‘Here We Go Again!’ & ‘Did YOU Know?’
COBA7® community-investor.com Blog # 322 Copyright @ 9 November 2015
Perspective. ‘Land-lease-lifestyle communities, a.k.a. manufactured home communities and ‘mobile home parks’, comprise the real estate component of manufactured housing.’
This blog posting ‘is a national advocacy voice, ombudsman press*, statistical research reporter, & online communications resource for all LLLCommunities in North America!’
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
• Ombudsman press. ‘Manufactured housing’s ronin, fielding inquiries, complaints
Introductions to this week’s COBA7® blog posting at community-investor.com website
‘Here We Go Again?!’ It’s almost scary how, ‘What goes around, comes around (again)’ in manufactured housing. Here we are, facing ‘Three Strikes & We’ll be Out!’- as an industry, of the national affordable housing market – and now we’re told, by MHI leaders, the DOE’s proposed energy efficiency standards are a ‘win-win’, for homebuyers & the environment. Yet, in my opinion and that of others, it must be a ‘win-win-win’ proposition for everyone involved – for our industry to survive! But to date, there’s been no ‘cost benefit analysis studies’ published for proposed energy efficiency innovations!
‘Did YOU Know?’ By default, the Community Owners (7 Part) Business Alliance®, or COBA7®, recently assumed the mantle of Official Historian to the manufactured housing industry and land-lease-lifestyle community real estate asset class. This is evidenced by the Official State of the MHIndustry & LLLCommunity Asset Class SSRD (Signature Series Resource Document) published and distributed every February, and the Paradigm Shifts of Mobile & Manufactured Housing, since 1970, circulated every November.
Here We Go Again?
MHI & DOE’s much ballyhooed ‘win-win’ energy efficiency standards MUST BE ‘win-win-win’;
Risk the Manufactured Housing Being ‘Three Strikes & Out!’ of the Affordable Housing Market Mix!
What follows here, is a sequel to last week’s blog posting: ‘Three Strikes & Manufactured Housing is Likely Outa the Affordable Housing Game!’
There you read
STRIKE # 1) = “Easy access to chattel capital went away (circa 1998-2001), nary to return!”
STRIKE # 2) = “We’re now (post 2010) so overregulated financially, homebuyers who need our brand of affordable housing, can no longer qualify for it!” And now maybe,
STRIKE # 3) = Would be do-gooders, under the PC (politically correct) auspices of ‘energy conservation standards’, favor jacking the purchase price of manufactured housing out of the reach of individuals and families needing – but are least capable of buying – new, heretofore affordable (*), homes!”
With that said, let’s begin this week’s blog posting with a direct quote from the Manufactured Housing Institute’s (recent) HOUSING ALERT, titled:
‘MHI Leadership Yields Positive Results for Industry in Energy Efficiency Standards’, where the following statement, with parenthetical editorial remarks inserted therein, reads thusly:
“…the new proposed energy efficiency standards will increase first costs (i.e. New home prices!), consumers will realize significant cost savings. The impact will be lower monthly net costs and improve affordability (*), a win-win for our homebuyers and the environment.” (But NOT the manufactured housing industry, struggling to ship more than 60,000 new HUD-Code homes per year for the past six dismal years, 2009 thru 2014!)
Did you catch that? These measures are being promoted as a ‘win-win’ for ‘homebuyers & environment’! As nicely PC as ‘energy efficiency standards’ implementation might be, without that third ‘win’ in the sequence, we have no national advocate championing HUD-Code manufactured housing – the very industry fabricating, marketing, and selling affordable(*) homes to the American home buying public! Again and again, there must be a third ‘win’, inclusive of the ‘MHIndustry’, OR, ‘We’ve swung and missed, for the third time since year 2000’ – and are likely priced out of the affordable housing market!
Why the ‘Here We Go Again?!’ title at the beginning of this blog posting? Because we’ve ‘been here’ time and again, as this ‘win-win’ scenario reminds one of the first two Strikes against the HUD-Code manufactured housing industry; which were:
Strike # 1 = circa 1998-2001. I easily recall the gala days at national advocacy group annual meetings, and the like, in Palm Springs, CA. and elsewhere – when horsdeoeuvres and wine flowed copiously. Where every attendee received really nice gifts from numerous independent chattel capital lenders courting manufacturers and (then) manufactured home community owners/operators. Yes, those were the ‘go-go’ days for the MHIndustry – even though some waxed uncomfortable with the knowledge that many, if not most, of our home buying customers were being ‘turned upside down’ (financially), in their newly purchased HUD-Code homes nationwide. We deserved that strike called against our industry.
Strike # 2 = pre and post 2010, as conventional housing’s financial bubble burst – like manufactured housing’s had ‘years earlier’. At the time, we suffered a spate of naïve national leaders – who, in retrospect, should have seen the regulatory storm brewing; initially via the S.A.F.E. Act; later, in the form of Dodd-Frank legislation. And all the while, one Midwest freelance consultant (not me) sounded warning after warning, to both national advocacy bodies, but all fell on deaf ears. Why? Perhaps because one lobbyist believed it ‘knew all the answers’ – but in retrospect didn’t; and the other, had little to no firsthand knowledge at the time, of the financial needs and workings of post-production segments of the manufactured housing industry – and is still learning. Bottom line? As an industry, we’re now way overregulated, and don’t really deserve this strike against us.
Strike # 3 = is on the horizon, as we end year 2014, and enter 2015. Today we’re being asked to support a ‘win-win’ proposition for ‘homebuyers & environment’ that should be a ‘win-win-win’ proposition for homebuyers, the environment, and the manufactured housing industry! Without that third, important ‘win’, methinks we’ll see Strike # 3 come our way – in the form of 1)‘higher new home prices’ (In excess of $2,000 per new singlesection manufactured home) & 2) ‘fewer sales & shipments’ (i.e. likely back down to 50,000 or fewer homes per year)! I hope not – but until the DOE and both national advocacy bodies ante up publicly, with comprehensive cost-benefit analysis studies for every energy efficiency standards to be implemented, we won’t know the whole story, and will not be able to accurately predict the probable $ consequences. There’s more…
Consider this sobering business truism, so characteristic of the MHIndustry:
The Big Three ‘C’ HUD-Code home manufacturers, due to their large size and estimated collective national factory-built housing market share of 80+/-%, are far more capable – due to economy of scale – of absorbing federally-mandated & self-imposed unit price increases, like those related to implementing these energy efficiency standards and innovations, than smaller, regional factory-built housing manufacturers! Can you see the likely inevitable (predatory) handwriting on that wall? You’d have to be blind not to…
And next week here, maybe read how this example of ‘cram down environmentalism’ is now likened by some, to Obama Care, as a forced tax on homebuyers – since shelter is one of those basic human needs.
Now, what follows here, will be a curious ‘read’ for some, but not for others. Depends on one’s perspective, i.e. whether an entrepreneur businessperson, salaried corporate executive, managerial employee, association bureaucrat, or otherwise. In any event, I circulated a DRAFT copy of this blog posting to seven carefully selected, thoughtful individuals, some being COBA7® ‘MHInsiders’, others not. Besides the expected and received content and edit recommendations, there was this telling gem from one of the brightest minds active in manufactured housing finance today:
“I truly dislike government intervention into business.” All HUD-Code homes can be energy efficient, when manufacturers (perform) on a level playing field. But that is only part of the challenge. Another “…part of the problem arises from (our industry’s) failing to correct a specific problem regarding structuring retail finance, to safely utilize longer (loan) terms.” In the meantime, we continue to push for cheaper construction, instead of coming together to address this perennial, systemic but solvable, maybe even industry saving, issue!
I’ve already gone on record, calling for MHI & MHARR to co-host the MHIndustry’s first National Strategic Planning Meeting, this Winter, in an easily accessible, affordable location, with the venue open to anyone ‘in the MHBusiness’ willing to pay their own way! MHARR has already dismissed the idea; MHI has been mute on the matter. So, either COBA7® will proceed alone to this end, OR you, the aforementioned entrepreneurs, executives, managers, and bureaucrats, must ‘catch the vision of restructuring and righting our industry’, OR together face it’s likely demise, as we suffer ‘Three Strides & We’re Out!’ of the national, affordable (*) housing marketplace.To express your interest and or support of this (meeting) goal, phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764, or email: email@example.com And it certainly wouldn’t hurt for you to contact the national advocacy entity of your choice, and let them know your ‘take’ on this timely and strategic topic and meeting.
The writer quoted in the earlier paragraph has committed himself to support a National Strategic Planning Meeting for YOU and our peers – and I’ll be there as well! GFA
End Note. (*) Working definition of affordable or affordability: “Housing is affordable when individuals or households ’…earning less than half the Area Median Income or AMI’, can afford to rent a conventional apartment and or buy a home in their local housing market.” – defined by postal zip code and or county. This quoted from Bruce Savage’s The First 20 Years!, PMN Publishing, Indianapolis, IN. 2014, pp. 105 & 106
Did YOU Know?
Historians are few and far in between throughout the manufactured housing and recreational vehicle industries. Just this month Al Hesselbart, longtime recreational vehicle industry writer/author, and Foundation Historian at the RV/MH Hall of Fame Library & Museum in Elkhart, IN., retired.
This leaves the Community Owners (7 Part) Business Alliance®, or COBA7®, by default, as the sole historian in behalf of manufactured housing and land-lease-lifestyle communities nationwide, and in Canada.
How does Official Historian responsibilities manifest itself where COBA7® is concerned? For starters, the alliance researches, publishes and distributes the industry/asset class’ annual Official State of the MHIndustry and LLLCommunity Asset Class outline (one of a dozen Signature Series Resource Documents or SSRDs updated monthly) every February, as a lagniappe in the Allen Letter professional journal. This comprehensive outline is made available to every state and province manufactured housing association throughout North America, & COBA7® often addresses the topic..
And in November of each year,’ The Paradigm Shifts of Mobile & Manufactured Housing…since 1970’ is published and distributed as a lagniappe in the Allen Letter professional journal. This SSRD makes for an educational, and at times humorous ‘read’, for MHIndustry executives & LLLCommunity owners/operators, e.g. Did YOU know…
• When & where the phrase ‘D&R Deliveries’, of mobile homes originated? What do the letters D&R mean? Hint. They mark the sorry beginning of our perennial ‘image challenge’ among would be home buyers and consumers nationwide..
• In what year was the Manufactured Housing Association for Regulatory Reform, or MHARR, founded? Hint. Some say it was a philosophical spinoff from MHI.
• When was this MHIndustry mantra popular? ‘We have no $ down, no job, no problem deals for you!’ Let’s hope we never return to those enronesque days….
• And when was this rallying cry popular in MHCircles? ‘Be a stud, sell a HUD!’
• When was the ‘Year of the hudular’? (A combination of HUD-Code & modular home design and construction popular for a time)
• And when did we hear this self-serving cry? ‘When does hurricane season begin?’
• During what year was this LLLCommunity neo-reality labeled: ‘New Breed of MHRetailer & Lender!’ For that matter, who coined this latter day term for ‘dealer’: independent (street) MHRetailer(s). No, it wasn’t me. Think ‘rainmaker’
And there’s much more to this ongoing historical record of the MHIndustry & LLLCommunity asset class. If you’d like to be privy to all this, and much much more, simply phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764 and affiliate with COBA7® at the Option II level for $544.95. You’ll receive an annual subscription to the Allen Letter professional journal and a dozen SSRDs, beginning with the popular ALLEN REPORT, in January 2015. Become a true ‘MHInsider’ and affiliate with COBA7® today! More than 200 of your peers have done so since January 2014!