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

February 23, 2013

What LLLCommunity Owners Really Want!

Filed under: Uncategorized — George Allen @ 9:39 am

Blog # 234 Copyright 2013 24 February 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

What Land Lease Lifestyle Community Owners Really Want!

The most insensitive thing land lease lifestyle community asset class’ elected leaders can do, is decide ‘on their own’ what their peers need and want – without soliciting their input, regarding contemporary issues and trends; and most important, what’s required to help them run their unique income – producing properties well!

What follows here, are responses from two separate, recent surveys of more than 600 owners/operators of land lease lifestyle communities and property portfolios. The sources? 24th annual ALLEN REPORT research, and POWER Networking Luncheon at the Louisville MHShow during January 2013.


A detailed summary of the 14 MHIndustry & LLLCommunity issues identified by property owners/operators, during the research phase (Fall of 2012) of preparing the 24th annual ALLEN REPORT®, will be published as a signature Series Resource Document®, in the March 2013 issue of the Allen Letter professional journal. In the meantime, here’re the four major categories of issues, covering said 14 different topics:

• For a least the fifth year in a row, land lease lifestyle community owners and operators identified the ‘lack of new and resale home finance programs’ (Specifically, the inability of would be homebuyers to access chattel capital, due to low credit scores, bruised credit, etc.), as well as continued lack of access to government – insured finance programs, on – site, as perennial bugaboos.

• Hand in glove with the first ‘industry issue’, is the continually growing number of home finance regulatory measures and agencies (e.g. S.A.F.E. Act, Dodd – Frank legislation, CFPB, and more) requiring compliance by those selling/financing homes. And how many LLLCommunity owners/operators now embrace creative alternative means of financing and moving new move – ins into their property(ies)

• Not surprisingly, there’s the ongoing challenge to grow and maintain physical and economic occupancy within land lease lifestyle communities, as the third most prevalent issue among the owners/operators involved in this business model.

• And finally, a three way tie among 1) inability to find good quality, near new homes, to move on – site and sell or rent; 2) rising cost of new manufactured homes, including cost of site additions; and 3) government interference in business via rent controls, and other landlord-tenant measures.

Did you notice, while reading the above list, that while all issues’ are germane to the land lease lifestyle community realty asset class, they’re especially critical to the small to mid – sized owners/operators (i.e. one property owners and portfolio ‘players’ with maybe a half dozen or so smaller to mid – sized LLLCommunities). These being the folk who lack ‘economy of scale’ resources, mainly dollars, to deal with said issues internally, unlike the largest of the portfolio owners/operators, who’re routinely doing just that.

In any event, and with the above six MHIndustry & LLLCommunity ‘issues’ in mind, here’re practical recommendations as to how national leaders at 1) MHI’s National Communities Council (‘NCC’) division, and the 2) Manufactured Home Community Owners of America (‘MHCO’), can Best Serve land lease lifestyle community owner/operators nationwide:

• Once and for all, identify ALL existing, viable home finance programs in effect throughout the U.S. today, from identifying independent third party chattel capital firms (e.g. Commonly referred to as the ‘Big Four + 1’, maybe soon to be the ‘Big Five + 1’ *1); then, the various forms of ‘self – finance’ (e.g. formation of ‘captive finance’ entities), including the lease – option, even the popular contemporary practice of renting manufactured homes on – site; and more! There’s already one such chart in circulation, titled ‘Seller Finance Solutions’ – distributed as a lagniappe, in the January 2013 issue of the Allen Letter professional journal, along with the 24th annual ALLEN REPORT®. Did you get a copy of both documents? If not, the chart is available ‘for the asking’, by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. One thing that hasn’t happened yet, is the formation of a Task Force, comprised of LLLCommunity owners/operators to explore the exciting possibility (reality?) of using private investors via P2P (Peer to Peer) and B2P (Business to Peer), a.k.a. ‘crowd funding’, to finance LLLCommunity owners/operators’ acquisition of new manufactured homes for placement on – site in their properties. For LLLCommunity owners/operators not yet familiar with, or using this option, know Spencer Roane, MHM®, has been using this approach successfully, for more than a decade, and brought it to our asset class two years ago. Reach him via

• Home finance regulatory measures and agencies. Here, an easy to read, periodically updated compendium of appropriate information, is sorely needed. PMN Publishing prepared and distributed the Manufactured Housing $$$ Primer in 2010, and copies are still available for $19.95 apiece, via the MHIndustry HOTLINE. *1 And while an excellent ‘introduction to the subject’ of MHIndustry chattel finance, it does NOT cover the ubiquitous regulatory climate since 2010. That key and timely topic offers a unique Research & Resource opportunity for MHI’s NCC division; something that should and could be researched, then distributed – for a price, to all small to mid – sized owners of LLLCommunities, those not big enough to home – grown our own $ and compliance programs! Anyone out there listening? Let’s hope so!

• ‘How to improve and maintain physical and economic occupancy in a LLLCommunity during these trying economic times?!’ Now there’s a lively combination ripe for Joe Adams’ online marketing advice, George Allen’s Mystery Shopping Lessons Learned ‘on the phone’ and ‘during on – site personal interviews’, along with Michael Powers’ ‘How to Collect 100% of Your Site Rent 100% of the Time!’ Gee; do you think we’ll see that timely and heady ‘combo’ at the MHCongress this Spring? I doubt it, but we should! Hmm. Maybe at the 22nd annual International Networking Roundtable this Fall, in…

• And how ‘bout that potpourri third combination of slightly lesser issues ‘on the minds of LLLCommunity owners/operators’? Finding good quality, near new homes ‘for sale’ in one’s local housing market? Like finding pins in a haystack these days, but search the local ‘penny saver’ advertising tabloids! Rising cost of new manufactured homes? Maybe ‘break the comfortable mold’ and get familiar with other home manufacturers, especially their Community Series Homes or CSH models! And government interference in business matters, (e.g. rent control and failure to maintain lawsuits? That can be a toughie. Easier to confront before government gets involved, with local LLLCommunity owners joining together and visiting property owners charging exorbitant homesite rents.

Then there’s the plethora of topics requested/recommended by the 70 land lease lifestyle community owners/operators who participated in the historic POWER Networking Luncheon during the Louisville MHShow during January 3023. Anyone responsible for putting together educational programs for LLLCommunity owners/operators should be paying close attention right now:

• How to Effectively Upgrade Older LLLCommunities & Homes?’ Talk to Don Westphal, and order MHI’s book on the subject – if it’s still in print.

• What are ALL the New & Resale Home Finance Alternative Available Today? Hmm. This reads similar to the ‘need’ described earlier in this blog posting, challenging MHI’s NCC division ‘closed planning meeting’ of executive offers to Research and Resource such a document or chart to all LLLCommunity owners.

• Operations – related topics, like curb appeal, rules enforcement, rent collection, resident relations, etc.. All these, and more, are covered in Landlease Community Management, the frequently updated 1988 property management text basis of the Manufactured Housing Manager® or MHM® training and certification program. Both available from PMN Publishing via the MHIndustry HOTLINE….*1

• How to Buy a New Manufactured Home to resell On – site in my Property? It’s difficult to believe there are NO contemporary guidelines or books on this topic. I’ve challenged several HUD – Code home manufacturers to do so, but so far, ‘no takers’. Wonder why?

• How to Better Market my LLLCommunity Online & via Social Media? Know who needs to write this? Someone who ‘lives and works’ as an Occupancy Specialist for one or another of the large property portfolio owners/operators!

• On – site Home Sales 101 Class for LLLCommunity Managers! Same comment here as in the previous bullet point. Is there an Occupancy Specialist listening? If so, let me know of your interest and we’ll help you pen, print, and distribute such a tome!

• Preparing for Disaster! Is There a Model Guide Available? (Yes) Actually there are several, MHI published one ‘years ago’ (Still available?) Ask them.). And the Institute of Real Estate Management® also keeps one available on their publications list. Phone 9312) 329-6000 and request a copy of the publications list.

• How to Work with a Local MHRetailer to Put Homes into my Property? This used to be referred to, tongue in cheek, as ‘The Care & Feeding of MHRetailers!’ Still included in the aforementioned Landlease Community Management text; just not taught all that much during the past decade or so. Maybe start again?

• How to Value Manufactured Homes on – site in my Property? Here we’re caught betwixt and between. NADA methodology continues to be easiest to use, and is most prevalent, thanks to federal agency preference. However, manufactured housing, per se, will never truly be considered ‘conventional housing’ until valuation is routinely via market comparables, not book value.

• How to Calculate Affordable Price Points on New 7 Resale Manufactured Homes? Finally, after 60+ years, this ‘No longer a Mystery, but now a Methodology’, is in place and used throughout the U.S. If unfamiliar with it, phone the MHIndustry HOTLINE and request a FREE copy of the ‘Ah Ha! * Uh Oh! Worksheet’. *1

Don’t know ‘bout you, but that’s a downright interesting and challenging list of educational topics coming from land lease lifestyle community owners ‘with skin in the game’, and desirous of better positioning themselves to maximize the profitability of their unique, income – producing properties. So, is anyone else out there listening? I sure am. As I begin planning now, for the 22nd annual International Networking Roundtable, I’ll attempt to incorporate as many of the aforementioned topics into that, by coincidence, 22 topic programs.

Are there additional topics you’d like to see covered in September, at the next Networking Roundtable event? If so, let me know by mail: GFA c/o Box # 47024, Indianapolis, IN. 46247., or via email:

Can’t wait eight months for helpful information like this? Then consider attending the 2nd annual SECO (Southeast Community Owners) Super Symposium in Atlanta, GA. later this Spring, or early Summer. For information, contact I certainly plan to be present.

For that matter, it’s also a good idea to let Jenny Hodge, executive VP of MHI’s NCC division, know if these and other topics should be covered at one or another of her group’s functions during the months ahead: (703) 558-0666.

End Note.

1. For an up to date, inside look, at all 20 national, super regional, and regional independent chattel (personal property) lenders and their contact information, read the soon to be released 15th annual National Registry of Real Estate & Chattel Lenders/Brokers. It’ll be a lagniappe in the March 2013 issue of the Allen Letter professional journal. This latest update contains more ‘lenders’ of both stripes, than any of the previous 14 editions. FREE to newsletter subscribers, simply phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 to do so. And guess what? A copy of the 24th annual ALLEN REPORT® will be mailed to you as well!
George Allen, CPM & MHM
Box # 47024, Indpls, IN. 46247
(317) 346-7156

February 17, 2013

Thinking Outside the Box!

Filed under: Uncategorized — George Allen @ 5:07 am

Blog # 233 Copyright 2013 17 February 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

Thinking Outside the Box

“The HUD – Code Manufactured Housing Industry Looks to New, even Renewed Product Design, as well as Novel Ways to Market, Sell and Finance this Nation’s Most Affordable Shelter Option!”

George Allen, CPM & MHM
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide

EXECUTIVE SUMMARY: Think ‘Community Series Homes’ and the ‘Removable Chassis Option’. Then realize, Today’s On – site Sale of New Homes in Land Lease Lifestyle Communities === Yesterday’s independent ‘street’ MHRetailer; the Near Plethora of Creative Home Financing Methods, even a Rebirth of Rental Homes! And now, Sound the Clarion Call for U.S. Department of Housing & Urban Development (‘HUD’), manufactured housing’s federal regulator for the past 37 – 39 years, to Aggressively Promote this Most Affordable Single Family Housing Alternative in the U.S. Today!!! YOU on board? YOU should be!


Community Series Homes, a.k.a. CSH Model HUD – Code manufactured homes, debuted during 2009. The concept was birthed at the second National State of the Asset Class caucus, held 27 February, at the RV/MH Heritage Foundation’s Hall of Fame, Museum & Library facility in Elkhart, IN. Why? HUD – code home manufacturers were near desperate to sell more new homes into (then) manufactured home communities, and these investment property owners needed smaller homes with ‘durability enhancing features’, to site on vacant, sometimes functionally obsolete (i.e. too small for behemoth Development Series Homes) rental homesites. The Community Series Home moniker was suggested later that year, by Don Westphal, the manufactured housing industry’s preeminent landscape engineer – during the 19th annual International Networking Roundtable in Chicago, IL., where three new CSH Models were on display in the host hotel parking lot. And as they say, ‘the rest is history’.

The accompanying, ‘novel marketing method’, in this instance, was to name nearly three dozen Business Development Managers or BDMs, tasked solely with marketing and selling CSH Model homes into (now) land lease lifestyle communities nationwide, oft times to one or another of the 500+/- known LLLCommunity portfolio owners/operators. The CSH & BDM situation today? Not as bright a picture as it should be! Far too few CSH models are exhibited at regional manufactured housing shows (e.g. less than a half dozen among three dozen homes on display at the recent Louisville MHShow in January 2013). And frankly, too few capable, experienced, motivated BDMs on the widely – distributed CSH/BDM Information Sheet today. *1 After all, as land lease lifestyle community owners/operators, we have an estimated 250,000 vacant rental homesites to ‘fill’ nationwide; and fewer than a dozen BDMs simply won’t get the job done! When will HUD – Code home manufacturers ‘wake up’ and take advantage of this CSH model homes and vacant rental homesite reality opportunity?


The ‘removable chassis option’ is seen, by some if not many, as a timely and practical stimulus to increase the annual volume of HUD – Code home shipments, stuck at 50,000/year for the past five years! How so? While not intended to be applicable to all new manufactured homes moving down the production line, it certainly would be an easy and attractive way to debut a top – of – the – line home option to prospective homebuying consumers (i.e. Removal of steel chassis from under the new home once at the site of installation). AND THIS IS NOT A NEW THOUGHT AT ALL.. The ‘removable chassis option’ goes back to before year 1990, when the manufactured housing industry came to within a hair’s width of seeing Congress (House of Representatives), adopt the measure as a way to reform and modernize the (then) 15 year old federal manufactured housing law. Unfortunately, the reform bill, including the chassis (removal) provision, a.k.a. the ‘Hiler amendment’ (Named for its’ chief sponsor, then Representative John Hiler, of Indiana), succumbed to 1) opposition from federal regulators; 2) industry competitors (e.g. Think site builders): and, sad to say, 3) internal industry politics.

One might ask, ‘Why wasn’t the removable chassis option included in the Manufactured Housing Improvement Act of 2000 (a.k.a. ‘MHIA@2000’), ten years later?’ Frankly, it should have been. But annual home shipment numbers were increasing then, until reaching an acme of 372,843 during 1998, before plummeting to the nadir of 50,000 new homes shipped per year for the past five years, with still only 54,881 new homes shipped during 2012.

Today however, we need every (sales & production) stimulating measure
we can identify, and the ‘removable chassis option’ is one such opportunity! This time around, however, we can ill afford to have it succumb (again) to INTERNAL INDUSTRY POLITICS! Do you recall the particular ‘devil in the details’ in 1990? I do.


‘On – site marketing and sale of repo, resale, and now ‘new’ HUD – Code manufactured homes, modular homes, ‘park model’ RVs, and more!’ Yep; that’s the 21st Century land lease lifestyle community’s new, and likely ‘here to stay’ until chattel financing returns, BUSINESS MODEL; not necessarily by choice, in many cases, but certainly by necessity! Frankly, when I entered this business in 1978; had someone told me I’d ‘see the day’ when owners/operators of this unique, income – producing property type would be voluntarily buying NEW manufactured homes to sell – sometimes at or near cost – to qualified homebuyers, just to ‘get the site rent meter running’, I would not have believed them! But that is the Stark Reality Today, and NOW, even that ‘reality’ is evolving again. For a relatively brief time, say between 2002 and 2010, land lease lifestyle community owners/operators, as they had two decades earlier (e.g. late 1970s – 80s era), sold repo and resale homes ‘on contract’, at whatever terms ‘worked’ for prospective homebuyer/site lessee cum ‘residents’ or customers.

Then along came the federal S.A.F.E. Act (Safe And Fair Enforcement for Mortgage Licensing Act), unevenly enforced among dozens of states; since joined by the federal Consumer Finance Protection Bureau or CFPB, a.k.a. ‘Choking Financial Professionals Bureau’, and its’ regulatory measures. Result? Many LLLCommunity owners/operators heretofore comfortable with ‘contract sales’ and other forms of self – finance, have since identified, and are now engaged in ‘safer’ ways to get buyers into homes on site, e.g. via ‘captive finance’ entities; the lease – option; P2P (e.g. Peer-to-Peer), P2B (Peer-to-Business), B2B crowd funding; rental units; 21st Mortgage Company’s popular C.A.S.H. Program; and soon, a new chattel lender entering the market, joining ‘the Big Four + 1’ independent, third party chattel finance firms. *2

And that’s pretty much where we are today: ‘Heavily regulated if you do (finance); damned (to potential business failure) if you don’t – or don’t do so, in strict compliance with said over – regulations!’ Two unfortunate and profound results of this Law of Unintended Consequences ‘regulating finance affair’, have been and will be:

1) The effective neutering of a nationwide cadre of entrepreneur businessmen and women, long engaged in putting low and middle income citizens into manufactured homes – without federal government assistance ($ subsidy) – at their own risk, at this base level of homeownership!

2) And as a further probable consequence, the potential and exponential increase in this nation’s already large number of homeless individuals and families; when no one else steps up to the base level of homeownership plate to assist this otherwise ignored and oft forgotten level of citizenry!

A friendly suggestion. If you agree with the sentiments expressed in the previous paragraph (part III of this blog posting), print it off and send it to your Congressman, along with a personal note, challenging him or her, as to whether they’re fully aware of the havoc their legislative actions, these past few years, have wrought!?


The independent ‘street’ MHRetailer, as reduced in number as they are (from 4,000+ nationwide a decade ago, to fewer than 1100 today) warrant comment here. For decades, these independent entrepreneur businessmen and women, along with their ‘company store’ colleagues, were the veritable backbone of the HUD – Code manufactured housing industry! MHRetailers connected the ‘production’ hands, arms, and shoulders (home manufacturers) of the industry to the torso and legs that effected the ‘marketing, selling, and placement’ of said homes outside (Think ‘land & home’ packages) and within (then) manufactured home communities, and before that, ‘mobile home parks’, nationwide. But when chattel financing, per se, went away shortly after the turn of the century, MHRetail salescenter owners/operators, without their own land lease lifestyle communities to sustain them, for the most part, withered, died, and went away. And frankly, there hasn’t been much recent change to that sorry scenario.

However, there is a missed opportunity afoot. And it has to do with these same (remaining, surviving) independent ‘street’ MHRetailers. Those who remain must relearn how to sell new manufactured homes into land lease lifestyle communities! And know what? Many LLLCommunity owners/operators, particularly the one – off property owners WELCOME the return of MHRetailers filling vacant rental homesites for them! But there’re three impediments in the way: 1) MHRetailers, in general, seem to have forgotten ‘the drill’ involved in getting new homebuyers to move on – site into land lease lifestyle communities; 2) LLLCommunity owners/operators have forgotten how to engage in the routine ‘Care & Feeding of MHRetailers’, by courting them and providing helpful information about their properties; and, 3) Either or both ‘players’ now not having ready access to independent, third party source(s) of chattel capital to support home sales transactions. So both parties need to get busy and learn what available home finance measures complement their home sales and property investment circumstances; whether it be via forming ‘captive finance’ entities; using the lease – option; P2P, P2B, & B2B social funding; rental units; 21st Mortgage’s popular C.A.S.H. Program; maybe even accessing the new chattel player about to join ‘the Big Four + 1’ independent chattel finance firms. *2


Revisit the Clarion Call to HUD, to ‘GET ON BOARD’, and actively promote HUD – Code manufactured housing as this nation’s most affordable form of single family housing available today! If you missed reading last week’s blog posting, titled: ‘Hey HUD! Help Out!’, you really should go back through the blog archives at this website (, to review how HUD’s ‘need to become involved’, was researched and articulated, using the department’s own GOAL (“Helping low – and moderate – income and minority families achieve successful homeownership….”), MISSION (“…supporting housing opportunities for low – income and minority Americans….”), and various APPROACHES “…to promoting successful homeownership opportunities for low – income individuals….” Sure ‘reads’ like HUD envisions itself as ‘the federal agency’ tasked with “Helping low – and moderate – income and minority families achieve successful homeownership” doesn’t it? SO, is this a ‘good thing’ or a ‘bad thing’ for HUD Code manufactured housing, especially regarding new homes being sited in land lease lifestyle communities. Hmm?

Well, here’s a sampling of four ‘unabashedly PRO & three definitely CON’ responses to last week’s blog posting, ‘Hey HUD! Help Out!’:

“Enjoyed this week’s blog. I can relate firsthand to the way HUD has shunned the MH sector. Hopefully, some pressure, and subsequent recognition, helps them realize we are a tremendously viable home ownership option for low to modest income families!” KS, a LLLCommunity owner (Editorial note: Reread Part III of this week’s blog posting!)

“Great blog today! Excellent subject with good points and questions.” RR, an ACM®

“One of your very best (blogs)!” JD, an MHM®

“George. You really out did yourself on this one. Kudos and kisses (figuratively) for a great blog!” EH, a veteran MHIndustry consultant


“BE CAREFUL WHAT YOU WISH FOR!” BB, a retired MHRetailer & LLLCommunity owner/operator

“Oh boy, George, (given)…this plea to HUD, I have a great deal of trepidation.” ‘Recalling the analogy of the camel’s nose under the edge of the tent, when it comes to HUD’s programs and record’…”in low cost housing programs as huge boondoggles. And asking any federal agency to help private industry is fraught with potential trouble (i.e. HUD’s regulation of MH manufacturing is a perfect example); and like subsidized HUD low cost housing programs, awash with fraud, cost overruns of huge cost to taxpayers, and complete destruction of local, private rental markets.” NB

“HUD will not help without a cost. Those costs on the initial ‘help’ the HUD Code was to give us in 1976, were WAY big in lost profits, horrific complication of our business model, quality efficiencies never achieved, and the destruction of real changes in building and pricing methods that could have been developed….” Retired home manufacturer

What say YOU? Sure, I’d like to know; and by extension, so would the faithful blog floggers (readers) at this website; but also (again) let your state’s Congressional delegation know of your thoughts on this timely, albeit controversial topic.

In conclusion; I see ‘two levels or types of support’, in this clarion call: ‘Hey HUD! Help Out!’ The first and simplest being overt, and not just tacit, promotion of HUD – Code manufactured housing as ‘affordable housing’! The other being, arranging access to federal funding intended to enable ‘renters’ to become ‘homeowners’; or in the case of land lease lifestyle communities, ‘homeowner/site lessees’.

End Notes.

1. CSH/BDM Information List is available ‘Free for the asking’, by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

2. ‘Captive finance’ refers to a captive finance company, a.k.a. ‘related finance company’ established, as a separate legal entity from the (home) selling firm or land lease lifestyle community, for the purpose of financing homes the selling entity sells. For more information, contact Rishel Consulting Group @ (217) 971-3968. Then there’s the lease – option; for information on this subject, contact Spencer Roane, MHM® via Same with the home social funding concepts commonly referred to as P2P, P2B, & B2B, where P = Person, & B = Business. Spencer Roane, MHM® is spearheading a regional cum national effort to cultivate these specialty finance investors to the HUD – Code manufactured housing industry & LLLCommunity asset class. Precedent already established throughout the UHaul business Model, where rolling stock equipment is concerned. The there’s the resurgence in ‘rental units’. For a FREE reprint on that subject, simply phone the MHIndustry HOTLINE number listed in end note # 1. Of course, 21st Mortgage Corporation’s year old C.A.S.H. Program is the popular WIN WIN WIN WIN (chattel) home loan program in place today. Contact Lance Hull via (865) 292-2120 & (800) 955-0021 for information and an application checklist. Announcement: The March 2013 issue of the Allen Letter professional journal will contain, as a lagniappe, the 14th annual National Registry of Real Estate and Chattel (Personal Property) Lenders. This is one of 12 Signature Series Resource Documents researched and published annually for land lease lifestyle community owners/operators. To subscribe to the newsletter (only $134.95/year), and receive the 24th annual ALLEN REPORT, and 15th annual National Registry of RE & Chattel Lenders, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

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

February 10, 2013

‘Hey HUD! Help Out!’ YOU too….

Filed under: Uncategorized — George Allen @ 5:42 am

Blog # 232 Copyright 2013 10 February 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

SPECIAL NOTE to readers of this week’s opinion/editorial challenge…

This op/ed piece debuts here as blog posting # 232, on the website. Next, it’ll appear as a reprint, enclosed as a lagniappe, in the March 2013 issue of the Allen Letter professional journal. It is recommended, and hoped, YOU will send copies of ‘Hey HUD! Help Out! to all members of your state’s Congressional delegation, and include a personal note requesting they discuss this timely and apt challenge, at their earliest convenience, with Department of Housing & Urban Development officials!

Hey HUD! Help Out!

“Given Our Nation’s Near Stagnant Economy, it’s Time for the Department of Housing & Urban Development (‘HUD’) to Move Beyond Simply Enforcing the National Manufactured Housing Construction and Safety Standards (a.k.a. ‘NMHCSS’, passed by Congress in 1974 & implemented during June 1976), to Actively Promote & Help Finance Placement of New Homes into 50,000 Land Lease Lifestyle Communities, Coast to Coast!”

by George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide

The above challenge ‘has been in the making’ throughout my 35 year career in housing, four years shy of the 39 years the HUD – Code manufactured housing industry has been living with – some say ‘enduring’, the only prescriptive national (home) building regulatory code in U.S. history! Why the long wait for this challenge to grow legs?

Frankly, it’s taken nearly four decades for the right pieces to come together; and now, in my opinion they’ve finally done so! But first, here’s the recent triple trigger that gelled my thoughts and experience on the timely topic, prompting this essay challenge.

The Fall 2012 issue of Evidence Matters, is a 28 page booklet published by HUD’s Office of Policy Development and Research. It opens with a feature article, titled: ‘Paths to Homeownership for Low – Income and Minority Households’. Then, within the first three pages of the HUD publication, that lead article title is stated, restated, reinforced three times by Erick C. Poethic, Acting Assistant Secretary for Policy Development and Research; as well as by Rachelle Levitt, Director of Research Utilization Division:

• “Helping low – and moderate – income and minority families achieve successful homeownership has always been a core goal of the U.S. Department of Housing and Urban Development.” P.2. Ms. Poethig (Emphasis added. GFA)

• “…supporting housing opportunities for low – income and minority American remains central to our mission.” P.3. Ms. Levitt (Emphasis added. GFA)

• “this issue of Evidence Matters examines various approaches to promoting successful homeownership opportunities for low – income individuals….” P.3. Ms. Levitt (Emphasis added. GFA)

As I read and reread of HUD’s core goal and mission; then absorbed what other writers in Evidence Matters had to say about ‘paths to homeownership’, Individual Development Accounts, Housing Choice Voucher Homeownership, and a couple shared equity models, I found myself thinking, once again:

‘Why isn’t HUD, manufactured housing’s federal regulator for 39 years, actively promoting and assisting with the financing of new home placement into land lease lifestyle communities (a.k.a.’ manufactured home communities’, and before that ‘mobile home parks’) as a practical means of ‘Helping low – and moderate – income and minority families achieve successful homeownership’?”!

Well, you’ll have to ask HUD officials how they answer ‘that question’; and why, for 39 years, they’ve not explored using the inexpensive factory – built housing type they regulate, as one, if not the key answer, to addressing this nation’s perennial affordable housing shortage? *1 Having been actively involved in factory – built housing since 1970, and the land lease lifestyle community real estate asset class since 1978, I have long and well – honed opinions on that particular matter.*2 But that’s not the gist of this essay challenge.

So, ‘Why today?’ One paragraph in Evidence Matters, crystallized the matter for me, and hopefully it will for you, as well. Here goes:

“Renters of HUD – assisted units may become homeowners via the Housing Choice Voucher Homeownership program, which has been responsible for nearly 15,000 homeownership closings in the past decade. This program allows participating public housing agencies to offer residents the option to apply their rental voucher subsidy toward monthly ownership expenses. After satisfactorily completing a preassistance counseling program that covers home maintenance, budgeting and money management, credit counseling and credit repair, and mortgage financing, the purchaser finds an eligible home. Foreclosure, delinquency, and default rates were quite low for these buyers, who were mostly single mothers with children, minorities, and people with disabilities moving into neighborhoods with higher homeownership rates and slightly lower poverty rates than the neighborhoods where they had rented.” P.8 Quoted from an interview with Janneke Ratacliffe. (Emphasis added. GFA)

It was the latter two of four highlighted portions of this paragraph that hooked me. An eligible home? Why not a HUD – Code (regulated) manufactured home? And, ‘moving into neighborhoods with higher ownership rates’? In traditional land lease lifestyle communities, the vast majority of sited homes are owned by rental home site lessees! Yes I know; for a reason no one has ever satisfactorily explained to me, the fact that underlying realty is owned by someone other than the homeowner/site lessee gives government officials, politicians, lenders, and the like, pause. Yet somehow it’s ‘OK’ to subsidize low income and minority renters living in apartment units and communities affixed to realty owned by someone other than the apartment lessee. Go figure. Some call it discrimination among housing types, and politics among housing players. Reread end note # 2.

Perhaps NOW is the time to take a renewed look at the pieces of this housing puzzle that, when appropriately addressed and accounted for, shall motivate HUD to ‘finally and actively promote & finance new home placement in land lease lifestyle communities from coast to coast’ via the Housing Choice Voucher Homeownership program, or something akin to it!

The right pieces?

• An eligible home. Must be the right size, configuration, and price for the would be homebuyer/homeowner. So, why not a HUD – regulated manufactured home?

• Rental voucher subsidy. The right loan terms and a 30% Housing Expense Factor (‘HEF’), that includes PITI: loan principal & interest, apportioned real estate taxes and insurance premium; as well as all household – related expenses, not including CATV & telephone expenses).*3

• High homeownership neighborhood. A professionally managed *4 land lease lifestyle community, charging a monthly rental homesite rate 1/3rd the monthly rent rate for a 3BR2B garden style apartment or townhouse in the same local housing market *5; and, requirement for a long term written lease, to ensure a fair and just ongoing housing value proposition for the homeowner/site lessee.

The final paragraph of the Evidence Matters publication feature, inspiring this challenge to HUD, to move from being ‘just a housing product regulator, to active promoter and finance facilitator for HUD – Code manufactured housing being sited in land lease lifestyle communities’, underscores the potential merit and reward of the aforementioned recommendations:

“Because the housing market remains fragile, it will take time and thought to
develop reforms that provide access to mortgages for creditworthy low – income
and minority families while also reducing risk and increasing protection for
consumers, investors, and taxpayers. These outcomes are vital to sustainable
homeownership for millions of Americas and are central to the overall health of the economy.”

Yes, it’s past high time for this long awaited and much needed reform; so, let’s join together, MHARR & MHI, along with the Manufactured Housing Congressional Caucus and clamor for…

‘Hey HUD! Help Out!’

End Notes.

1. Affordable housing. This is one housing writer who rarely mentions ‘affordable housing’ &/or ‘housing affordability’ without providing a definitions and a multipart frame of reference for readers. So, FYI. Definition: “Housing is affordable when individuals or households ‘…earning less than half of their area’s median income or AMI’, can afford to rent a conventional apartment and or buy a home in their local housing market.” Quoted from June 2011 issue of Multihousing Professional, page # 11. The multipart frame of reference includes Six Measures of Affordable Housing & Housing Affordability that include: the 30% Housing Expense Factor or HEF; The Housing Opportunity Index or HOI; The Housing Wage or HW; The Workforce Housing or WFH; The Income to Home Value Ratio or IHVR; and the very subjective, ‘One Who Believes’ that “Ownership housing is affordable if the price is right”. The latter frame of reference definition quoted from Shelterforce magazine, Fall of 2007. This material summarized from Chapter # 4, ‘Affordable Housing & Housing Affordability’ in the Book of Formulae, Rules of Thumb, & Helpful Measures…by George Allen, PMN Publishing, Indianapolis, IN. 46247., 2012.

2. For example, take the Manufactured Housing Improvement Act of 2000 (a.k.a. ‘MHIA@2000’). It was designed by Congress to require and achieve full parity between HUD – Code manufactured homes and all other types of housing! Specifically, the U.S. Congress directed HUD, in this law, to “facilitat(e) the acceptance of the quality, durability, safety and affordability of manufactured housing within the Department” – in other words, place HUD – Code manufactured housing into the mainstream of housing and home financing programs supported by HUD, to the tune of billions of tax dollars every year! And once the MHIA@2000 law is ‘finally and fully implemented’, after a 12 plus year hiatus, HUD, FHA, lenders and others, must STOP discriminating against HUD – Code manufactured housing, and begin treating it, in every way, like all other types of housing in the U.S. Just how far out of touch is HUD today, when it comes to ‘promoting’ HUD – Code manufactured housing as an affordable housing alternative in the U.S.? HUD – Code manufactured housing is not even on the department’s ‘radar screen’ of Strategic Plan goals and sub goals! For example; an ‘Advanced Search’, entering the words ‘manufactured housing promotion’, on the department’s website, produces this left field result: ‘Promotion of alternative dispute resolution’, along with other similar red herring results, all having nothing to do with promoting HUD – Code manufactured housing as an affordable housing choice, within or outside 50,000+/- land lease lifestyle communities located throughout this nation! Yes, it’s high time for a change: ‘Hey HUD! Help out!’

3. The oddly but appropriately named ‘Ah Ha! & Uh Oh! Worksheet’ was designed for use within and outside the manufactured housing industry and land lease lifestyle community asset class, to: Using a prospective homebuyer’s Annual Gross Income (‘AGI’) and/or local housing market’s Area Median Income (‘AMI’), as a starting point, and a 30% standard Housing Expense Factor (‘HEF’), to calculate the maximum amount of home mortgage and home Price Point a homebuyer or local housing market can afford under ‘affordable’ & ‘risky’ lending and home buying conditions, whether said home was being sited within a land lease lifestyle community or on a scattered building site conveyed fee simple. Form is available, for the asking, from PMN Publishing via the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

4. Professional property management or PM is not, unfortunately, all that widespread among the estimated 50,000+/- land lease lifestyle communities scattered throughout the U.S. As a starting point, however, firms engaged with HUD, in an effort to promote homeownership of manufactured homes to be sited within this unique, income – producing property type, in my opinion, should be expected to have at least one Certified Property Manager® or CPM® member of the Institute of Real Estate Management® or IREM® on staff at all times! And every on – site property manager should have been trained in and completed, one or another of the several professional property management programs, and not just parts thereof, presently available to them via MHI’s MHEI: the Accredited Community Manager® or ACM® program; PMN Publishing’s Manufactured Housing Manager® or MHM program; or in California, that state’s homegrown PM training and certification program.

5. 3:1 Rule of Thumb. While this guideline is hotly contested by some, it’s been a practical mainstay throughout the land lease lifestyle community asset class for at least three decades. A few tweaks apply. 1) When estimating the stabilized rental homesite rate in a land lease lifestyle community along or adjacent to an interstate highway beltway around a major SMSA or MSA, divide the average area apartment or townhouse rental rate by 2.5 instead of 3. 2) This rule of thumb might indeed need further refinement when used in one or another of the Sunbelt regions of the U.S., e.g. Florida, southern California, Arizona, Nevada. 3) And when preparing apartment/townhouse and land lease community Market Studies to effect this 3:1 calculation, ensure one is comparing apples to apples, by checking to see that items such as water and sewer billing, even heating, is treated similarly before the mathematical calculation is completed. For other formulae and rules of thumb associated with manufactured housing and the land lease lifestyle community real estate asset class, read Book of Formulae, Rules of Thumb, & Helpful Measures…available from PMN Publishing by phoning the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.


George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156


February 3, 2013

Essence of TAC! – What MHExecs Read…

Filed under: Uncategorized — George Allen @ 4:39 am

Blog # 231 Copyright 2013 3 February 2013

Perspective. ‘Land lease lifestyle communities, a.k.a. manufactured home communities, & earlier, ‘mobile home parks’, are the real estate component of manufactured housing.’

Have You Ever Wondered What You’re Missing, by Not Subscribing to the Allen CONFIDENTIAL! newsletter?

Here’s an inside look at two of 10 stories & four blog summaries, featured in the February issue of TAC!; the first, a dual focus commentary on the recently concluded, successful Louisville MHShow; the second, exciting FLASH NEWS, describing a rare educational and networking opportunity, in our nation’s capitol, for 20 land lease lifestyle community owners/operators who register…


‘They simply don’t get it!
Who? HUD – Code home manufacturers & show organizers!’

Both cases in point were clearly evidenced at the recent ‘2013 Louisville Manufactured Housing Show’, formerly known as the Midwest Manufactured Housing Show, with 30+ new homes on display, and dozens of supplier booths.

• HUD – Code home manufacturers. It’s estimated there are approximately 250,000 vacant rental homesites in 50,000+/- land lease lifestyle communities (a.k.a. manufactured home communities) throughout the U.S. today! And at least half those quarter million vacant rental homesites are likely functionally obsolete, i.e. unable to site today’s typical ‘big box = big bucks’ developer series home(s), as said sites were developed when homes were half the size they are today. And most HUD – Code home manufacturers now include a line of Community Series Homes or CSH Model homes (i.e. singlesection and smaller multisection homes with durability – enhancing features) in their design and production capability. BUT, does one see CSH Model homes ‘identified and showcased as such’ at regional MHShow? NO! Last week at the Louisville MHShow I saw NO signs promoting Community Series Homes (though admittedly, I could have missed a sign or two), and I counted fewer than a half dozen homes, mostly singlesection, that ‘might have qualified’ as such. BOTTOM LINE? Land lease lifestyle community owners/operators, large and small, need Community Series Homes to fill vacant rental homesites in their properties, and at this point in time, ‘go begging’ for same, as HUD – Code manufacturers ballyhoo ‘Big Box = Big Bucks’ behemoth models at regional MHShows. Time for a change! (On a related not, the late Warren Huddleston: RV/MH Hall of Fame member, Illinois MHPioneer, and perennial KY MHShow Chairman, frequently complained of this same shortsightedness, on the part of HUD – Code manufacturers ‘for many years’ before his demise). Hence, ‘They, HUD – Code home manufacturers simply do NOT get it!’, and continue to drag along at a nadir of 50,000+/- new home shipments per year, now going on five years in a row. Go figure.

• Show organizers. OK; I know. In years past, when there were more than 4,000 independent ‘street’ MHRetailers & ‘company stores’ (formerly called ‘dealers’), and not the paltry 1,100 remaining today, it was anathema to do anything at a manufactured housing trade show that’d pull would be homebuyers (e.g. aforementioned MHRetailers) off the showroom floor! After all, the prevailing attitude was ‘They’re here to buy (homes),not learn anything!’ Well, times have changed. Not only are there far fewer MHRetailers ‘to buy new homes to sell’; land lease lifestyle community owners, by default (few to no nearby MHRetailers selling/moving homes into their properties anymore), have had to learn to sell repo, resale, and now new HUD – Code manufactured homes, to fill vacant rental homesites, as older homes deteriorate and disappear. Unfortunately – in this industry observer’s opinion – the variety and quality of off – the – showroom – floor educational sessions has NOT kept pace with the knowledge and HOW TO… demands of MHShow registrants. That sorry shortfall was convincingly demonstrated last week in Louisville, KY when 70 land lease lifestyle community owners/operators paid $50.00/person to leave the fairground, and go learn about lease – option and other chattel finance strategies; ‘How to Collect 100% of Their Site Rent 100% of the Time!’; and, where to go to learn ‘How to Be Compliant with Today’s Myriad of Financial Regulations’.

Yes, it’s past time for HUD – Code home manufacturers and MHShow program committees to Wake Up & Effectively Deliver, 1) the appropriate housing product, and 2) the ‘How To’ educational topics sorely needed by land lease lifestyle community owners/operators, who take the time and expend the resources, to attend regional trade shows!

Enough said, and hopefully, ‘you get this point’! Few other writers in the manufactured housing industry and land lease lifestyle community asset class, with two notable exceptions*1, routinely put their professional reputation and business credibility ‘on the line’ in your behalf, to communicate the truth! Regularly challenging long held traditions and marketing practices, that once spelled Success for this ‘double dual industry’*2, but today stymie us from being this nation’s preferred housing purveyors and shelter suppliers of choice, replete with a positive brand identity, and reputation for being ‘truly affordable housing’.


FLASH NEWS: Announcing a half day Workshop for Land Lease Lifestyle Community Owners/operators in Arlington, VA., on Monday, 25 February.

Plans have been finalized that might be of interest to YOU! At the request of land lease lifestyle community owners/operators in the Washington, DC area (Think MD, VA, DE, & eastern PA), we’re hosting ‘A Workshop for LLLCommunity Owners/operators!’, Monday morning, 25 February 2013, from 8:00AM until Noon, followed by a networking luncheon at the event hotel. Capacity is limited to first 20 owners/operators who sign up!

Important Notice: This exciting Workshop has nothing to do with MHI’s
Legislative Conference being held the same day. It’s simply an educational,
networking alternative to there being no NCC division meeting this month.

Preliminary agenda includes a ‘meet & greet’ from 8 – 8:30AM; ‘State of the MHIndustry & LLLCommunity Asset Class’, from 8:30 – 9AM; ‘Maximizing Profitability of Land Lease Lifestyle Communities!’ from 9 – 9:45 AM; ‘ID New Chattel $$$ to Fill Vacant Rental Homesites!’, from 10 – 10:45AM; and, an ‘Open Discussion of Industry & Asset Class Issues, Trends, Resources, & More….from 11AM until Noon. Morning will end with a group ‘order from menu’ luncheon at the hotel restaurant. Cost? Only $75.00 per person, to cover meeting room and related expenses. Want to participate? Phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633.-4764 or (317) 346-7156. Remember; ‘First Come, First Served!’ BONUS. If you’ve wanted to learn firsthand, about the lease – option, when used in LLLCommunities; be there!


Well, there’s your taste of the nearly 14 year old limited circulation publication, the Allen CONFIDENTIAL! business newsletter. Yes, it’s expensive @ $950.00/year for 12 monthly issues. However, if a TAC! subscriber is also a subscriber to the Allen Letter professional journal (also a monthly trade publication, but only $134.95/year), then TAC! is only $750.00/year. So, taken altogether, the two newsletters and annual ALLEN REPORT, bought separately, cost $1,584.95/year. But when the two newsletters are subscribed to together, the total cost is reduced to $884.95, for an annual savings of $700.00. So interested in subscribing? Again, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, and ‘don’t risk being shown what you’re missing’, ever again! GFA


End Notes.

1. The exceptions? Danny Ghorbani, long time executive heading the Manufactured Housing Association for Regulatory Reform or MHARR; and, Ken Rishel of Rishel Consulting, with his two online finance – related publications. You can count on these long time MHIndustry executives, and yours truly, to communicate ABC3 (‘accurate; brief; clear, concise & complete’) trade – related information, that’s become increasingly difficult to find and read ‘in print & on line’ these days! And if Bruce Savage was still on board, in Arlington, VA., we’d quickly add him to this too small number of trade journalists, as well.

2. ‘double dual industry’ = ‘HUD – Code home manufacturing & distribution; land lease lifestyle community development and investment/management’.


George Allen, CPM®Emeritus, MHM®Master
Consultant to the Factory – built Housing Industry,
The Land Lease Lifestyle Community Asset Class &
Affordable Housing Purists & Enthusiasts Nationwide
Box 3 47024, Indianapolis, IN> 46247 (317) 346-7156

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