Blog Posting # 832; Copyright 21 February 2025. EducateMHC
Know this! HUD-Code manufactured housing (‘MH’) is federally-regulated, performance-based, affordable-attainable, factory-built housing (a.k.a. offsite construction). Land lease communities (a.k.a. manufactured home communities & ‘mobile home parks’) comprise the commercial real estate (‘CRE’) component of MH; and, with variations of housing finance (e.g. chattel or ‘home only’ loans & real estate-secured mortgages), describe the post-production segment of MH.
EducateMHC is the official MH historian, trade term & trend tracker, as well as perennial information source. Contact EducateMHC via (317) 881-3815, email: gfa7156@aol.com, and www.educatemhc.com, to purchase Community Management in the Manufactured Housing Industry (A copy of which should be in every land lease community nationwide), & SWAN SONG – History of land lease communities & official record of annual MH production totals since 1955
And my autobiography, From SmittyAlpha6 To MHMaven, describes personal combat adventures in Vietnam as a USMC lieutenant, a 45 year entrepreneur business career in MH & community ownership, as well as freelance consulting and authoring of 30 nonfiction texts.
George Allen is the sole emeritus member of the Manufactured Housing Institute (‘MHI’), a founding member of MHI’s National Communities Council (‘NCC’) division, an RV/MH Hall of Fame enshrinee, as well as Allen Legacy columnist and editor at large for MHInsider magazine.
SOMEONE IS ALWAYS FIDLING WITH MH
Which, in your mind, is more important as a key factor pursuant to the success (i.e. increased unit production and shipment) of manufactured housing? Increased access to all forms of HUD-Code manufactured housing finance, especially ‘home only’ mortgages, OR, making today’s new homes ‘climate resilient’?
Well, interestingly that second factor, climate resiliency, is the one the renown Urban Land Institute (‘ULI’) focuses on in its’ Research Report titled ‘Building a Climate-Resilient Manufactured Housing Stock’ (February 2025). This 65 page report is a compelling ‘read’, not only for the climate resiliency proposed for our type housing, but even more so for what ULI researchers have to say about our industry and realty asset class (i.e. land lease communities, a.k.a. manufactured home communities). For a copy, contact the Urban Land Institute.
In the paragraphs to follow, I’ll mostly quote MH industry-specific excerpts from said report, and leave the use and interpretation thereof, to you.
By way of introduction to MH: “Manufactured homes (‘MH’) are dwelling units built in a factory and transported to a site for installation. Modern-day MHs are built to a single federal building code – the Manufactured Home Construction and Safety Standards (‘MHHCSS’), also known as the HUD code – and to the same standards of quality and durability as other housing types. In fact, MH is the only housing type whose standards for construction, design, and installation preempt state and local building codes. MHs are less expensive than equivalent site-built houses and can be constructed as a faster pace.” (lightly edited. GFA)
And then there’s this: “If manufactured housing is to help address our national housing shortage, it will need to be climate resilient – that is, capable of withstanding the shocks and stresses of our current and future climate.” My response? ‘Who sez?’ Due to lack of easy access to chattel capital, not climate resiliency, the MH industry continues to languish at a pitiful 100,000 units produced and shipped annually – when during decades past, we eclipsed 580,000 during the early 1970s and nearly 400,000 during 1998. Year 2024? Only 103,314 units! Consequence? “MH represents 6 percent of the US housing stock and is home to about 18 million people.” I do not see ‘climate resiliency’ boosting MH production now or in the future.
Furthermore, “Nationally, an estimated 40 percent of MH is in land lease communities known as manufactured home communities, sometimes called mobile home parks. These communities typically lease plots of land (known as ‘pads’)*1 and utility hookups to the owners of MHs. Recent evidence suggests new MH stock continues to be placed in land lease communities at a significant level, 37 percent in 2020 placed therein.” As a related aside, MH placement is concentrated in the Southeast U.S., e.g. Texas, Florida, N. Carolina, then California. (lightly edited. GFA)
Switching focus. “A significant body of research and evidence, including the (33) expert interviews we conducted for this report, point to mobile homes (i.e. pre-HUD Code) as a critical source of climate risk and a top priority for federal, state and local interventions. But how many of these units are there? Using two different methods, we estimate there are 1.24 to 1.35 million mobile homes in the nation’s existing housing stock.”, with California having the largest stock of pre-1976 mobile homes, followed by Florida, then Texas.
Pricing and affordability. “While MH share of newly built affordable housing has been decreasing since 2014, in 2021, nearly all (99.4 percent) new MH were priced below $250,000., compared with a little over a quarter of new site-built homes. During the same period, MHs accounted for virtually all new homes priced under $125,000.” And, “…MH offers a vital pathway to homeownership for households with low and moderate incomes. The income of the average MH buyer stands at $57,000, much lower than the $93,000 for site-built buyers. National analyses show nearly one in five homes purchased by first-time, low-income households, is a MH.”
The challenge. “U.S. is facing a severe housing shortage, analysts estimate the country needs 3.7 million additional home units to meet current demand, and will need to build millions more in the coming decade to keep pace with population growth, replace aging housing stock, and rebuild homes lost to disasters.”
“We conducted a total of 33 interviews with 44 stakeholders actively involved in 1) production of MH, 2)creation of MH-related policies, programs, &/or regulation, 3) creation &/or protection of affordable housing for low-income families…” and “Interviews with a group of leading manufactured housing experts with a wide range of backgrounds and unique perspectives.” Or so they say. NO HUD-Code housing manufacturers are included in this heady mix, and only the REIT, SUN Communities, represents the interests of all land lease communities. Beyond that, Freddie Mac (but not Fannie Mae), Next Step Network, Lincoln Institute of Land Policy, National MH Owners Association, HUD, and ROC USA are the only other names I recognized. Not as heterogeneous or august a research group, in my opinion, as promised above.
The interviews did uncover a proverbial and perennial MH Achilles Heel. “…HUD sets the minimum standards for MH installation, but states can adopt and enforce additional requirement if they meet or exceed federal guidelines. Thirty-six states have opted to enforce their own installation standards, including anchoring requirements, while HUD administers installation in the remaining 14 states (neither Hawaii nor Washington, DC). The result is a fragmented installation process, and there is little reliable evidence about the quality of installations or performance of installation standards under climate conditions beyond hurricanes and high-wind events.” My opinion? Universal approval and use of George Porter’s innovative and practical Frost Free Foundation system, for safe and secure installation of MHs, continues to be long overdue!
“The consolidation of MH community ownership. “…(‘mom and pop’ parks) have now become a prime target for acquisition by a range of investors, including multistate corporations, real estate investment trusts, and some of the largest private equity and real estate investment firms in the world….(causing) a very large barrier to how we can implement climate resilience….” Once again, the paucity of housing finance trumps climate resiliency!
“The local regulation of MH (i.e. zoning and land planning) limits its potential as climate-resilient housing. And here, NIMBY trumps climate resiliency!*2
Of course there’s much more to this report, and perhaps we’ll cover some in a future blog posting.
End Note.
- True MH aficionados today refer to these ‘plots’ & ‘pads’ as rental homesites.
- NIMBY = ‘Not in My Back Yard’.
DID YOU KNOW?
The lead or title on the Manufactured Housing Institute’s website reads as follows: ‘Elevating Housing Innovation; Expanding Attainable Homeownership’. Ah finally, we’re purposely distancing ourselves from the ‘Affordable Homeownership’ shibboleth that brought us to this housing dance! Is this a good or bad move on the part of our elected and volunteer national advocacy leadership? What do you think? Please let me know via gfa7156@aol.com
George Allen