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

Blog Posting # 675 @ 4 February 2022: EducateMHC

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

EducateMHC is the online national advocate, realty asset class historian, trend spotter, education resource & textbook supplier for land lease communities throughout North America!

To input this blog and or connect with EducateMHC, telephone (317) 881-3815, email gfa7156@aol.com and/or visit www.educatemhc.com Previous phone #s no longer connected.

Motto: ‘U Support US & WE Serve U!’ Goal: to promote HUD-Code manufactured housing and land lease communities as U.S> # 1 source of affordable attainable housing! Be MHM certified!

INTRODUCTION: OK; two somewhat related but different topics this time around. First, by how much, the price of (some) new HUD-Code manufactured homes, during year 2021, exceeded the benchmark FHFA House Price Index during the same period of time.*1 Then, comparing rental homesite rates at two – one on the east coast, another on the west coast, of the most luxurious (on one hand) and iconic (on the other) land lease communities in all the U.S.*2 No potpourri this week.

End Notes.

1. FHFA = Federal Housing Finance Agency (oversees the two GSEs: Fannie Mae & Freddie Mac).

2. ‘Iconic’ = “a representation that stands for something by virtue of a resemblance or analogy of it”. Webster’s dictionary. In this case, as an example of what the ideal land lease community might be like.

I

COMPARING HOUSING PRICES!

Let’s begin with the FHFA House Price Index published to the public on 25 January 2022. Here goes: “FHFA House Price Index UP 1.1 Percent in November: Up 17.5 Percent from Last Year. Got that? 17.5% overall U.S. housing price index increase during year of the pandemic, 2022.

Now, quoting from email messages from veteran land lease community portfolio owners/operators who routinely buy new HUD-Code manufactured housing direct from factories, then sell/finance them on-site, once affixed to rental homesites within the properties:

“The base price of the _____model, on attached (factory) pricing ‘adjustment’ letters, increased from $65,826 during January 2021, to $85,505 during February 2022. That’s a 29.9 percent increase in 13 months!” (&)

“The attached spec price on a 3BR 16X76 manufactured home, with standard options, has increased from $45,787 in October 2020, to $56,125 during January 2022. That’s a 22.6 percent increase in 15 months.”

Bottom line? While not really comparing apples to apples (i.e. rather, all types of single family residential housing vs. new manufactured homes), it’s still instructive to observe how new HUD-Code manufactured housing is selling from 5.1 to 12.4 percent higher price than the national housing market at large.

A question for you, especially if you’re a dues-paying member of the Manufactured Housing Institute: Will this price imbalance, between housing at large and new manufactured homes be on the winter meeting agenda, 9-11 February, in New Orleans? Answer. At present, NO.

II.

RENTAL HOMESITE RATE EXTREMES

Now, before you go apoplectic on me, when reading what follows; understand this: the two land lease communities involved here are, for different reasons, well beyond the pale (‘a strictly bounded area’) of usual community characteristics.*1

First, the properties themselves. Baywood community, outside Lewes, DE., looks every bit the very upscale subdivision, featuring large two story homes on spacious rental homesites. And the property itself is surrounded by tournament grade golf courses, a fine dining restaurant, golf driving range, and so much more.

Lido Peninsula in Newport Beach, CA., is a really an old ‘mobile home park’ that’s been upgraded at least twice during the past two decades, with two story HUD-Code manufactured homes.*2 Here’s the secret ingredient. The two story (doll-like) houses are affixed to the same ‘footprint’ used by the original mobile homes of yore! That’s why they’re two stories in height. And the homeowners/site lessees panoramic view of the Pacific Ocean is breathtaking.

OK, now for the rental homesite rates characteristic of these two special properties.

A townhome, with 2,700 square feet living space, located on the 18th fairway at Baywood, is on sale today for $399,000. The lease fee? $1,419 per month; same as other rental homesites.

Average rental homesite rent at Lido Peninsula is more than $3,000 per month.

But know what? There are additional ‘special’ land lease communities scattered across the U.S. and Canada. In certain local housing markets where we can match, even better, conventional housing available for sale. Yes, and in certain rural areas of the U.S. it’s still possible to find, usually smaller, land lease communities, where rental homesite rents remain at. or only slightly more than, $100. per month.

End Notes.

1. Apoplectic = “a sudden, usually marked loss of bodily function due to rupture or occlusion of a blood vessel”. Webster’s dictionary

2. Lido Peninsula was built in 1949 with 26 units to the acre. Today, thanks to the forward-looking planning and efforts of Richard Bessire of Bessire & Casenhiser, new Fleetwood two story homes, at 1,200 square feet, are being sited and will likely rent for more than $7,500/month.

III.

RECOMMENDED ALTERNATIVE AGENDA

No, I won’t be attending MHI’s winter meeting in New Orleans on 9-11 February. Oh, I encourage you to attend, if you’re active in manufactured housing and or land lease communities. I just won’t be going – for good reason – beyond the fact I’m pretty much retired these days and soured on travel. No, it’s much more for the reason here following…

I prefer ‘meat & potato’ issues to be on the agenda of any national trade association meeting I attend, whether it be MHI, IREM, SECO, or otherwise. And just what are such issues? Already identified one candidate in Part I of this week’s blog posting. Here’re three more:

Dire need for Creation and Funding of a National Marketing Campaign, sans specific brand promotion, of HUD-Code manufactured housing! This has been of, sad to say, behind the scenes interest among some manufactured housing aficionados and land lease community owners/operators, since at least the Networking Roundtable held in Mystic, CT., nearly two decades ago. Kevin; remember? Many land lease community folk do. It’s time to act!

Is rampant Consolidation improving or destroying manufactured housing and land lease communities? Won’t attempt to ‘make the case’ either way here, but surely you’ve seen, read, and heard the pros & cons on both sides that fence. If not, ponder how and why only three ‘consolidating’ HUD-Code manufactured housing firms now boast more than 80 percent of national housing market share. And among communities, what to do about the predatory real estate investment and operation practices of some ‘consolidating’ firms nationwide these days?

When was the last time you heard these two troublesome topics discussed and debated – with an eye to resolution, at any national trade gathering during 2019, 2020, 2021, and now 2020?

There’s more I’d like to say on this timely, and in my opinion, critical alternative agenda subject, but won’t for now. But here’s a hint of are more ‘meat & potato’ issues begging attention.

• The perceived lack of ‘equity’ for manufactured homes and prospective purchasers of ‘affordable housing’

• An upcoming White Paper “…relating to the exploitation of federal housing funding and assistance, for purely public relations purposes, by ostensible representatives of the industry’s post-production sector.”*1

• How “…the two most dominant manufactured housing lenders…control a ‘combined 30 percent’ of the manufactured housing market, including 56 percent of chattel lending’….”

To learn more about these three bullet points, phone (202) 783-4087 and request a copy of ‘Issues & Perspectives’, dated January 2022, penned by Mark Weiss.

What additional ‘meat & potato’ issues, not listed here, come to your mind? Let me know via gfa7156@aol.com

End Note.

1. Would someone please define ‘post-production’ for me, relative to composition and scope as an industry sector? It appears to have become, in my opinion, a convenient ‘whipping boy without explanation’, to some folk in manufactured housing.



George Allen, CPM, MHM
EducateMHC

Blog Posting # 674 @ 28 January 2022: EducateMHC

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

EducateMHC is the online national advocate, realty asset class historian, trend spotter, education resource & textbook supplier for land lease communities throughout North America!

To input this blog and or connect with EducateMHC, telephone (317) 888-3815, email gfa7156@aol.com and/or visit www.educatemhc.com Previous phone #3 no longer connected.

Motto: ‘U Support US & WE Serve U!’ Goal: to promote HUD-Code manufactured housing and land lease communities as U.S. # 1 source of affordable attainable housing! Be MHM certified!
_____________________________________________________________________________\

INTRODUCTION: The Great Reset, it seems, is on just about everyone’s mind these days – even the folk in manufactured housing, based on the encouraging email responses received to date. And ladies, get familiar with WAMH – you’ll likely want to participate in this latest advocacy in behalf of manufactured housing and land lease communities. And POTPOURRI is back with more wise and pithy information and advice. GFA

I.

‘GREAT RESET’ REVISITED

It’s easy to tell when I ‘hit a nerve’ with a blog posting. The email messages and phone calls pour into me. Such was the reaction to last week’s posting titled: ‘A Great Reset For Manufactured Housing & Community Portfolios?’ Equal number of responses from the housing manufacturing side of the industry and community portfolios.

“This Great Reset will take time. I’d emphasize rural housing, retirement cabins, RVs for low cost family and transient labor, making manufactured homes coded – e.g. UBC or whatever, to ease acceptance by a well-established and respected NAHB.”

“I read your blog. This is one of your best. (&) Redouble one’s efforts to have all in-community homes looking great, and homeowner/site lessees (my term, GFA) fully engaged in promoting the land lease community lifestyle. “I would never have asked DC for help George. Geesh!”

Further thoughts on the subject. While the final tally won’t be effected for another week (i.e. Think 1 February 2022), we’ll certainly, as an industry, eclipse the 100,000 shipments of new HUD-Code homes, unseen since year 2006 and its’ tanking figure of 117,510+/-.*1 Hmm. Wonder if we’ll meet or better the 2005 figure of 146,644 – or 146,744 – depending on who one asks? In any event, as I’ve pointed out before, it’s unlikely we’ll ‘ever’ return to the acme year records of 372,943+/- in 1998 (Ah, the year of the Developer Series homes) and 579,940 in 1973. Wonder what blame corporate ‘consolidation’ plays, if any, in this compression of national market presence? And likewise, where community portfolios are concerned; will continued ‘consolidation’ (i.e. absorption of smaller property portfolios into larger ones), have minimal or profound effect on sole proprietorship development of raw land into full scale land lease communities? So there’s still a lot out there to think about relative to a Great Reset for manufactured housing and land lease communities.

End Note.

1. Why the +/- clarification of some annual MH shipment totals? In those instances, according to comprehensive listings (i.e. from 1955 to present day) in the text SWAN SONG, there are, and continue to be, different annual new HUD-Code housing shipment totals researched by the Institute of Building Safety & Technology (‘IBST’) and reported by HUD and MHARR, compared to similar-but-different totals posted by the Manufactured Housing Institute (‘MHI’) and its’ member companies. To order a copy of said text, visit www.educatemhc.com


II.

HISTORY REPEATING ITSELF?

We’ve been here before! The current issue of MHINSIDER magazine, in a feature article penned by publisher Patrick Revere, ‘New Organization to Advance Women in Manufactured Housing’ introduces readers to Women Advancing Manufactured Housing or WAMH. He introduces Maria Horton, MHM, of Newport Pacific Family of Companies, and Justine Natalie of Dynamic MH Solutions as two of five organizers of this effort to advocate for manufactured housing and land lease communities. Three additional organizers include Sherrie Clevenger from CoreLogic, Maryuri Barberan, MHM, from Pentagon Properties, and Kim Schultz-Rainford from Innovative Housing Solutions. Plans for WAMH took shape during a roundtable discussion at the recent SECO conference.

What’s the precedent to WAMH? Well, way back in the mid-1990s, around the time MHI’s National Communities Council (‘NCC’) division took shape, a group of female owners/operators of (then) manufactured home communities agreed to meet at annual Manufactured Housing Congress events in Las Vegas, to network and work together to advance the role of women in the manufactured housing industry. The name of that group was Manufactured Housing Executive Women, or MHEW for short. Two contemporary RV/MH Hall of Fame inductees, Christine Lindsey, MHM, of UMH Properties, and Dee Pizer, MHM, of Zeman MHC, were among that august group. While all started off well and enthusiastically, in a few years, interest in the group waned, and it eventually stopped meeting.

This time around, given the proven leadership abilities of the five organizers, expect to see WAMH grow and take a place among organizations dedicated to advancing women executives throughout the manufactured housing industry. If interested in getting in touch with these women, let me know via gfa7156@aol.com


III.

SOME MORE POTPOURRI

Here’s a Short Course in Human Relations, dating all the way back to the year 1978 or before.

The 6 most important words: ‘I admit I made a mistake’

The 5 most important words: ‘You did a good job’

The 4 most important words: ‘’What is your opinion?’

The 3 most important words: ‘Will you please?’

The 2 most important words: ‘Thank you!’

The 1 most important word: ‘We’

The least important word: ‘I’

Those of you who’ve read my autobiography, From SmittyAlpha6 to MHMaven, now know that besides being a USMC combat engineer officer, while in Vietnam during 1968 & 69, I was trained in Okinawa, to be an Atomic Demolition Munitions (‘ADM’) technician. It paid an extra $100.00 per month. And I was expected, when so ordered, to mate up with my ADM (the size of a soccer ball and strapped to my chest) to be transported by low flying helo, into North Vietnam, near Hanoi. There I’d emplace the ADM, set the timer and ready the firing device before attempting to return alone to South Vietnam. I recently came across more information about the previously secret ‘back pack nuke’, powerful enough to “destroy a dam…drop a mountainside down on an invading army, vaporize essential command and control installations, wipe out a large formation of tanks….” Nuclear weapon protocols at the time required two technicians present when utilizing ADMs, but the Marine Corps opted for just one man. There are two photographs in the aforementioned texts showing just how destructive ADMs could be.

You from Michigan? Well nearly a quarter century ago the Michigan Department of Labor, Safety Education, and Training created and widely distributed a set of 2 ½” X 4 ½” business card-like paper instructions relative to SKILL in LEADING, SKILL in PLANNING, SKILL in INSTRUCTION, and several additional topics. I came across the cards early on in my management career and have shared their wisdom widely. For example, here are the four steps recommended ‘How to Handle a Problem’:
Get the Facts. Be sure to have the whole story.
Weigh and Decide. Don’t jump to conclusions.
Take Action. Don’t pass the buck.
Check Results. Did your action help operations?

In this instance I used this Michigan wisdom to create and copyright the first of five Management Wisdom cards (1979) – since distributed in every MHM class. My parallel?
Select a Problem, a Task – Consider it a challenge, an opportunity.
Define it, Document it.
Study & Question Every Detail
Research & Organize Data
Refine & Digest Data
Produce & Rework Ideas
Implement & Monitor
Follow-up & Recap Results.
If you’d like a free copy of this Management Wisdom card, let me know via gfa7156@aol.com

Are you interested in learning ‘How to Eat Crawdads’? Maybe I’ll have nerve to share with you in days to come. For now, here’re the first and last paragraphs:
“Use only live, healthy crawdads. Boil until they turn red and float to the top, usually about eight minutes after the water returns to a roiling boil. The rule of thumb is a gallon of water to two pounds of crawdads.” (&)
“The only adult drink permitted with boiled crawdads is beer. Kids can drink soda. Leave the wine in the cellar.”
Oh yes, there’s more….



George Allen, CPM, MHM
EducateMHC

Blog Posting # 673 @ 21 January 2022: EducateMHC

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

EducateMHC is the online national advocate, realty asset class historian, trend spotter, education resource & textbook supplier for land lease communities throughout North America!

To input this blog and or connect with EducateMHC, telephone (317) 888-3815, email gfa7156@aol.com and/or visit www.educatemhc.com Previous phone #s no longer connected.

Motto; ‘U Support US & WE Serve U!’ Goal: to promote HUD-Code manufactured housing and land lease communities as U.S. # 1 source of affordable attainable housing! Be MHM certified!

INTRODUCTION: This week’s posting ranges from the very serious (Part I,) to a mixture of humor and wise advice (Part II). While I don’t want to come across, in my writing, as a naysayer or pessimist, I do have serious concerns about the present and future viability of our industry and its’ real estate component (i.e. land lease communities). This week I only scratch the surface of such concerns; attempting to remain positive throughout the commentary. GFA

I.

A ‘GREAT RESET’ FOR MANUFACTURED HOUSING & COMMUNITY PORTFOLIOS?

By now many, if not most, Americans have at least heard of the coming Great Reset.
Is it “…a conspiracy theory imagining a vast left-wing plot to establish a totalitarian one-world government?” OR, simply “…a means of addressing the ‘weaknesses of capitalism’ purportedly exposed by the COVID pandemic.”?*1 Or, something altogether different?

Historically, the phrase ‘Great Reset’ became commonplace upon publication of the 2010 book, ‘The Great Reset’, by Richard Florida. Here, the author suggested the 2008 economic crash was the most recent Great Reset; others being the long depression of the 1870s and Great Depression of the 1930s. The World Economic Forum (‘WEF’) in Switzerland, in its’ recent book, ‘COVID-19: The Great Reset’, suggests ‘weaknesses of capitalism’ were exposed by the COVID pandemic.

Two months before the COVID outbreak in China hit the news scene, the WEF, with others, engaged in a pandemic exercise, ‘Event 201’, simulating an international response to an outbreak of a coronavirus. Results closely resembled what happened during the future COVID scenario, hence the tie to it being another Great Reset. And shortly after its 50th meeting, during June 2020, the WEF declared “…COVID represents an ‘opportunity (to) be seized’, to reimagine our world by …”Big Tech companies like Apple, Google, Facebook, and Amazon….” to introduce a bewildering economic amalgam (‘combination or compound’) ‘stakeholder capitalism’, a.k.a. ‘corporate socialism’; some say ‘communist capitalism.’*2

A consequence of this social justice aspect of the Great Reset? “…government, banks, and asset managers use the Environmental, Social & Governance (‘ESG’) index to squeeze non-woke corporations and businesses out of the market.” It’s essentially a social credit score used to drive ownership, even control production, away from those non-woke and non-compliant.*3

Specifically, “…the governmental favoring of industries and players within industries – what used to be known as corporatism or economic fascism”…continues in play during the Great Reset. (as) “Approved corporations’ tend towards monopolization, exercising control over production and distribution IN AS FEW FAVORED CORPORATIONS AS POSSIBLE, while eliminating industries and producers deemed non-essential or inimical (‘harmful’).” WHOA! Some will argue this is already happening, via industrywide consolidation, among HUD-Code housing manufacturers….think of the Big 3-C corporations ostensibly controlling proceedings of the Manufactured Housing Institute – and its National Communities Council division.

So, has the Great Reset already impacted (i.e. impacting) manufactured housing and community portfolios in the fashion just described?

We’re about to find out as we move further into year 2022. Will the Big 3-C corporations grow to claim more than 80 percent national market share of manufactured housing shipments? Will (some) land lease community portfolio owners/operators continue to negatively impact local rental housing markets with exorbitant site rent rate increases and imposition of other add-on homeowner/site lessee expenses? If so, don’t be surprised when a Great Reset negatively affects our industry and realty asset class in ways not experienced before!

If you have personal commentary on the Great Reset scenario, reach me via gfa7156!aol.com

End Note.

1. Quotes in this posting are from a speech, by Michael Rectenwald, delivered at Hillsdale College on 7 November 2021, and published in the December issue of IMPRIMIS newsletter.

2. “…stakeholder capitalism involves the behavioral modification of corporations to benefit not shareholders, but stakeholders – individuals and groups that stand to benefit or lose from corporate behavior.” Hard not to think of pending landlord/tenant legislation relative to land lease communities nationwide….GFA

3. ESG. Three key factors measure the sustainability and ethical impact of an investment in a business or company. Here we have our first hint of how the Great Reset might influence and impact the manufactured housing industry; e.g. Governance criteria…how a firm polices itself, focusing on executive remuneration, political lobbying, board diversity and structure, as well as other variables. GFA

II,

PERSONAL POTPOURRI

Years (decades?) ago I penned a column for the now defunct ‘Journal’ (of manufactured housing) that occasionally featured a potpourri (‘mixture of anything’) collection of bon mots (‘pleasant remarks’) I collected when satisfying my voracious appetite for reading. Well, now that I’m pretty much retired, I’m finding such gems all over the place – even in long neglected files of newspaper clippings, etc… What follows here is your first opportunity to share in an eclectic reading experience.

Did you know? In white pages of older telephone directories, phonetic language was oft used to help patrons find desired listings. For many years, Indiana Bell (before it was dissolved) listed itself as the ‘Fone Company’, right before Mee Kiu Fong’s telephone listing in the directory.

Do you speak in front of audiences? Here’s what James Roosevelt’s father recommended to him: ‘Be sincere…Be brief…Be seated! And Alben W. Barkley suggests the best audience is one that is intelligent, well-educated, and a little drunk.

Ever hear the Mushroom Farm Lament? Well, here goes: “We feel we’re being kept in the dark. Occasionally someone comes around and spreads manure on us. When our heads pop up, they’re chopped off. And then we’re canned.” Quoted from Jim Lundy’s classic book, ‘Lead, Follow, or Get Out of the Way’, 1986.

Know someone in the industry or realty asset class who routinely angers, insults, and or torpedoes relationships in word or deed? Perhaps a T-shirt with this logo is appropriate:
MAY LIGHT FROM THE BRIDGES I’VE BURNED LIGHT MY WAY.

While reading the following short story, reflect on where it’s headed and who inspired it: “Call me Ishmael. Some years ago – never mind how long precisely – having little or no money in my purse, and nothing particular to interest me on shore, I thought I would sail about a little and see the watery part of the world. Hence I solemnly took to the ship in a blind effort to appease my drizzling soul. Unbeknownst to me was the fateful event this voyage would present. Having a shortage of fresh water, the men resigned themselves to not washing their hands after the moving of their bowels, causing a severe occurrence of stomach cramps and other unpleasant digestive symptoms. Perhaps if I had taken solace in the land, I would never have set foot on that cursed ship.” So, did you think of the author Herman Melville and his classic ‘Moby Dick’? Believe it or not, this reading material was prepared, years ago, and posted in rest area bathrooms along Allegheny County highways in Pennsylvania.

OK, let’s end this week’s post with this quote: ‘Old Age and Treachery will overcome Youth and Skill’ – or so read the T-shirt I wore awhile back.

Next week’s blog? Expect to read ‘A Short Course in Human Relations’, ‘Dr. Strangelove in Vietnam’ (all about the presence of nuclear weapons nearby at the time). For those of you who’ve read my autobiography, you know I was trained as an Atomic Demolitions Munitions technician (a.k.a. suicide bomber), to be activated in the event the North Vietnam Army crossed in mass over into South Vietnam.*1 and ‘How to Eat Crawdads’.

End Note.

1. ‘From SmittyAlpha6 to MHMaven’ autobiography available via www.educatemhc.com



George Allen, CPM, MHM
EducateMHC

Blog Posting # 672 @ 7 January 2022: EducateMHC

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

EducateMHC is the online national advocate, realty asset class historian, trend spotter, education resource & textbook source for land lease communities throughout North America!

To input this blog and or connect with EducateMHC, telephone (317) 888-3815, email gfa7156@aol.com and/or visit www.educatemhc.com Previous phone #s no longer connected.

Motto: ‘U Support US & WE Serve U!’ Goal: to promote HUD-Code manufactured housing and land lease communities as U.S. # 1 source of affordable attainable housing! Be MHM certified!

INTRODUCTION: Thanks for your input of late, helping me decide how to pen future postings of this blog. More suggestions and ideas? Let me know via gfa7156@aol.com

I.

2022 TO APE 2021 OR BE BETTER?

Were you one of hundreds to recently receive my ‘Expression of Appreciation & Look Forward into Year 2022’? If not, you’ll want to read the following four paragraphs to learn how our industry appears to have ended year 2021; what 2022 ‘looks like already’; and, why I’m not bullish on the land lease community real estate asset class. Here goes….

“How will year 2021 end relative to new HUD-Code housing shipments? Even though we shipped fewer new HUD-Code homes during November 2021 @ 9,069 compared to previous month of October @ 9,254*1. To date (i.e. end of November), we’ve already shipped more new homes @ 97,758 than during previous 15 years, going back to 2006 @ 117,510. But will December’s shipment total be enough to eclipse the 2006 year-end number? At this point we need only 19,752 homes shipped to do so! Hence, the speculative answer is ‘yes’! In any event, we’ll be back above the 100,000/year target total. BUT, how long will we enjoy that momentum – or will we grow – or slip backwards again?”

“2022? While we’re ‘on a roll’ shipment-wise right now, future performance depends on resolution of alleged supply chain issues, controlling arbitrary price increases by housing manufacturers, and if/when we finally bring reason and resolution to our perennial chattel capital (i.e. home-only) financing challenges. After all, it’s been 13+/- years since we lost easy access to this type financing, e.g. 1998 = 372,943 new homes shipped, compared to 2009 and only 48,789 new homes shipped during the latter year – our industry’s nadir year.”

“I want to be bullish about the land lease community sector of the manufactured housing industry, but am not! Why? In my opinion, ‘consolidation’ of sole proprietor-owned communities into one or another of 500+/- property portfolios has generally run amuck. Property sale prices, for the most part, are driven by greed (on the part of ‘sellers’), and willingness, on the part of ‘buyers’ to greatly increase site rents following ‘closing’. At the very least, we’ve seen the rise of tenant activism on a near national scale; something we’ve not dealt with before. And how are we going to convince prospective homebuyers/site lessees to buy new homes within land lease communities when site rent is no longer a third, but fully half the amount – or more, they’d pay for a conventional, non-subsidized 3BR2B apartment unit in the same local housing market? I fear we may well see a ‘shaking out’ among hedge fund investors who’ve entered the realty asset class during the past five years.”

“So, where do we go from here? Again personally, I yearn for far more effective national advocacy than we suffer now! At the very least, a salaried executive at the Manufactured Housing Institute (‘MHI’) and its’ National Communities Council (‘NCC’) division should be solely-tasked with day to day administration and representation of land lease communities nationwide – just like it used to be, from January 1996 to pre-2010. In addition, endorse professional property management among on-site and regional managers by insisting on ‘education & certification’ in a meaningful manner! This by dint of Accredited Resident Manager (‘ARM’) and Certified Property Manager (‘CPM’) member programs via the Institute of Real Estate Management (‘IREM’), OR some other credible in-person (NOT online) training program! This obvious professional property management shortfall continues to be the Achilles’ heel of land lease community management and ownership nationwide.”*2

End Notes.

1. The new HUD-Code housing shipment totals as reported by the Institute of Building Technology & Safety (‘IBTS’), HUD, MHARR, and EducateMHC.

2. You serious about providing the property management tools on-site and regional managers need to do their jobs right? Every property should have a copy of ‘Community Operations in the Manufactured Housing Industry’ – available via www.educatemhc.com

DID YOU KNOW?

Biloxi Manufactured Housing Show to be held from Monday, 28 March, through Thursday, 31 March, at the IP Casino Resort and Spa in Biloxi, Mississippi. This trade show is successor to the popular Tunica, Mississippi MHShow. For more information: www.biloxihomeshow.com

MHI’s Congress & Expo is scheduled for Monday, 11 April thru Thursday, 14 April, at the Rosen Shingle Creek Resort. For more information: www.manufacturedhousing.org

Stephen Braun, co-CEO, has retired from Hometown America. For corporate contacts, email either Ken Kravenas via KKKRavenas@HometownAmerica.net for operations-related matters; or Greg Lynch via GLynch@HometownAmerica.net for all other matters. Stephen’s leaving has been so quiet, it reminds me of when Barry McCabe, another Hometown alum, faded from the scene a decade ago. Hometown America was founded by Randy Rowe (presently head of Green Courte Partners) in 1997, and today owns 66 land lease communities in a dozen states – including the well-known SaddleBrook Farms in Grayslake, IL.

You a fan of the popular TV show series NCIS? I am, and one of my Christmas stocking presents from Carolyn was a copy of the magazine GIBBS FOREVER. Best part? Finally, I have a complete list of what show fans know as Gibbs’ Rules. There’re 34 of them in all. A few gems appear to apply to the business world: #3 Never be unreachable. #5 You don’t waste good. #11 When the job is done, walk away. #15 Always work as a team. #18 It’s better to seek forgiveness than ask permission. #28 When you need help, ask. #51 Sometimes you’re wrong. And a personal favorite = #23. Never mess with a Marine’s coffee if you want to live!

I’m old enough to remember the influence and death of social and political activist Saul Alinsky in mid-1972. He authored ‘Rules for Radicals, Reveille for Radicals’ – a simplification of Vladimir Lenin’s original scheme for world conquest by communism, under Russian rule. He wrote there are eight levels of control that must be achieved before one is able to create a (new) social state. They are:

1. Healthcare. Control healthcare and you control the people (Pandemic anyone?)

2. Poverty. Increase the poverty level as high as possible; poor people are easier to control and will not fight back if you are providing everything for them to live (Think illegal immigrants)

3. Debt. Increase the debt to an unsustainable level. That way one is able to increase taxes, and this will produce more poverty. (Present national debt level sustainable?)

4. Gun Control. Remove the ability of citizens to defend themselves from the Government. That way one is able to create a police state. (Gotta love the second amendment!)

5. Welfare. Take control of every aspect of citizens’ lives (Food, Housing, & Income)

6. Education. Take control of what people read and listen to – take control of what children learn in school. (Errant social media platforms, Critical Race Theory, etc.)

7. Religion. Remove belief in God from the government and schools. (No prayer in schools)

8. Class Warfare. Divide the people into the wealthy and the poor. This will cause more discontent and it will be easier to tax the wealthy with the support of the poor.

Well, there you have it, a veritable blueprint on how to convert a democracy (republic) into a totalitarian state. Now that you know how it’s done, do your part to prevent it from happening!

George Allen, CPM, MHM
EducateMHC

Blog Posting # 671 @ 31 December 2021: EducateMHC

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

EducateMHC is the online national advocate, asset class historian, data researcher, education resource & communication media for all land lease communities throughout North America!’

To input this blog and or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email: gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U!’ Goal: to promote HUD-Code manufactured housing and land lease communities as U.S. # 1 source of affordable attainable housing! Attend MHM class!

INTRODUCTION: This week’s blog materialized as I replied to the usual daily collection of email messages from friends and business associates throughout the manufactured housing industry and among land lease communities. Decided it might be interesting to you to read about what’s been going on around here for the past week or so. So….

I.

NEW YEARS EVE MUSINGS

First off, a sincere Thank You to many ‘friends in the MHBusiness’ who sent Carolyn and me holiday gift packages of fresh Florida citrus fruit, genuine Lebanese ‘extra virgin’ olive oil – and other Mediterranean treats, an equally genuine YETI – insulated travel flask, and such a variety of fudge, sausage, cheese, and other goodies!

Especially appreciated the manufactured housing-themed greeting cards from MHI and Monroe & Giordano. And the family photographs of the DeMarco families at Security Mortgage in NY.

I exhibited symptoms of Covid-19 on Saturday, 18 December, so checked-in to a local hospital, where the diagnosis was confirmed. Kept me there most of the day, until they infused me with the same pharmaceutical administered to President Trump awhile back. Told me I’d feel like new in 12 hours – and I did. But have been quarantined at home with Carolyn until 28 December, when I tested ‘negative’ for the virus. This meant we canceled a large family dinner Christmas Eve, and spent the holiday alone at home – our 58th Christmas together, except for my year in Vietnam.

Sad news. Learned from Rick Robinson of Bill Matchneer’s untimely death on Christmas day. Many of you will remember him from his days as head of HUD’s manufactured housing division. Sorry, but have no further details.

Have you seen the list of manufactured housing industry notables who comprise the Class of 2022 Inductees into the prestigious RV/MH Hall of Fame in Elkhart, IN.? They are Eugene Landy of real estate investment trust UMH Properties in NJ; Tim Williams of 21st Mortgage in TN; Harry Karsten of Karsten Homes in CA; Raylen Gritton a MHRetailer in CA; and David Carter from FL. The Class of 2022 will be officially inducted at the annual Hall of Fame banquet on Monday, 15 August 2022. For more information, phone (574) 293-2344. Plan now to attend; anyone who’s anyone in MH will be present for the festivities!

II.

THE B-ATTITUDES OF JOURNALISM

John W. Fountain is an award-winning columnist, journalist, and author, working out of Chicago, IL. In 2006 he delivered the Samuel E. Cornish memorial Lecture at the World Journalism Institute in Atlanta, GA. The lecture was titled ‘Mightier Than the Sword’

Within the presentation Fountain introduces his B-Attitudes of Journalism. While somewhat reminiscent of my personal ‘writing bromide’, the ABC3 Rule of Good Communication, Fountain digs much deeper.

First, the ABC3 Rule of Good Communication. Be Accurate, Be Brief, Be Clear, Concise & Complete! – when communicating in person and in print!

Now onto Fountain’s B-Attitudes of Journalism.

Be accurate. A journalist never sacrifices fact for details.

Be honest.. To the craft, to the reader, to your editors.

Be professional. Be on time; do quality work.

Build on good mechanics. Master the fundamentals of journalism.

Be consistent and diligent with writing and reporting. Regularly practice the craft. Diligently work in school to learn how to do good journalism.

Be a reader. Good writers are Good readers.

Be thick-skinned. Learn to take criticism and grow.

Be confident. As a journalist, there are hills and valleys. Don’t judge your worth by a difficult valley experience.

Build a network of support. Editors, colleagues, non-journalist friends and family can lend perspective and balance.

Be patient. Write and rewrite, understanding that good writing is a process.

Bring your perspective. Your uniqueness will generate unique stories and enable you to tell a story as only you can.

Be excellent. One can’t argue with excellence!

Believe. In the story, in the power of journalism, in your ability to make a difference.

BE. Rather than talking who you are, just BE who you are.

I can think of many a journalist who should be reading and practicing those Be Attitudes!

George Allen, CPM, MHM

Blog Posting # 670 @ 24 December 2021: EducateMHC

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

EducateMHC is the online national advocate, asset class historian, data researcher, education resource & communication media for all land lease communities throughout North America!

To input this blog and or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email: gfa7156@aol.com & visit www.eduatemhc.com

Motto: ‘U support US & WE Serve U!’ Goal: to promote HUD-Code manufactured housing and land lease communities as U.S. # 1 source of affordable attainable housing! Attend MHM class!

INTRODUCTION: As we enter this holiday season and prepare to begin a new year, be vigilant of those influences helpful to your line of work within manufactured housing and land lease communities. Here’s just two matters for you to read and ponder: Why do some folk insist on pontificating info they know little about; and, are you EMP-prepared? George Allen

I.

BEWARE FALSE FACTS!

It’s happening already; businessmen and women who should know better, are trafficking in false information! Just this past week on FACEBOOK, in a list of five questions purporting to explain ‘Why land lease communities are disappearing’ (Actually, the writer used a past term for the realty asset class, compounding the false information problem), the bold but inaccurate statement was put forth: ‘estimate only ten land lease communities have been developed during the past two decades’. Nothing could be further from the truth! There have been dozens of new communities developed throughout the U.S., during the past decade. Just ask landscape architect consultant Don Westphal, in MI, for a list of just his developments and expansions. And talk to the REITs (real estate investment trusts) about communities they’re developing in TX, FL, and elsewhere. Ask Ed Zeman and Jamie Dougherty about their communities in MI.

To me, this sudden appearance of false information belies a credibility problem besetting the manufactured housing industry and land lease community real estate asset class. With so many industry and property veterans retiring this past year, the internet is ripe for exploitation by individuals, many of whom are new to MH and communities, to seize the moment and put forth their theories and thoughts as to what what’s happening in their realms of experience and investment.

So, be alert to what you read and believe.

II.

ARE YOU EMP-PREPARED?

For a moment, stop and consider the dire consequences of being totally without electric power to light and heat one’s home, operate vehicles, and communicate via telephone, radio, TV and otherwise! Frankly, I’d not given the matter any thought until I read a novel recommended by a junior executive friend at the Federal Housing Finance Agency in Washington, DC. The book? ONE SECOND AFTER, by William R. Forstchen (Available for $10 from Amazon.com). There are two sequels in the EMP-centered triad of novels.

Here’s what I learned. Complete chaos will reign following an electromagnetic pulse, until individuals grasp what is going on and work to ameliorate the severe consequences of no longer having power to do anything beyond lighting a campfire, drinking water from a stream, and gathering together for warmth and protection. That’s the message, clearly set forth in the novel – which follows the lives of individuals in a small college town in western North Carolina. What replaces dollars and coinage as valuable legal tender? Bullets! Bullets needed to hunt local wildlife; and eventually, protect lives.

I’d allowed this ‘wakeup call’ message to fade somewhat from memory during ensuing years – until I read a recent email message from stormrecovery@srp24.com earlier this month. Here’s an edited portion of a paragraph labeled ‘Electromagnetic Pulse’:

“Israel and Iran are preparing for war. China is planning to annex Taiwan. Russia is amassing troops to annex the rest of Ukraine. China and Russia are working in cooperation and will likely strike simultaneously. To prevent the U.S. from aiding each of its’ allies, it is likely China will encourage North Korea to deorbit two satellites down to an altitude of 140 km above the earth. The President’s EMP Commission states that both satellites are likely carrying nuclear weapons. By detonating the nuclear weapons at that altitude, the gamma rays from the nuclear explosion will interact with the edge of the atmosphere and generate a very strong electromagnetic pulse (‘EMP’). The pulse is about 5,000 times stronger than a cell tower. It encompasses the AM and FM radio bands and travels at the speed of light. An EMP can cause a voltage spike of 50,000 volts or more in power lines and metal cables, and generate several thousand amps of current. The spike is a thousand times faster than lightning. Conventional lightning surge arrestors are too slow to stop it. Any electronic equipment that is not EMP-protected, including backup generators and vehicles, will no longer function. An EMP could cause a grid outage lasting a year of more.”

Is that scary enough for you? Is your home and business, as well as personal and corporate vehicles EMP-protected? Probably not. Even though some military vehicles are, many are not. Now is time to begin preparing for the consequences of an EMP strike in the atmosphere above our nation!

But what to do? Suggest you google ‘EMP-preparedness’. There you’ll find many resources containing information as to steps to take to be better prepared for such an emergency if/when it occurs. You decide what to do now and what to consider later.

Blog Posting # 669 @ 17 December 2021: EducateMHC

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

EducateMHC is the online national advocate, asset class historian, data researcher, education resource & communication media for all land lease communities throughout North America!

To input this blog and or affiliate with EducateMHC, telephone Official MHIndustry HOHTLINE: (877) MFD-HSNG or 633-4764. Also email: gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WWE Serve U! Goal: to promote HUD-Code manufactured housing and land lease communities as U.S. # 1 source of affordable attainable housing! Attend MHM class!

INTRODUCTION: This week, the most important ‘industry message’ appears as Part II, ‘Revisit DOE Proposal Crisis!’ – a continuation of last week’s warning from MHARR relative to MHs ‘twin crises’. As you read it, keep in mind: ‘If you’re not part of the solution, you’re surely part of the problem!’ So, get on the ball and work with MHARR, MHI, and others to fight DOE’s proposed rule relative to energy conservation mandates for manufactured housing! Part I? Well if you’re getting to be ‘long in the tooth’ (i.e. older, elderly) here’s human potential encouragement!

I.

YOU OLD? READ THIS!

Here’s clear evidence human potential does not cease at some arbitrary age. Following paragraph is quoted from the Handbook to God’s Promises, by Kenneth Boa & William Kruidenier. The 707 pages book was published during year 2020 via reflections.org.

“Antonio Stradivari (1644-1737), also known as Stradivarius, fashioned two of his most famous violins, the ‘Habeneck’ and the ‘Muntz’, in his early 90s. Noah Webster (1758-1843) published his two-volume American Dictionary of the English Language, at age 70. Galileo (1564-1642) published his masterpiece, Dialogues Concerning Two New Sciences, at age 74. Frank Lloyd Wright (1867-1959) designed the Guggenheim Museum in New York City at age 91. At age 84, Agatha Christie (1890-1976) oversaw production of the movie Murder on the Orient Express, based on her novel of the same name. Golda Meir (1898-1978) served as prime minister of Israel from age 70 to age 76. Peter F. Drucker (1909-2003) wrote Managing in Turbulent Times at age 71 and Management Challenges for the 21st Century, at age 89.” P.302

Know what? That sage observation tells me I was right to pen my autobiography, From SmittyAlpha6 to MHMaven, last year, my 75th year. Hmm. Wonder what project to take on before I reach 80?*1

How ‘bout you? Getting along in years? If so, NOW is time to begin penning short memoirs describing personal experiences over past years. Then collect and meld them into your autobiography to share with family members, friends, and business acquaintances.

And, to help you along – if you don’t already have a copy, let me know you’d like a FREE booklet titled, Who Will Preserve Your Legacy. Answer: You! Reach me via gfa7156@aol.com
Be sure to include your preferred postal mailing address.

II.

REVISIT DOE PROPOSAL CRISIS!

Last week’s blog posting introduced you to ‘MH’s Twin Crises’ as viewed by the Manufactured Housing Association of Regulatory Reform (‘MHARR’). Well, I was so motivated by Mark Weiss’s description of this thinly veiled attempt to KILL the manufactured housing industry as affordable housing, that I prepared – and will soon be sending letters to 11 state attorneys general and ten state MH association directors identified in the MHARR communique of 9 December 2021. Suggest you read what I’ve penned – following, and consider doing the same!

TO: Appropriate party

FROM: George Allen, CPM, MHM, author of SWAN SONG, a history of land lease communities & Official Record of Manufactured Housing Shipments since 1955.*1

SUBJ: DOE proposed rule relative to energy conservation mandates for manufactured housing

HUD-Code manufactured homes, since 1976, have been fabricated to incur energy costs lower
than site-built on a whole-home basis; at the same time ensuring purchase price affordability
for home buyers at all income levels! Hence, the Department of Energy (‘DOE’) proposed rule
relative to energy conservation mandates for manufactured homes is redundant.

Furthermore, the DOE proposed rule stresses speculative ‘life-cycle’ energy cost savings,
ignoring the high purchase price impact said rule would have on prospective homebuyers’
purchase (price) of mainstream manufactured homes!

Key points? HUD-Code manufactured homes are already more energy efficient than stick-built
homes. And spreading the cost of DOE rule implementation in new manufactured homes out
over years is moot if it causes the home buying market to be unable to afford heretofore ‘most
affordable housing alternative in the U.S.’

So please withdraw your support of DOE’s unnecessary and ill-conceived proposed new energy
standard for manufactured housing.

End Note.

1. Both books available for purchase at www.educatemhc.com Maybe even purchase and give copies as holiday gifts this month!

George Allen, CPM, MHM
EducateMHC

Blog Posting # 668 @ 10 December 2021: EducateMHC

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

EducateMHC is the online national advocate, asset class historian, data researcher, education resource & communication media for all land lease communities throughout North America!

To input this blog and or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email: gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U! Goal: to promote HUD-Code manufactured housing and land lease communities as U.S. # 1 source of affordable attainable housing! Attend MHM class!

INTRODUCTION: According to MHARR the manufactured housing industry is faced, today, with twin crises. And some might add ‘a third’ in light of the fact our industry appears to be incapable of reporting a consistent number of new HUD-Code homes shipped monthly.

I.

MH’s TWIN CRISES

As observed and described by the Manufactured Housing Association for Regulatory Reform in its’ November 2021 communique; actually a Q&A discussion between president & CEO Mark Weiss and an online trade publication.

Did you even know manufactured housing is faced with twin crises? Well here they are:

CRISIS # 1. The energy matter. Department of Energy (‘DOE’) proposed rule for manufactured housing was once blocked, but then revived in 2014, only to be withdrawn near the end of the Obama administration. Since then there’s been back-and-forth legal maneuverings, culminating in a requirement to publish a proposed standard in 2021, to be adopted as a final standard in 2022. Other related factors? ‘Climate change’ interest on the part of the current administration; failure of the two GSEs to implement their ‘Duty to Serve’ (‘DTS’) plans relative to chattel loans; and, GNMA’s ’10-10’ rule that’s collapsed FHA Title I lending. Result? “…a devastating impact on mainstream manufactured housing….” MW

CRISIS # 2. No post-production trade advocate. “…the industry does not have an independent national post-production representative organization to fight for, advance, and implement full and equal inclusion of manufactured homes in federal government housing largess.” (lightly edited) About which MHAARR continues: “MHARR is not – and will not become – a post-production association.” Understood. But it does bring to mind proverbial truism: ‘If you’re not part of the solution, you’re part of the problem!’ And I do understand MHARR’s frustration about this matter, but from a different perspective. On 26 October 1993, during a meeting in Dallas, TX. land lease community portfolio owners/operators drafted a Mission Statement and Strategic Objectives for what they hoped would be a ‘post-production association’. Well, long story short, these 19 executives and the Manufactured Housing Institute (‘MHI’) launched the National Communities Council (‘NCC”) on 1 January 1996. While it got off to an enthusiastic start, under the leadership of Jim Ayotte, CAE, it didn’t take long for cronyism and political upmanship to prevail. And while the NCC is a division within MHI today, it has not – in my opinion – come anywhere near being the post-production association envisioned and needed today.*1

So, where to go from here? That depends on how serious you feel these twin crises are for the manufactured housing industry and land lease communities nationwide. In the first instance, do as I did in years past, make it a point to attend and participate in DOE public hearings on the proposed rules. Second; well, that depends on how content you are with attending one well-attended Leadership Forum, sponsored by the NCC each year, or whether you too believe there should be a salaried MHI executive actively leading the division in advocating for professional property management, fair treatment of homeowners/site lessees, and more.

End Note.
1. For more information on this subject, read The First 20 Years, penned by the late Bruce Savage, former communications executive of MHI. Available via www.educatemhc.com

II.

9,254 VERSUS 9,247

Well, I guess this leopard will not, or cannot, change its’ spots – as the bromide goes. The first of the two numbers shown above, ‘9,254’ is how many new HUD-Code homes the Institute for Business Technology & Safety (‘IBTS’) says were shipped during the month of October 2021. IBTS is HUD’s official contractor for ‘keeping score’ of new HUD-Code homes shipped monthly. The second number, ‘9,247’ is a different number of new HUD-Code homes shipped, as reported by the Manufactured Housing Institute (‘MHI’).

What’s significant about this difference in ‘the number of new HUD-Code homes shipped’ is that during the previous two months, August & September, ALL reporting entities: IBTS, HUD, MHARR, MHI, & EducateMHC announced the very same shipment totals! But now MHI has reverted back to adjusting the industry’s official total by the number of Destination Pending units recorded by IBTS. Go figure.

George Allen, CPM, MHM

Blog Posting # 667 @ 3 December 2021: EducateMHC

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

EducateMHC is the online national advocate, asset class historian, data researcher, education resource & communication media for all land lease communities throughout North America!

To input this blog, and or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U! Goal: to promote HUD-Code manufactured housing and land lease communities as U.S. # 1 source of affordable attainable housing! Attend MHM class!

INTRODUCTION: We’ve all heard the idiom (‘a form of expression’) to ‘not know any better’. Which is to say, someone does ‘not have the knowledge…to make an informed decision.’ Well, this is where today’s blog posting begins and ends. In summary, while HUD-Code manufactured housing IS the Solution to the Middle Housing Market Crisis in the U.S. today, home builders and realty developers are generally unaware how to bring this ready resource (housing) and need (shortage) together in a working, ongoing, positive fashion! Read on…

I.

SOLUTION TO MIDDLE HOUSING MARKET CRISIS

Manufactured Housing has been, and continues to be, The Solution to the affordable housing supply crisis in the U.S. today; a crisis a.k.a. (also known as) ‘the right kind of middle housing market solution’, i.e. affordable factory-built housing sited within land lease communities on rental homesites, and or on privately-owned scattered building sites within and outside platted subdivisions!*1

What are we talking about here? Well, during late November, almost simultaneously, two real estate investment-related trade publications (neither with any connection whatsoever to manufactured housing and land lease communities) published informative and insightful articles on this timely housing topic; titled:

‘Is Single-Family Build-to-Rent a True Missing Middle (housing market) Solution?’ Subtitled: ‘The model quickly delivers the right kind of housing….’ P.24 of Multifamily Executive magazine.
&
‘Housing Market Trends Fuel Single-family Home Rentals’, i.e. “…the star of the real estate show today (2021-2022) is the build-to-rent space.’ Alex Veiga writing for the Associated Press.

Well, as manufactured housing executives and land lease community owners/operators well know, the industry and realty asset class, ‘for decades’ has been active, in and out of the single-family home rental business! Rental manufactured homes were commonplace in (then) manufactured home communities in the 1970s, until consolidation prevailed and it became easier to sell a ‘community’ occupied by tenant-owned homes, not rental units. And, it’s also well known that manufactured homes have oft been purchased for placement on privately-owned realty (e.g. farms), to be rented out to family members and transient labor. Today or more accurately since year 2010 +/-, manufactured housing is back in the rental home business, with new HUD-Code homes routinely sold into land lease communities and used as rental units. Here, think Sun Communities, RHP Properties, YES! Communities and others. For that matter, quoting from the 32nd (& final) ALLEN REPORT, circa 2021, “26 of 92 respondents (to this survey) confirm the presence of 26,528 rental homes on-site in their communities, for an average of 1,020 rental homes per (reporting) portfolio.”

Here’s the enigma (‘riddle, anything puzzling’): Given the widely recognized need for affordable single-family housing throughout the U.S. today, and the seeming solution being new rental units (a.k.a. ‘build to rent homes’), why are developers of new housing tracts not flocking to factory-built housing in general, HUD-Code manufactured housing in particular, especially the relatively recent CrossMod™ design?

Before I proffer an answer to that tripartite question, let’s take a look at what non-manufactured housing real estate observers and pundits are writing and saying on the matter.

Today, only 5.4 percent of the single-family rental housing national market is cornered by REITs and investors (not Mom & Pop investors – who account for an even larger market share of ‘rentals’) who’re focused on renting single-family homes they’ve acquired. They are now (maybe) being joined by builders eyeing this entry market to affordable housing, having built 47,000 new homes during the past four quarters.

Here’re some miscellaneous points from the aforementioned trade publication articles:

“The missing middle – defined here as households who earn between 80% & 120% of the area median income (‘AMI’), occupies a difficult position in the housing market. In many areas, households at this level do not qualify for subsidized housing, cannot afford the housing options in a given (local housing) market, and have very little in the way of smaller-scale housing options from which to choose.” P.24. This comment relates to the first article title quoted earlier.

What’s causing this inability of prospective homebuyers and renters to find affordable housing? “…a perfect storm of causes, among them high land prices, building material prices, and regulatory considerations that drive builders toward larger and more elaborate homes in order to justify the cost of a purchase.” P.24.

So, “…single-family build-to-rent has emerged as an asset class that delivers precisely what this (middle) group wants. Scalable built-to-rent models provide what developers are rarely incentivized to build – small-scale housing, attached or detached, with lower barriers to access than the single-family for-sale market.” P.24. And who routinely designs and fabricates small-scale housing to a preemptive national building code? HUD-Code manufactured housing!

OK, back to ‘an answer to that question’ about developers not flocking to purchase and use HUD-Code manufactured housing as single-family rental housing. What follows is my opinion, honed during 40+ years as an observer of manufactured housing and land lease community owner/operator:

• To begin with, developers simply do not know who we are, nor do they understand how and why HUD-Code manufactured housing is so affordable, and how it answers today’s housing needs – especially in the middle market.

• The business mindsets characteristic of site-built housing and manufactured housing pros are different, as different as learning to fly a single engine airplane versus a commercial airliner. Manufactured housing execs are hyper-sensitive to every cost factor that increases product cost. Site-builders, on the other hand, oft seem happy to include cost increase factors, often faddish, that lead to ‘bigger box = bigger bucks’ home sale prices.

• Then there are the conceptual and practical differences between building custom homes stick-by-stick, by dint of employing cost saving principles of inventory control, mass production, in—plant climate control, and use of skilled but casual labor, throughout the building process.

Bottom line? We have never been very good, as an industry or realty asset class, at marketing ourselves across housing and community types and lines. Folk simply do not know about us; and when they do, they certainly do not understand what makes us tick. Until that changes, we will remain, sad to say, ‘dead in the water’ as a comprehensive housing provider, especially to the underserved middle market!

Consequence? Again, there’s a major need for our housing type and communities on the national scene these days, and it will continue to be unmet until we, including our national advocates, educate site-builders and developers as to why our product perfectly fills their need for affordable, single-family rental housing!

End Notes.

1. Right up front, let’s agree on the official definition of affordable housing. “Housing is Affordable when an individual or household’s Annual Gross Income (‘AGI’), or local housing market’s Area Median Income (‘AMI’) – identified by postal zip code and available online via zipho.com, can lease a conventional apartment and or buy a home in this local housing market, using no more than 30 percent of said AGI, or AMI, for shelter and related household (utility) expenses. For example; a $50,000 AGI/AMI X .3 Housing Expense Factor or HEF =$15,000/year or $1,250/month, available for rent or mortgage PITI (principal, interest, taxes, insurance) and household expenses.” Note. Not all lenders include household expenses in this calculation.” Quoted from EducateMHC’s Resource Document titled: ‘Solving Our Nation’s (Lack of) Affordable Housing Crisis, with Factory-built Housing & Land Lease Communities’, by George Allen, CPM, and MHM.

George Allen, CPM™Emeritus, MHM™Master
EducateMHC
Box # 47024, Indianapolis, IN. 46247

(317) 881-3815 & gfa7156@aol.com

Blog Posting # 666 @ 24 November 2021: EducateMHC

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

EducateMHC is the online national advocate, asset class historian, data researcher, education resource & communication media for all land lease communities throughout North America!

To input this blog and or affiliate with EducateMHC, telephone Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. Also email: gfa7156@aol.com & visit www.educatemhc.com

Motto: ‘U Support US & WE Serve U! Goal: to promote HUD-Code manufactured housing and land lease communities as U.S. # 1 source of affordable attainable housing! Attend MHM class!

INTRODUCTION: History, Conundrum, and Books are topics of Parts I, II & III in this weekly blog posting. Bet you didn’t know this about the early days of MHI (when it was MHMA). Or that HUD-Code housing manufacturers appear to be thriving during these difficult mid-pandemic times. And Part III can help you with your holiday gift giving during December.

I.

DANNY D. GHORBANI

During fall 1967, Danny was contacted by a ‘head hunter’ who wanted to talk to him about the possibility of a position with an organization representing the mobile home industry. His initial reaction? Danny “… didn’t know the Mobile Oil Company was involved with housing.” He was that naïve about the industry that came to appreciate him as their ‘Watchdog of manufactured housing’ in Washington, DC. And there’s more to that story.

In ‘The History of the (Iowa) Manufactured Housing Association 50th anniversary book’ of memories, Danny goes on to describe how the manufactured housing’ industry was booming at the time and attempting to shed its’ mobile home image. Specifically,

“Production had grown from more than 90,000 homes in 1961 to almost a quarter million homes in 1967. The industry’s only marketing firm (i.e. Elrick & Lavidge, Inc.) predicted the growth would continue at a rapid rate, reaching 600,000 homes per year by the early 70s. They were right on target. Growth reached 560,000 homes in 1973.” P.36 The actual total was 579,940 new ‘mobile homes’ shipped.

Danny, in the article titled ‘Industry Veteran Looks at the Early Years’, goes on to tell us:

“The industry’s unprecedented, if not almost unbelievable growth, was brought about, in large part, by a succession of industry giants such as F.L. Cappaert, James Redman, Edward Hussey, Sr., and Arthur J. Decio, (the latter) took the helm as chairman of MHMA (Mobile Homes Manufacturers Association).” P.36. FYI: Cappaert was inducted into the RV/MH Hall of Fame in 1975, James Redman in 1991, Ed Hussey, Sr. in 1995, and Art Decio in 1975.

Furthermore, and due to architectural and engineering firms having little interest in land development projects, which to them, represented an extension of ‘the trailer industry’,

“…the national association created its’ own in-house team of professional engineers and architects to prepare a turnkey operation which included, among other things, site planning, zoning, market and feasibility studies, design and engineering packets, and related cost-estimates which were provided to potential developers…at cost. With MHMA providing this service, all the developer had to do now, if he/she so chose, was to hire his or her own contractor to build the community and a local engineer to supervise the work.” P. 37

Danny Ghorbani was…”hired to serve as the assistant to Herbert Behrend, who headed this operation at MHMA. With an in-house staff of 12 people and on-call group of more than 20 professional consultants, our operation quickly was utilized by developers for more than 200,000 (rental home) sites in four years. The operation became so successful that regular architectural and engineering firms began getting heavily involved with mobile home community development, thus enabling the MHMA, after it achieved its’ goal, to dissolve the operation in 1971.” P.37. Interestingly, Danny was not inducted into the RV/MH Hall of Fame until 2004; and the late Herbert Behrend, his boss at MHMA, continues to await selection and induction – showing our industry’s system of honoring its’ pioneers is not yet perfect!

In my opinion, this early segment is an important part of manufactured housing and land lease community history. However, and for the most part, it’s already been lost to businessmen and women who’ve come aboard the industry and realty asset class since the turn of this century! So yes, there was a time in our history when housing manufacturers realized, to grow their businesses, they had to help ensure plenty of locations (i.e. communities) in which to install their product. Hence the heyday of (then) mobile home park development across the U.S.

And this ‘begs the question’; ‘Is there more that HUD-Code housing manufacturers should be, could be, doing today (like they did during the 1960s & 70s), to encourage raw land development into land lease communities containing rental homesites?

II.

WHEN COST & PRICE INCREASES = HIGHER STOCK PRICES

According to EducateMHC’s ‘MHShipment Volume for September & Stock Market Report for 3 November 2021’, the manufactured housing & land lease community Composite Stock Index or CSI, hit a new record high of $812.23; up from $762.97 the month before.

Recent communiques from one or another of the Big 3-C HUD-Code housing manufacturers informs customers (i.e. land lease communities, independent – street – MHRetailers, & possibly, ‘company stores’), how lumber, resin-based goods, steel and other metals, and imported products (delayed by supply chain issues enroute),lead to “base prices will be increasing in the December pricing period.”

The aforementioned CSI is comprised of the following corporate stock prices on 3 November, and other factors.

Skyline Champion @ $72.42
Cavco Industries @ $258.89
Legacy Housing Corporation @ $18.88
Nobility Homes @ $32.38
Berkshire Hathaway
Equity Lifestyle (REIT) @ $85.24
Sun Communities (REIT) @ $196.26
UMH Properties (REIT) @ $24.26
Flagship Communities @ $20.65
Manufactured Housing Properties @ $3.25

So post production sectors of the manufactured housing industry are stuck in the middle of a conundrum (i.e. ‘hard question’); that is, having to pay more for product (e.g. new HUD-Code homes), suffer long delivery waiting times, but not participate in increased profitability evidently enjoyed by housing manufacturers.

III.

Looking for Christmas gifts for colleagues and or on-site property managers in land lease communities? Purchase and send them either SWAN SONG (‘History of LLCommunities & Official List of Annual Shipment Totals from 1955 to present day’) or my autobiography, ‘From SmittyAlpha6 to MHMaven’. Order via www.educatemhc.com

George Allen, CPM™Emeritus, MHM™Master
EducateMHC