. But it’s nary enough for marketing practitioners working in the housing world, selling and leasing various types of shelter.

SUCCESSFUL MARKETERS of new and resale housing, as well as leasing apartments, and housing/rental homesites in LLLCommunity environs, have long known, Four Ps of Marketing are simply not enough to ‘get the job done’! No, even with the most attractive (housing) Product in the best Place, at a locally competitive Price, and well-Promoted, without properly trained, motivated, & supervised People, the job simply will not be well accomplished. Hence, the Five Ps of Marketing. But even that’s not enough to effectively market the wide variety of housing types, including manufactured housing and rental homesites available today. Each of those aforementioned Five Ps must be RIGHT, as in the Right Product (or Service) for the targeted market (customer), displayed and available in the Right Place in the local housing market, certainly at the Right Price (does ‘affordable’ sound familiar?), with the Right (mix of) Promotional efforts, by the Right (Again; trained, motivated & supervised) People! When those Five Right Ps truly track, we’re more than half way to Marketing & Sales Success!

But that’s still not all! The National Multihousing Council (‘NMHC’) and National Apartment Association (‘NAA’), in a recently released 700+ page realty investment and management tome, containing material contributed by COBA7®, added a ‘Sixth Right P’ to the already heady marketing mix: ‘Right Process’! And just what is Right Process? ‘It’s the planning and procedures SAVVY MARKETERS use to ensure (shelter) needs and wants of the target market, within one or more local housing markets, are fulfilled by the previous Five Right Ps of Marketing, i.e. Right Product (or Service); Right Place (or Location); Right Price (Affordable or not); Right Promotion (Print &/or online advertising, on & off-site signage, & public relations measures); using the Right People (Trained, motivated & supervised)!’ These ‘Six Right Ps of Marketing’ become both the ‘drivers & results’ of the ‘Seven P Rule’, where ‘Proper Prior Planning Prevents Pitifully Poor Performance!’ Or, put another way, ‘Failure to plan (marketing), is planning for failure (lack of marketing success)!’

So there you have it, the practical & comprehensive new housing sales and rental homesite leasing marketing tool, the ‘Six Right Ps of Marketing’!

And know what? If you’re in attendance at the LLLCommunity Owners Panel, at 10-11AM, on 20 January, at the Louisville MHShow, you’ll receive a new COBA7® Signature Series Resource Document titled: The ‘Six Right Ps of Marketing’- a training aid describing each of the six ‘Ps’ in detail! And the reverse side of this new one page training aid features the popular ‘Ah Ha! & Uh Oh! Worksheet’, used by many marketers and salespersons, to calculate – based on AMI &/or AGI*, just how much ‘house’ a homebuyer and or homebuyer/site lessee can afford, under Risky & Affordable lending circumstances. If you can’t attend this ‘already SOLD OUT KY show’, featuring Community Series Homes to buy, but want a copy of this new, Free SSRD, simply phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and ask for it.

End Note: (*) AMI = Area Median Income; AGI = Annual Gross Income (of a homebuyer or household). AMI/AGI on the ‘Ah Ha! & Uh Oh! Worksheet’ is $36,000.

II.

Perhaps the time has finally come…

To do what? Plan and effect substantial (not subtle) changes to (most, if not all) business models comprising the HUD-Code manufactured housing industry as we know it today, including land-lease-lifestyle community operations, housing affordability & housing finance.

At this point however, I’m going to stop penning this week’s blog posting. Why? Because the necessary, if not radical, business model changes, long talked about quietly and privately, were detailed to COBA7® in recent correspondence. They’re about the only change alternatives remaining – if the manufactured housing industry is to survive beyond year 2020! In the meantime, I’ll likely discuss said business model changes with MHInsiders at the Louisville MHShow. Then perhaps take the subject up again next week.

***

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Filed under: Uncategorized — George Allen @ 4:46 am

Perspective. ‘Land-lease-lifestyle Communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the national advocacy voice, official ombudsman (press), research reporter, & online communication media for all LLLCommunities in North America!

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 transform & improve MHBusiness Model Performance.’

.
I.

The ‘Six Right Ps of Marketing’!

So there you have it, the practical & comprehensive new housing sales and rental homesite leasing marketing tool, the ‘Six Right Ps of Marketing’!

End Note: (*) AMI = Area Median Income; AGI = Annual Gross Income (of a homebuyer or household). AMI/AGI on the ‘Ah Ha! & Uh Oh! Worksheet’ is $36,000.

II.

Perhaps the time has finally come…

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January 9, 2016

Three Questions; Panel Colloquy, & MH#s Finagling

Filed under: Uncategorized — George Allen @ 6:10 am

Perspective. ‘Land-lease-lifestyle Communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the national advocacy voice, official ombudsman (press), research reporter, & online communication media for all LLLCommunities in North America!’

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 transform & improve MHBusiness Model Performance.’

INTRODUCTIONS.

All COBA7® asks, is for you to keep three pithy questions in mind as events occur and issues unfold during year 2016! Methinks this is going to be a tumultuous time for the manufactured housing industry & land-lease-lifestyle community asset class. And you?

Best Way to Prepare! Participate in Louisville MHShow @ 20-22 January. Seek me out at the LLLCommunity owners panel presentation, 10-11AM on the 20th. Request a postcard describing ‘Two Days of Plant Tours & Home Sales Seminars’ in Elkhart, IN.

Finally; the (MH) industry will not recover, or revive the attention & support of would be homebuyers/site lessees, politicians, and media, until our national advocates ‘get their act together’! An appropriate place to begin would be to end misreporting of monthly ‘new HUD-Code home shipments’ to members and affiliates. If they can’t get their numbers right, why should anyone (e.g. federal legislators, regulators) expect anything else right?

Remember; this blog is the sole national MH trade publication, online and in print, that welcomes ‘your reaction & responses’ to matters presented in here, in the Allen Letter professional journal, & the Allen CONFIDENTIAL! business newsletter. Simply respond: gfa7156@aol.com or Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

FYI. 27th annual ALLEN REPORT was distributed this past week! Did you receive yours? If not, order it from COBA7® via Official MHIndustry HOTLINE listed above.

Those Three Pithy Questions…

Here’re the Three Queries Read & Parsed by Our MH Peers last Week…

• Is Duty to Serve simply another federal $$$ entitlement program, this time in the housing arena; and, is it as GOOD – or BAD, for the American taxpayer, as for prospective manufactured housing buyers & the manufactured housing industry?

• With HUD-Code manufactured housing all but ‘dead in the water’, WHY is HUD rejuvenating ‘Dispute Resolution’ & ‘Federal Installation Standards’, dormant since promulgation in 2007 – when new home shipments were already 90% fewer than in 1998, & double the low number (55,000/yr. average) they are today? $$$!

• Is manufactured housing better served, federally-regulated & protected; or better off shedding 40 year regulatory fetters, to operate freely among local housing markets throughout the U.S.? Stockholm Syndrome or Freedom? Follow the $$$!

Here’s a sampling of paraphrased responses, to these heady questions, received from blog floggers (readers) throughout the U.S.

• “Your blog was a good analogy (‘comparison’) for your readers to comprehend and open their eyes to business politics reality.”

• “Local land planning wins the housing battle as they have immediate local power, not the federal HUD department. A good point you made, on the HUD fee structure supporting the department’s existence, even with manufactured housing (nearly) Dead on Arrival. HUD doesn’t really want us (i.e. manufactured housing), GSE’s (& FHFA) do not support our specialty financing needs, and HUD effects no publicity whatsoever, relative to including HUD-Code homes in any of its’ new creations or raw land developments.”

• Relative to just the third question: “I choose freedom – but you already knew that.” NB

So, why does any of this matter, since ‘two of the cows, figuratively speaking, have already left the barn’? Here thinking, year 2007 ‘regulatory rejuvenation’ by HUD, & MHIndustry preference for ‘continued federal regulation of manufactured housing’

Perhaps making them ‘matters of record’, for the time being, to be recollected in the near or interim future – 1) when LLLCommunities have been ‘nickel & dimed’ nearly out of business, and 2) federal regulation has done nothing to improve new manufactured housing shipment volume! And, Duty to Serve? Well, the FHFA proposed regulatory rule, on this matter, is available for comment until March 2016.Have you formally commented? Ross Kinzler and I have. Now we wait to see what happens, if anything….

II.

A Panel Colloquy You Don’t Want to Miss!

LLLCommunity Owners to Address Topics & Field Questions at Louisville MHShow on 20 January 2016 at 10:00AM. Be there!

It’s not often successful, experienced owners/operators of land-lease-lifestyle communities make a public appearance together, for the express purpose of sharing unique and helpful Lessons Learned within this realty asset class.

Partial list of who’s presenting and what they plan to cover?

Brian Fannon, CPM®, from MI, will describe the ‘Repositioning of a Distressed (closed) community, considering current local housing market conditions and other factors.’

Nathan Smith, PHC®, from KY, will share trade secrets re acquisition of communities, then matching & ordering new HUD-Code homes per features, pricing & market needs.’

Mark Wisely, from IN., is excited about his firm’s use of ‘Insulated steel panels’ in his communities, and how ‘1BR HUD-Code homes, in his view, are an untapped market’!

When I posted this week’s blog, I didn’t have word as to what other panelists would be covering during their allotted time. Perhaps I will next time around…

As facilitator of the panel, I’ll not make a formal presentation. But rather, will distribute plastic 3X5” wallet cards describing the ‘Five Right ‘Ps’ of Marketing’! The beauty of this is, a ‘Sixth Right ‘P’ has recently been added to the heady sequence, and will be introduced publicly for the first time, at the Louisville MHShow! Come and get your card – as long as supply lasts.

See what I mean? This hour-plus opportunity, For You, is chock full of good and helpful information relative to land-lease-lifestyle community ownership and operation. Be there!

For registration information, phone Dennis Hill via (770) 587-3350 or via showways@bellsouth.net

And that’s not all! Spencer Roane, MHM®, of Pentagon Properties in Atlanta, GA., will be on hand, with his staff, to share his firm’s Lessons Learned relative to ‘Marketing of New HUD-Code Homes to the Hispanic Market!’ That session alone will see a full room!

Postscript.

This should be Headline News but isn’t! ‘How many COMMUNITY SERIES HOMES will be exhibited at this year’s Louisville MHShow?’ Anyone care to guess? Should be Dozens, and we hope that’s the case. I’ve already committed to a couple LLLCommunity owners, coming to buy CSH Models at the show, to photograph them, with their purchases, and run their stories in an upcoming issue of the Allen Letter professional journal. And hey, if YOU buy a new CSH Model at the home, let me know too! (317) 346-7156. One LLLCommunity owner/operator has committed to write and describe his/her experience ‘inspecting & buying’ a new Community Series Homes at this year’s show.

III

More Finagling of Monthly MH Shipment Numbers!

If a loyal reader of this weekly blog posting at community-investor.com, you’re already familiar with the contradictory reporting of monthly HUD-Code housing shipment numbers, compiled by the Institute of Building Technology & Safety (‘IBTS’), then reported to members and affiliates by MHARR, COBA7®, HUD, & the VAMMHA, versus a usually different total reported by MHI.

Well, we might just be at an impasse cum correction! On 4 January 2016, IBTS reported 5,980 new HUD-Code homes shipped during the month of November 2015. This same number was then reported to members and affiliates by MHARR, COBA7®, HUD, & the VAMMHA. However, as of 9 January, MHI had not reported November’s new HUD-Code home shipment total to members. If they adjust said IBTS figure, as in months past, their total will likely be 5,957. Or, they might start year 2016, by the same IBTS total as does MHARR, COBA7®, HUD, & the VAMMHA. Hmm. Guess we’ll just wait & see.

Now, here’s the newest #s rub! The latest HUD-Code homes shipment report from MHARR, also dated 4 January 2015, contains this basic, plus supplemental statement:

“…HUD Code manufacturers produced 5,980 homes in November 2015, a robust 20.6% increase over the 4,955 HUD Code homes produced during November 2014.” However…
‘
Here’s what MHARR did NOT tell their members: ’This 5,980 new HUD-Code homes total is 866 fewer homes than were produced in October 2015. And frankly, November’s 5,980 new HUD-Code homes are the fewest shipped since May 2015, six months ago!’

Nothing like ‘building one up’, when better served with a ‘dose of sobering reality’! And if this significant reduction in production, between October & end of November 2015, continues between November & end of December, there’s little reason to expect an annual cumulative total of 70,000 new HUD-Code homes shipped for year 2015!

Which, by the way, predicts yet a ‘third finagling’ of MHIndustry shipment totals. How so? Watch to see what MHARR, COBA7®, HUD, & VAMMHA report as the cumulative 2015 total, compared to a similar-but-likely-different total (maybe) reported by MHI. Notice IBTS is not mentioned in the previous sentence. Why? Because IBTS does not report annual cumulative totals of new HUD-Code homes shipped, as there’re ‘always’ Destination Pending units remaining at the end of every year, that make for an uncertain total. Now you know the rest of the story.

***

George Allen, CPM®, MHM®
COBA7®
Box # 47024,
Indianapolis, IN. 46247
(317) 346-7156

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January 1, 2016

Finally, Out into Open Discussion = 3 Serious Questions

Filed under: Uncategorized — George Allen @ 6:11 am

Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’

This blog posting is the national advocacy voice, official ombudsman (press), research reporter, & online communication media for all LLLCommunities in North America!

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 transform & improve MHBusiness Model Performance’

INTRODUCTION…Hang onto your seats for this one! What started as a review of last week’s ‘Question not addressed by national advocacy entities representing HUD-Code manufactured housing & land-lease-lifestyle communities’, blossomed into a recitation of not just the One, nor even Two, but Three ‘Serious Questions’! When you’re done reading and pondering, and have opinions, on one or more of these issues, tell us!

Finally, Out into Open Discussion!

Part III of last week’s posting of blog # 379, titled: ‘The Question’, Stirred Responses.

Realized, when I penned ‘The Question’ last week, I risked ire from certain industry leaders accustomed to charting manufactured housing’s political course without discussion among its’ businessmen and women. And while the expected ‘ire’ did not materialize, something else did: Yet another ‘Serious question NO national (MHIndustry) advocacy group has publicly addressed’ to date!

But first, a rewording, for clarity; and brief revisiting, of ‘The Question’ posed in last week’s blog:

Duty to Serve. Is the regulatory manipulation of, and political/lobbyist pressures on GSEs (i.e. Fannie Mae & Freddie Mac fiscal policies, via conservator, Federal Housing Finance Agency, et. al.), to accommodate ‘underserved’, low income, would-be homebuyers and mortgagors, GOOD for consumers – and the manufactured housing industry (i.e. increasing monthly volume of new HUD-Code home shipments), but BAD for U.S. taxpayers, by dint of adding yet another ‘$$$ entitlement program’, given the dire $$$ consequences within the same politico-socio GSE arena between 2008 & now? (*1) Think about it. Talk about it. Decide how you feel and let your national advocate know!

’The (same) Question’, again – but from a different perspective: ‘Do we really want to risk going down the same or similar $$$ entitlement road again so soon?’ Here’s one recent, very public private enterprise perspective, on the same Duty to Serve matter!

Recently published (26 December 2015) point & counterpoint exchanges of critical and at times vitriolic views, in an article in the Seattle Times, and Press Release response by Clayton Homes, Inc. (& by extension, Warren Buffett, Berkshire Hathaway, 21st Mortgage Corporation, and Vanderbilt Mortgage & Finance, Inc.), describes what befell this private enterprise, attempting to unilaterally accommodate ‘underserved’, low income, would-be homebuyers and mortgagors; to wit: the firm ran afoul of social activists unwilling to examine, let alone understand, negative consequences of uncomfortable personal and familial details (e.g. being underqualified & exhibiting intermittent irresponsibility) oft characterizing this market.(*2) Like borrowing President Obama’s recent use of this metaphor: “If you’re doing big hard things (‘Think Clayton Homes here’), there’s going to be some hair on it – there’s going to be some aspects of it that aren’t clean and neat…” Bottom line? Given this private enterprise Duty to Serve perspective (i.e. corporate desire to supply ‘affordable’, not ‘subsidized’ housing), expect to be misunderstood – and worse, especially when doing so over the long haul…

***

And now, here’s the new ‘Serious Question no national (MHIndustry) advocacy group has addressed to date’ – arriving at this website in the form of correspondence from a longtime blog flogger (reader), and supplemented with industry statistics provided by the MHIndustry historian:

‘The (new) Question’. “Why rejuvenate federal regulations effected in 2007, affecting manufactured housing & land-lease-lifestyle communities, left dormant until now?”

In 1998, the manufactured housing industry’s most recent and likely last renascence, 372,843+/- new HUD-Code homes were shipped throughout the U.S. At the time, responsibility for the safe and secure new home installation was a heady and very public topic of conversation. Disputes among manufacturers, MHRetailers and homebuyers were aplenty.

Consequences, and planned but interrupted changes, in the MH business environment. In year 2000, the Manufactured Housing Improvement Act was passed – but arguably, never fully implemented. This was followed, seven years later, by Dispute Resolution & Federal Installation Standards. By then however (2007), given the loss of ‘easy access to chattel capital’, new HUD-Code home shipments plummeted to only 95,769+/- units! That downward spiral continued thru 2009, when only 49,789+/- new homes were shipped! A 7 ½ fold DROP in new HUD-Code home shipments over a decade!

POINT? The manufactured housing industry, by 2007, and certainly by 2009, 1) Wasn’t doing enough business to fund its’ regulator (i.e. HUD) via label fees, and 2) There weren’t enough homes being sold and installed to raise concerns, nor were there many disputes to resolve! And frankly, these matters are unchanged to this day, with an average of only 55,146+/- new HUD-Code homes shipped per year between 2009 & 2014. Year 2015? Maybe 70,000+/-, but compare that to the fivefold higher volume of 372,843 units in 1998. So, too few new HUD-Code homes to install, even fewer disputes to resolve!

So, why not leave the sleeping (some say, ‘dying’) dog lie? Or to put it another way, ‘What’s caused HUD to unilaterally rejuvenate federal regs effected in 2007, that are now, arguably unneeded?’ As they say, ‘Follow the money!’ If HUD continues to oversee the manufactured housing program, it will need income to pay its bills (e.g. inspectors, staff). (Read End Note #3) Where’re $$$ to come from? Primarily HUD label fees – already jacked more than 100 percent a scant two years ago. But with monthly and annual new home shipments at historic lows for nearly a decade, and unlikely to change (without reasonable access to chattel capital), additional oxen will have to be gored! Whose? Think land-lease-lifestyle community (a.k.a. manufactured home community) owners/operators nationwide! How so? To begin with, Dispute Resolution is ‘dead on arrival’ – given so few cases filed during the past decade. But HUD administering the Federal Installation Standards in default states, is where the monies will likely be found, at least for the time being. Just ‘how’ will be worked out during the months ahead, as LLLCommunity owners/operators pay their way, via installation inspection fees and the federal regulatory process. Even the ingenious Frost Free Foundation®, at one time viewed as our industry-saving ‘silver bullet’, regarding new home installation, has been stymied! How so? HUD-Code home manufacturers appear to be avoiding overt approval of FFF in installation manuals delivered with new homes. Why? Ask them. Might be their lack of confidence in licensed installers and LLLCommunity developers and owners/operators, to properly implement said FFF system. Sad, but likely true.

So, what’re the two national advocacy bodies, one of which claims representation of the entire manufactured housing industry, doing to mitigate the arguable negative effects of HUD’s unilateral rejuvenating of 2007 era regs, where new home installations in LLLCommunities are concerned? Little to nothing! Why? Ask them! After all, their MH program director of choice is in the driver’s seat at HUD. Likely however, this benign neglect has to do with the primary controlling nature (i.e. home manufacturers) of their direct, dues-paying membership. NOTE. A possible unintended consequence of ‘not publicly addressing this serious question’? The ‘beginning of the end’ where LLLCommunities are concerned. We’re not building many new such income-producing properties (Read details in the 27th annual ALLEN REPORT), and the small, older properties (i.e. 85+/-% of estimated 50,000+/- LLLCommunities in the U.S. today) lack financial resources to replace adequate existing installation infrastructure @ $5,000+/-/rental homesite, when a new HUD-Code home arrives on-site! Could well be rocky years, 2016 & 2017, ahead for the realty asset class.

In closing, also know year 2016 commemorates the 40th anniversary of HUD’s (performance-based, federally preemptive, national building code) regulatory relationship with the manufactured housing industry. Watch for a soon to be released feature article, in either a HUD or manufactured housing-related publication, describing this ‘From Lemon to Lemonade’ partnership between years 1976 & 2016.

***

Postscript. Believe it or not, there’s a third ‘not so new but never publicly discussed question’, related to the second one (above), imbedded within End Note # 3 here following. You’ll want to read and ponder it as you did the first two hush-hush questions.

***

End Notes.

1. Though some say 1992, when Congress imposed affordable housing goals on the two GSEs, requiring them “…to guarantee certain numbers of mortgages made to lower income borrowers.” From P. 46 of Bethany McLean’s SHAKY GROUND, ‘The Strange Saga of the U.S. Mortgage Giants’, Columbia Global Reports, NY, 2015, 159 pages. A succinct history of Fannie Mae & Freddie Mac since the turn of the century.

2. SEATTLE TIMES, ‘Minorities Exploited by Warren Buffett’s mobile-home empire’, by Mike Baker & Daniel Wagner. Dated 26 December 2015

Versus

Press Release: ‘Reporting Mischaracterizes Clayton Homes’ Treatment of Customers and Employees’…’Company Serves Underserved Markets, Making Homeownership Affordable.’ Dated 26 December 2015

3. Here goes. ‘More than rumor has it’, HUD sought to sunset (i.e. ‘terminate’) the manufactured housing program a few years ago, when it became obvious label fees from 50,000+/- new HUD-Code homes shipped per year, would not adequately fund department activities in this area. GAO interviews with manufactured housing businessmen and women, at the time, alerted the industry to this serious, but also potentially ‘freeing’ impasse. What’s happened since then is now history, in large part kept quiet, and only hinted at within exposes’ such as this. Hmm. Wonder who reading this though, is astute enough to see the ‘third (unanswered) question’ concealed within the shadow of this recitation, i.e. ‘Is manufactured housing, as an industry, better served as a federally-regulated & protected shelter type; or better off, shedding 40 year old regulatory fetters and operating freely among local housing markets (Yes, and having to please, and negotiate with, NIMBY-tainted land planners, and LULU zoning boards) throughout the U.S.?’ (See # 4) What do you think? Inquiring readers of this weekly blog posting would like to know. Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764

4. NIMBY = ‘Not in my back yard!’; LULU = ‘Locally Unwanted Land Use’; &, BANANA = ‘Build Absolutely Nothing Anywhere Near Anybody!’ = ‘the Big Three Acronym Barriers to Affordable Housing in Many Local Housing Markets Coast to Coast’. GFA

NOTE. If you’re not already affiliated with the Community Owners (7 Part) Business Alliance®, a.k.a. COBA7®, you should be! Why? Because no one but no one provides more land-lease-lifestyle community-related products & services (e.g. ongoing statistical research, 12+ Signature Series Resource Documents & Directories, weekly & monthly print & online media (Like what you’re reading here, plus two hard copy monthly newsletters), superb networking & deal-making opportunities, professional property management training & certification via the Manufactured Housing Manager®, or MHM® program, even national advocacy when need be…official ombudsman (press) & historian for the manufactured housing industry!) To affiliate, simply use the Official MHIndustry HOTLINE given in End Note # 3 above, or use COBA7® brochure attached to BEBA (Blast Email Blog Alert) introducing this week’s blog posting # 380…

FYI.

Next MHM® class is on 19 January 2016 in Louisville, KY. Only $250.00/person. Team taught by Katie Hauck, MHM® & GFA. Phone (317) 346-7156 for a brochure and or to register. Class limited to 20. Note: 1,000 MHM®s now own/operate LLLCommunities throughout the U.S. & Canada! Are YOU certified? This is your opportunity to do so!

Five LLLCommunity owner panel @ 10-11AM, the morning of 20 January at the Louisville MHShow in Kentucky! If you own/operate one or more LLLCommunities you don’t want to miss this unique opportunity to learn from five successful owners who’ve ‘experienced it all’. To register, phone Dennis Hill via (770) 587-3350 or via showways@bellsouth.net I’m facilitating this panel discussion, so expect The Very Best!

And on the 21st, Spencer Roane, MHM®, along with his Atlanta-based staff will teach the basics of ‘Marketing New HUD-Code Homes to Hispanics’. Nowhere else will you find this training in 2016. Again, it’s at the Louisville MHShow. Call Dennis Hill. I certainly plan to be in the audience. Will you?

Finally; Pam Danner, manufactured housing program chairman for HUD will address the Louisville MHShow on the 21st of January. Wonder if anyone there will be bold enough to ask her the second question posed in this week’s blog posting? I plan to be in that audience as well. You owe it to yourself to learn as much as possible about HUD’s plans for the year ahead.

And, if you’re interested in participating in the ‘Two Days of Plant Tours & Home Sales Seminars’ planned for late Spring (2016) in the Elkhart, IN., area, ask me for a postcard when we network at the Louisville MHShow in mid-January. Filling in and returning said postcard gets you onto the ‘inside track’ where this first time ever educational and ‘first hand experience’ event is concerned. Especially designed for small to mid-sized LLLCommunities throughout the Midwest.

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