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

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

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