Blog # 511; Copyright @ 2 December 2018; community-investor.com

Perspective. ‘Land lease communities, previously manufactured home communities, and ‘mobile home parks’, comprise the real estate component of manufactured housing.
This blog posting is the sole national advocate, voice, official ombudsman, historian, research reporter and online communication media for all North American land lease communities!
To input this blog &/or affiliate with Community Owners (7 Part) Business Alliance, a.k.a. COBA7, use Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764; or gfa7156@aol.com
COBA7 Motto: ‘U Support US & WE Serve U!’ Goal of its’ print & online media? To inform, to opine, & help transform & improve manufactured housing & LLCommunity performance!

“Evergreen content is content that is always relevant…like evergreen trees retain their leaves all year. Interesting and relevant content, that does not become dated, is necessary in order to be found online by search engines.” Likewise, evergreen issues are issues always present and relevant, as in the case of manufactured housing & land lease communities, where we have several. The following paragraphs identify a half dozen evergreen issues. If you think there are more, please let us know via gfa7156@aol.com or via the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764.

Who’s really responsible for the proper, safe, and secure installation of HUD-Code manufactured homes when sited on scattered building sites conveyed fee simple, and on rental homsites within land lease communities? Depends on who one asks. Installation manuals shipped with every new home, in this industry observer’s opinion, leaves the issue (question) open to interpretation and application, e.g. factory rep, traditional (street) MHRetailer, licensed installer, homeowner installing on scattered site conveyed fee simple, & land lease community owner dealing with his own property.

Department of Housing & Urban Development (‘HUD’), the federal agency that regulates manufactured housing, resists overtly promoting this type factory-built housing as the attractive, quality, non-subsidized, energy efficient, transportable, affordable housing it is! On one hand, via its’ plethora of housing support programs (e.g. Community Development Block Grants, HOME Investment Partnerships, Assisted Living Conversion Program, and many temporary programs) HUD is quick to direct taxpayer monies everywhere else, but not towards manufactured housing as affordable housing.

Existing manufactured housing stock is aging faster, in toto, than replacement stock can be fabricated and shipped from more than 100+ factories nationwide. In addition, some estimate there’re 250,000+/- vacant rental homesites in land lease communities able to site new manufactured homes if they – and chattel capital for home loans, were readily available today. Not. So, with each passing month, the ability to refresh and fill land lease communities, as well as scattered building and rental homesites, falls further and further behind.

HUD-Code manufactured homes, as well as modular and park model RV units, sited within land lease communities continue to be ineligible for real estate-secured home financing, forcing said homeowners/site lessees to pay, on the average, three points or more for their home loans, than if same home was sited on a scattered building site conveyed fee simple, with the homeowner owning underlying realty. Over the decades, there have been unsuccessful efforts to mitigate this inequity, via long term leases, etc., but nothing, to date, has ameliorated the issue.

Relative to the sale of new and resale manufactured homes, using chattel or realty-secured mortgages, there’s a longstanding practice of selling customers ‘more house than they can afford’, by not including annual household utility expenses in the target 30 percent Housing Expense Factor. Doing this makes for a ‘risky’ transaction. However, when the home mortgage monthly PITI (principal, interest, taxes, insurance)payment calculation includes household utility expenses in the target 30% HEF, the transaction becomes affordable, as customers buy ‘the house they can truly afford’.

Most enduring evergreen issue afflicting HUD-Code manufactured housing and land lease communities is the oft negative public image of this symbiotic pairing (i.e. roughly half of all new manufactured homes are sited on rental homesties within the unique, income-producing property type). Why negative and enduring? Trailers and mobile homes of the 1950s & 60s are still around. And forget their presence is a reality check as to what the U.S. homeless population would be without them! Plus, there’s a predatory equity play characteristic of investors overpaying for land lease communities, then ‘jacking site rents’ as part of their ‘get rich quick’ scheme. And negative public image continues….

Oh, there are more evergreen issues germane (‘closely associated with’) manufactured housing and land lease communities. Here’re two: absence of a secondary market facilitating the valuation and sale of manufactured home within and outside land lease communities; and, lack of a secondary market facilitating the sale of seasoned chattel loans to free up capital for more new home sales transactions. Then there’s the lack of emphasis on professional property management training and certification throughout the realty asset class! Today, slightly more than 100 Certified Property Manager (‘CPM’) members of the Institute of Real Estate Management (‘IREM) claim an affinity to manage land lease communities. And there’re nearly 1,500 certified Manufactured Housing Managers (MHM), and fewer than 200 Accredited Community Managers (‘ACM’) spread among 50,000+/- properties nationwide! Not nearly enough!

You are invited to participate in this review and conversation of evergreen issues related to the manufactured housing industry and land lease community real estate asset class! See contact information at the beginning of this blog posting.


George Allen, CPM & MHM
COBA7, division of GFA Management, Inc., dba PMN Publishing
Box # 47024, Indianapolis, IN. 46247
(317) 346-7156

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