MHIndustry Missing or Avoiding an Opportunity?

COBA7® presents Blog # 356 via community-investor.com Copyright 12 July 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 the national advocacy voice, official ombudsman (press), research reporter, & online communication media 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

COBA7® Motto = ‘U Support US & WE Serve U!’, & Goal of its’ print & online media = to ‘Not only inform & opine, but transform & improve our MHBusiness model!’

Seriously Interested in Writing for Publication, Profit & Personal Satisfaction?

If so, You’re Invited to Participate in a Unique Learning Experience, 9AM-Noon on 3 August 2015 in Elkhart, IN.

In three hours, learn the basics & practical tools of writing, variety of personal & business writing for publication, and ‘How to get started!’ Group size is limited to ten, but will proceed if only a few attend. Fee? $20.00. payable at the door, to defray cost of handout material.

An RSVP of your intent to participate is required! Phone the Official MHIndustry HOTLINE: (877) MFD-HSNG or 633-4764. You’ll be told the specific location at that time. Session leader has authored a dozen books, pens monthly business newsletters, a weekly blog, & features for various magazines. Come for a unique learning experience!

Later that same day, at the RV/MH Heritage Foundation, also in Elkhart, IN., there will be a Hall of Fame Banquet, inducting ten RV/MH Industry pioneers into the foundation’s prestigious Hall of Fame. If interested in attending, phone (574) 293-8694. Already, nearly 500 have signed-up for this gala and historic event. See you there?

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Is Manufactured Housing Industry Missing an Opportunity to Recover?

Gist of the matter: ‘Should we embrace or eschew (avoid) RVs to fill vacant rental homesites in land-lease-lifestyle communities?’

It’s estimated there’s a minimum of 250,000 vacant rental homesites among 50,000+/- land-lease-lifestyle communities (a.k.a. manufactured home communities) nationwide awaiting housing units of any type! And since ‘easy access to chattel capital’ has not returned to the manufactured housing industry, we continue to bump along at a six year nadir average of only 55,000 new HUD-Code homes shipped per year since 2009 (i.e. Some predict 70,000 by year end 2015). This anemic performance compares to 372,843 new HUD-Code homes shipped during year 1998.

Not that some in the MHIndustry aren’t trying! Since 2009, when 25 percent of new home shipments went directly into LLLCommunities; the same year, Community Series Homes were introduced. And since then, an increasing number of the 500+/- known property portfolio owners/operators have been buying new CSH Models (Something rarely considered two decades ago), reselling them on-site, even seller-financing when need be. Result? By year end 2013, 30 percent of new home shipments went into LLLCommunities, and that percentage is expected to continue to rise as Community Series Homes are more aggressively marketed.

Furthermore, owners/operators of LLLCommunities, especially some of the 500+/- known property portfolio ‘players’, boast mixed-use LLLCommunities. In fact, one of the real estate investment trust owner/operators count more RV sites in their huge property portfolio than MH sites – but more about that later in this blog posting. This mixed-use business model underscores the reality there are now as many as six types of shelter to be found in LLLCommunities across the U.S.: pre-HUD Code ‘mobile homes’; post-HUD Code manufactured homes; modular units; park model RVs, ‘RVs for a season’, and in FL., even stick-built homes constructed on-site to imitate HUD-Code homes!

So, ‘nearly everyone’ appears to be doing ‘whatever it takes’ to market and sell more new homes (e.g. Community Series Homes) and fill vacant rental homesites with whatever type shelter is permissible and fits on the rental homesite, e.g. park model RVs on otherwise functionally obsolete rental homesites! Parenthetically, these survival measures have already resulted in at least two MHIndustry terminology adjustments:

• Land-lease-lifestyle community supplanted manufactured home community, given the six types of shelter sited therein, vs. ‘just two’ in previous years.

• New Breed of MHRetailer & Lender, a moniker only recently coined to describe LLLCommunity owners/operators routinely buying, selling, and seller-financing new and resale homes on-site to get the rent meter running.

While aggressive self-help measures have fought this rear action to ‘Save the MHIndustry’ from itself (After all, ill-advised industry $ practices chased chattel capital lenders away at the turn of the Century), there now appears to be an internal movement afoot, one whereby the MHIndustry appears to be distancing itself from its’ sister recreational vehicle (‘RV’) industry. How so?

The first indicator, in this industry observer’s opinion, occurred a year ago, June 2014, at MHI’s Summer meeting in Indianapolis, IN. ‘Defining & describing’ park model RVs, at HUD and elsewhere, was a hot topic at the time. And just when it appeared MHI was going to weigh-in on the side of the RV industry, all went silent. The reasons can be debated, but the MHIndustry has not involved itself in the ‘HUD & RV definition debate’ since.

Less than a year later, during MHI’s annual Congress in Las Vegas, its’ National Communities Council division unveiled their new ‘Top 50’ List’ of LLLCommunity portfolio owners/operators. While a patent imitation of the 26 year ALLEN REPORT (a.k.a. ‘Who’s Who Among LLLCommunity Portfolio Owners/operators Throughout North America!’), there was one significant – and telling, difference. Before crafting this first ‘Top 50 List’, MHI staff stripped all RV sites, (…or so they thought they did at the time – but didn’t) from the total rental homesite counts. The question ‘Why?’ has been asked repeatedly, but not answered – other than to maybe differentiate the new data base form the imitated ALLEN REPORT – which has always included RV with MH sites. In any event, that’s the second indicator, again – in my opinion, of manufactured housing leadership ‘distancing itself from the RV industry’.

And there’s more, but it doesn’t make a lot of sense. Especially considering most major HUD-Code home manufacturers also routinely fabricate and ship all types of recreational vehicles. Moving on…

I recently read published commentaries by Sherman Goldenberg, publisher of Woodall’s Campground Management newspaper, and Ross Kinzler, retiring executive director of the Wisconsin Housing Alliance, and publisher of Industry Insights. Both suggest, in round about fashion in the first instance; and directly, in the second, that perhaps the manufactured housing industry is ‘missing the boat’, maybe even ‘missing a golden opportunity’ altogether. Their commentaries?

Sherm’s piece, titled ‘Park Model Builders Buy into Go RVing Campaign’ observed: “RVIA’s Seasonal Camping Committee, comprised largely of park model RV manufacturers who vacated their former association (the Recreation Park Trailer Industry Association three years ago to join RVIA) took the next step toward integrating their affairs with that of the nation’s RV industry by voting to invest their own financial marketing reserves into the Go RVing Coalition’s national marketing campaign.” One thing is for certain, they’re not investing financial marketing reserves with the MHIndustry! Why should they? They’re obviously, ‘Not welcome!’ And yes, I understand there’s controversy, within RV circles, about becoming too closely aligned with the MHIndustry, and maybe facing the unintended consequence of park model RVs coming under federal building code oversight via HUD.

Ross’s piece, titled, ‘Industry Needs to Embrace Tiny House Movement’ goes down yet another rabbit hole, of sorts, promoting shelters 12 by 40 foot in size (as long as we keep them at 400+ square feet in size, they qualify as manufactured housing). He makes a good case for these being practical answers to rejuvenating long vacant functionally obsolete rental homesites, an ideal application of manufactured housing interior design expertise, and something today’s millennials will likely buy. How ‘bout that for a proverbial WIN WIN WIN solution to today’s ‘new HUD-Code home shipment slump’ and need for beaucoup more new homes on-site in LLLCommunities nationwide!*

So, where are YOU on all this? Do you think, as I do, that MHIndustry leaders, elected, salaried, and otherwise, are mistakenly distancing us from the RV industry? Or do you tend to be a purist (Some say Luddite) who believes we’re solely manufactured housing focused, i.e. It’s what brought us to the affordable housing dance and it’s likely who we’re going to go out (of business) with! (Sorry; couldn’t resist that crack).

In any event, we’d like to learn your opinion(s) on the subject and subjects. Simply use the contact information at the head of this blog posting. Again; the question: Should RVs continue to be an integral part of the MHIndustry and LLLCommunity asset class, OR, shunned per recent indicators on the part of at least one national advocacy body?

End note. Yes, it’s violation of some local zoning ordinances, in some states, to site RVs in LLLCommunities. But that doesn’t mean a statute can’t be changed….

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