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

October 24, 2019

Meet FMR (&) News From MHI & IREM

Filed under: Uncategorized — George Allen @ 10:57 am

@ 25 October 2019;

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

This blog is the online national advocate, official ombudsman, asset class historian, researcher, education resource & communication media for land lease communities in North America!

To input this blog &/or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email & visit

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INTRODUCTION: I’m almost as pumped about the potential use of Fair Market Rents (‘FMR’), introduced in Part I of this blog posting, as I was when introducing the land lease community Industry Standard Chart of Accounts & Operation Expense Ratios (‘OERs’) in 1992; and the unexplainable but so useful New Rule of 72 formula for estimating capitalized income value of average communities. Let’s see if FMR ‘works’ for you! And then there’s the timely and interesting news about IREM and MHI.


Fair Market Rents. A Tool or Red Herring?

This from a Press Release dated 19 September 2019. “HUD has published the Fiscal Year (FY) 2020 Fair Market Rents (FMRs), which are now released only on, under a provision of the Housing Opportunities Through Modernization Act of 2016 (HOTMA), enacted July 29, 2016.” Furthermore, “…the FMR for any (geographic) area is the ($) amount… needed to pay the gross rent (shelter rent plus utilities) of privately-owned, decent and safe rental housing of a modest (non-luxury) nature, with suitable amenities.”

The question in this industry observer’s mind is this: ‘Might FMR be the long sought tool to estimate and validate rental homesite rates in land lease communities throughout the U.S.? Or is FMR just another ‘red herring’ that misleads us off the trail to reasonable profitability? Let me walk you through the process, using one of our realty asset class’ Rules of Thumb, so you can make up your own mind. Here’s the drill:

1. Google or search Fair Market Rents 2020.
2. Once ‘there’, access the website subtitled HUD User & left click on Select Geography.
3. Once ‘there’, left click on Statewide FMRs
4. Once ‘there’, left click on city of choice

Now the fun begins.

For this blog posting I chose three MSAs (Metropolitan Statistical Areas): Atlanta, GA., Indianapolis, IN., and Los Angeles, CA. At each MSA, I selected the ‘three bedroom FMR’ – as being equivalent to a manufactured home, then divided by three, to apply the 3:1 Rent Ratio Rule of Thumb, for comparing land lease community site rent rates to conventional apartment 3BR2B unit rates. And then divided the original FMR by two, to see what land lease community site rent rates might be, as result of aggressive increases. Here’re the interesting results:

City FMR 3:1 Ratio 2:1 Ratio

Atlanta, GA. $1,489/unit $496/site $745/site

Indianapolis, IN. $1,256 $419 $628

Los Angeles, CA. $2,514 $871 $1307

How do these rental homesite rents compare to the 2018 JLT Market Report Summary for Institutional Investment Grade Land Lease Communities, published as an integral part of the 30th anniversary ALLEN REPORT? To secure a copy of this Resource Document, visit

Atlanta, GA. $463/site among all-age communities

Indianapolis, IN. $380/site among 55+ communities

Los Angeles, CA. $759/site among 55+ communities

Remember now, these latter rental homesite rates, from the 30th ALLEN REPORT are from two years earlier, while the FMRs in the previous paragraph are estimates going into year 2020.

Obviously this methodology bears further scrutiny. But for the time being, this should be a valid and interesting exercise for you, to compare the rental homesite rents at your land lease communities with the FMRs for 2020 provided by HUD User.

A note of caution. Remember, in the cited Press Release, the HUD made it clear the FMRs, per geographic area, are dollar amounts needed to pay gross rent (shelter rent plus utilities) – not a practice generally characteristic of land lease community rental homesite rates. How to account for the difference? Research what homeowners/site lessees are paying for household utilities, on a monthly basis, and adjust FMRs accordingly – or not.

Also know the 31st ALLEN REPORT will be distributed during January 2020. To ensure you receive a copy, visit


News from IREM & MHI

Institute of Real Estate Management (‘IREM’) now stocks and sells the iconic professional property management text Community Management in the Manufactured Housing Industry. First published in 1988 as Mobile Home Park Management, the 250+ pages HOW TO book has gone through eight edition updates and four name changes during the past 40 years. It continues to be the only book in print, teaching what one needs to know about effectively managing land lease communities, large and small. It has also been the core text for the popular Manufactured Housing Manager class since its’ debut a dozen years ago. To date, nearly 1,500 MHMs own and operate land lease communities throughout North America.

To order the book, visit or visit And while at the EducateMHC website, sign up for the next one day MHM class, at the Louisville MHShow in mid-January.

IREM also released its’ annual CPM Profile & Compensation Study (executive summary thereof).

“The average Certified Property Manager is 52 years old, with women comprising 54% of CPM members.” Furthermore, “CPM members (of IREM) earn a median total compensation of $126,000, which includes a base salary and additional real estate income from sales and leasing commissions.”

According to IREM’s membership directory, 147 CPMs claim an affinity for managing manufactured home communities. 14 of these CPMs have cultivated positive national reputations among their land lease community ownership/operations peers. And four of these CPMs have achieved Emeritus status with IREM, while three have been inducted into the prestigious RV/MH Hall of Fame in Elkhart, IN: George Allen, CPM; Brian Fannon, CPM; and Michael Sullivan, MHM.


The Manufactured Housing Institute (‘MHI’) continues to make lobbying headway, in behalf of manufactured housing, by dint of its’ political and regulatory agency relationships with the present administration, HUD, the FHFA, and both GSEs.

At the same time, MHI appears to be undergoing a seismic shift in volunteer and salaried leadership at the top of the organization. Everyone know Dick Jennison will be leaving at the end of this year, but to date, no official (just rumored) word of succession relative to CEO/president and COO positions. And at least two key staffers have left the institute during the past 90 days.

And inquiring minds are sensitive to the present (2020) reality of having four Berkshire-Hathaway corporate executives on MHI’s board going into the New Year, with no representation from Skyline Champion and Cavco Industries.

Maintaining lobbying balance in all this, we have MHARR representing smaller, regional HUD-Code housing manufacturers, and NAMHCO representing land lease communities nationwide.


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