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

May 1, 2011

“Where’s Lou Vela?”, More MH questions, & GSE REform

Filed under: Uncategorized — George Allen @ 9:36 am

“Where’s Lou Vela?”, More ‘MH’ Questions, & GSE Reform!

‘Do YOU advocate CSH, attend the NCC Forum, MHCongress, & INR?’


Community Series Homes or CSH. It’s been two years and two months since a hundred HUD Code housing manufacturers and landlease (nee manufactured home) community owners/operators caucused, for first time in MHIndustry history, at the new RV/MH Heritage Foundation’s Hall of Fame facility (museum & library) in Elkhart, IN.

Why? To agree how to better market and site new manufactured homes on vacant rental homesites! How to do so? Via exciting new exterior designs (e.g. smaller ‘footprints’, front load porches and more), interior floor plans, appropriate specifications, even WOW features enticing to LLCommunity buyers. And, to market these exciting new homes, via three dozen newly appointed Business Development Managers or BDMs, employed by the HUD Code home manufacturers. It’s been almost as long a time, since the Community Series Home (differentiated from heretofore Developer Series Homes of the late 1990s), was identified and labeled as such, at the 18th annual Networking Roundtable in Chicago. Since then, CSHs have become the LLCommunity owner/operator’s ‘home of choice’, to fill vacant, and frequently functionally obsolete (i.e. ‘too small for today’s behemoth – sized manufactured homes’) rental homesites in properties throughout the U.S. and Canada.

But, ‘Guess what?’ While there’s been some significant progress, among a few enlightened HUD Code home manufacturers – now shipping increasing numbers of CSH models into LLCommunities, they’re still rarely identified as such, in corporate literature. And at regional MHShows, HUD code home manufacturers continue to exhibit the ‘bigger box = bigger bucks’ behemoths (e.g. 16X80 & large multisection units) that helped get us into our present sour business pickle! Adding ‘insult to injury’ was the absence of an awards category, at the recently completed Manufactured Housing Congress in Las Vegas, singling out these industry – saving CSH models, as being worthy of national recognition! Hopefully that‘ll be addressed at the 2012 MHCongress.

In the meantime, it’s increasingly difficult not to surmise HUD Code home manufacturers have resigned themselves to ‘die the death of a thousand cuts’. How so? Four indicators and counting: 1) at the mercy of federal regulators intent on increasing floor fees; 2) benign neglect of loan origination and secondary market financial institutions, where third party chattel capital is concerned; 3) abject reluctance to return to their ‘affordable housing’ roots, the very today market that brought them shipment volume success in the mid – 1970s; and, 4) aforementioned ‘foot dragging’ where forging active CSH partnerships with LLCommunities nationwide, is concerned. And this list doesn’t even include lack of viable warranty, responsibility for home installation, and customer service symptoms….

For the seriously interested MHIndustry aficionado, here’re the Top Ten Features that characterize contemporary Community Series Homes today:

• 3BR (bedroom), 2B (bath) design, either singlesection or small multisection homes, oft times with a front load porch, sometimes with recessed steps.

• Open floor plan with WOW factor interior treatment

• Shutters on all windows

• Vaulted ceilings

• Asphalt shingles on roof

• Linoleum in kitchen, utility & front door areas

• 40 gallon water heater

• 200 amp service panel

• Wood cabinetry throughout

• Non – plastic sinks and tubs

And, if you’d like a FREE copy of the aforementioned list of nearly three dozen official BDMs, phone the MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and request it. For detailed information about CSH product design; and, ‘Why it’s important, even critical, to upgrade older LLCommunities before buying and siting new CSH homes!’, contact Don Westphal @ (248) 651-5518. You’ll be glad you did.


5th National Communities Council Forum Attendance up by about 50 from last year’s 200 registrants! Most frequently asked question this year? ‘Where’s Lou Vela?’ Answer: He’s pretty much semi – retired these days, but maybe expect to see him at the International Networking Roundtable (INR’) later this year, when two dozen specialty realty – secured lenders and loan brokers with affinity for the LLCommunity asset class, gather for their annual Lenders’ Panel! To ensure you’re on the invitation list for the 20th annual INR, 14 – 16 September, phone (317) 346-7156 or email via By the way, the 13th annual National Registry of Landlease Community Lenders & Loan Brokers was released as a lagniappe in the April issue of the Allen Letter professional journal. Receive a FREE copy of that seminal report and directory of 18 ‘players’ when you subscribe to the newsletter! Simply phone the number cited in this paragraph.

Home finance, home finance, home finance, and ‘rentals’ were foci of this year’s NCC Forum. Bottom line? LLCommunity owners/operators should probably not go the self – finance route, either via ‘buy here – pay here’ & or ‘captive finance’ methodologies, alone! Who to contact for information and advice? The NCC Forum was the first venue where all present loan servicers and chattel finance consultancies were identified, and are listed here in alphabetical order:

• 21st Mortgage Corporation per Matt Kerlin (800) 955-0021

• CU Factory – built Housing per Dick Ernst ((972) 503-3201

• Kenneth Rishel Consulting (217) 971-3968

• Triad Financial Services per Don Glisson (904) 223-1111

• PMH Financial per John Briggs (303) 467-8009

Did I miss anyone? If so, let me know by phone or email, and once verified, I’ll add them to the directory being prepared for the 2nd edition of the Manufactured Housing $$$ Primer.

Rentals advice? If you’d like a FREE copy of the seminal article on that subject, titled: ‘To Rent or Not to Rent!’, phone the aforementioned MHIndustry HOTLINE and request it. Tells you just about all you need to know to make an informed HOW TO decision. A Word of Caution. While ‘renting manufactured homes in LLCommunities’ was ballyhooed at the NCC Forum, be careful! A 100% ‘rental unit’ community ‘works’ in a supportive local housing market; however, mixing bona fide homeowners/site lessees with a like number of ‘apartment renters’ creates two classes of citizenry in one’s property. Not always, if ever, a happy mix. And there’s much more to this decision. That’s why you need to read ‘To Rent or Not to Rent!’ before taking the plunge.

Property classification or gradation. Now this was a surprise for the NCC Forum audience; to learn U.S. Bank – Manufactured Housing Finance, has – as it turns out – an internal ABC method of determining the quality of landlease communities in which they’re considering underwriting manufactured home loans. At present, the methodology is not available for general distribution. But all is not lost. There’re two long – established programs to access to a similar end. First, the Community Attributes Systems or CAS, formalized ‘years ago’ by an MHI task force comprised of third party chattel finance firms and LLCommunity owners/operators. Simply go to to see how your LLCommunity is described thereon. Yes; know it or not, your LLCommunity is likely listed and described. Disagree with what you see/read? Identify yourself as the property owner and effect desired changes. You owe it to yourself to do so! And then there’s the widely – used manual ‘grading system’ form, the ABClassification System, designed in 1998 by Susan McCarty and yours truly, revised in 2001 by a NCC Task Force. Also available FREE to you, by phoning the aforementioned MHIndustry HOTLINE and requesting PM form # 126. Anyone in the MHIndustry & LLCommunity business ‘still talking stars’ is woefully out of date, as the Woodall System of classifying ‘mobile home parks’ has not been updated since 1976, 35 long years ago!

‘Let’s start our own bank to finance new & resale manufactured homes!’ Once again, that now – not – so – novel thought and aspiration was voiced by more than one NCC Forum attendee. But will it go anywhere this time around? I doubt it. Why? Just look at the unfolding finance regulatory environment most of us are dealing with these days? Hopefully the time will indeed come, and leaders emerge (Heck, we can’t even get a charismatic, capable, experienced leader to step forward to lead our industry out of its’ doldrums! Huh? That’s right. Just read back through this web site’s blog archives, for a few weeks, for more on that timely and disturbing subject), that’ll make this decades – old ‘dream’ a practical reality. I doubt the time is now…. Anyone disagree? Tell me!

An interesting sidebar at this year’s NCC Forum was the distribution of an article describing the Lease Option approach to filling vacant rental homesites in landlease communities. Titled, ‘Lease Option Sales Transactions Gaining in Popularity!’ by Spencer Roane, portfolio LLCommunity owner/operator headquartered in Atlanta, GA. For a copy of this seminal article, phone (678) 428-0212 or email If YOU have successful personal experience with lease option methodology, let me know!


20th annual INTERNATIONAL NETWORKING ROUNDTABLE or INR Considering renaming this year’s event as the Triple Anniversary Networking Roundtable! Why? Read on… Dates still 14 – 16 September 2011; location hopefully finalized with next week’s blog posting! In the meantime, know this: The 20th INR will be awash in celebration! How so? Besides unparalleled networking (This ‘by invitation only’ event, ensures majority of registrants are bona fide LLCommunity owners/operators & realty lenders), superb educational seminars (Nearly two dozen specially – selected presenters!), and unprecedented deal – making opportunities (‘It’s said, 50% of the next year’s LLCommunity transactions get their impetus at the annual INR!’), the INR will be celebrating its’ 20th anniversary, as well as the 70th anniversary of manufactured housing, and 15th anniversary of MHI’s National Communities Council (‘NCC’) division! How can you not want to be present for such an unparalleled networking, educational, deal making, celebratory event? Again, phone (317) 346-7156 or via to add your name and address to the official ‘invite’ list.


GSE Reform. ‘With the February 11 release of the Obama Administration’s white paper, ‘Reforming America’s Housing Finance Market’, it’s official – the two giant government – sponsored agencies Fannie Mae and Freddie Mac will no longer exist in their present form.’ This from the March/April 2011 issue of Multihousing Professional magazine, pp. 43 – 47.

The magazine feature goes on to briefly describe three plans for phasing out Fannie Mae & Freddie Mac, with each plan restricting federal credit to varying degrees:

• ‘One option restricts it entirely and limits government’s guarantee to the FHA, USDA – Rural Development, and VA.’

• ‘Another offers a government guarantee only in case of emergencies.’

• ‘Option Three still restricts federal credit – they didn’t define it specifically – but there very clear clues that if they were to extend federal credit to the market…it would be on defined terms.

With that said, the National Multi Housing Council (‘NMHC’) points out, “We have two incredibly successful business models out there for the multifamily books of business that Fannie and Freddie do. Fannie Mae has the delegated underwriting (‘DUS’), where their lenders are in the first loss position. They have skin in the game and it really colors the kind of underwriting they do….” And for that matter, “If you look at the multifamily books of the GSEs, they performed well, even through the crisis.” (Secretary Donovan)

Furthermore, because of demographic characteristics on the horizon (e.g. 78 million cohort of echo boomers entering the housing market), “half of all new homes built between 2005 and 2030 will have to be rental units.” Manufactured housing and landlease communities anywhere in that mix? Let’s hope and plan for it to happen!

Relative to whether Fannie and Freddie have met three affordable housing goals set for them in 1992, by the Federal Housing Enterprises Financial Safety & Soundness Act, a recent Policy Analysis published by the CATO Institute (titled: ‘Fannie Mae, Freddie Mac, & the Future of Federal Housing Finance Policy’ by David Reiss), pointed out: “Fannie & Freddie typically meet these goals, although they sometimes may use financing shenanigans (such as buying a portfolio of loans solely to meet affordable housing goals) to do so.” (And) ‘A number of studies have indicated Fannie and Freddie actually cannibalize the FHA loan market by lending to borrowers who would have otherwise received FHA mortgages.” (Finally) “the U.S. General Accounting Office has also questioned whether Fannie and Freddie, notwithstanding their affordable housing mandate, do any more than any other lenders to promote affordable housing.” Hmm. Where have we, in the manufactured housing business, encountered that latter matter before? Anyone recall our ‘duty to serve’ contretemps? (p.9)

So, how will Fannie and Freddie end up, down the line? The above referenced Policy Analysis had this to say on the matter: “Because Fannie and Freddie are poor agents of public policy and political powerhouses with unmatched influence, the two companies should be fully privatized.” – by extension, no longer Government Sponsored Enterprises or GSEs. (p.14). In any event, whatever plan for housing finance and GSE reform is agreed upon, it’ll take five to 10 years to fully implement.


Grand Opening! Shiloh Estates in Indianapolis, IN. This is an early example of the turning around of a LLCommunity acquired via the foreclosure process. If interested in attending this 14 May event (10AM – 6PM), phone (317) 356-1666. Address? 7441 Chinook Circle (Washington & Shortridge Roads), Indianapolis, IN. 46219. I certainly plan to attend! GFA


George Allen, Realtor®, CPM®Emeritus, MHM
Consultant to the Factory – built Housing Industry &
The Landlease Community Real Estate Asset Class
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156 &

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