Take Time Now, to Sit Back & Ponder…About What?

Blog Posting # 619 @ 29 December 2020; Copyright 2020: EducateMHC

Perspective. ‘Land lease communities, previously manufactured home communities, and earlier, ‘mobile home parks’, comprise the real estate component of manufactured housing!’

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INTRODUCTION: At least once annually, we owe it ourselves, peers, employees, and loved ones
To reflect on what’s been ‘good & bad’ about our business interests during the previous months. Have you done so yet? This would be a good week and weekend to start.


Take Time Now, to Sit Back & Ponder…

About What?

Are you resigned to the covid pandemic malaise affecting manufactured housing production these days, i.e. raw material shortages and labor force fluctuations; or, committed to figuring out how to

• Encourage our industry’s HUD overseers to put their mouth where their writings have been for some time, and overtly promote manufactured housing as affordable housing!

• Markedly improve our industry’s access to home-only mortgage financing by, if need be, requiring loan security buy-in, on the part of land lease community owners.

• Engage in national product (manufactured housing) and brand (Big 3-C firms*1 & others) marketing and advertising via various public, business, and social media.

• Getting everyone using standard trade terminology, e.g. manufactured housing, land lease communities, homeowner/site lessee, resident (not tenant), and more….

And this list continues. For a complete listing of such Evergreen Issues*2, read the 32nd annual ALLEN REPORT, released this month as a Resource Document for PRIME subscribers to The Allen Confidential newsletter. (Visit www.educatemhc.com to subscribe & get the ALLEN REPORT).

Do you remember Ross Kinzler, retired executive head of the Wisconsin Housing Alliance? Well, in recent correspondence he commented on four manufactured housing industry-related issues that trouble his thinking these days (i.e. going into year 2021):

• There is NO industry acknowledgement that many land lease communities are ‘aging out’ these days. Their electrical systems and streets are failing. In rural areas, communities are always on the watch for failing septic systems. The contraction in the number of such communities is real and accelerating, due to these factors and urban encroachment.

• ‘Big Box = Big Bucks’ (1995 – 2005) was a trend the economic downturn destroyed, but it was not all a waste. It taught the industry it can compete with traditional homebuilding. However, the industry never fully faced the issue of what I call ‘building code conflicts’. For example, the HUD-Code allows for construction of stairwell openings narrower than IREC requires for stair treads. Fire alarm interconnection is another issue. The HUD-Code must be expanded to include code for the entire structure being fabricated.

• Where are the raw land developers? Land lease community new construction is nil. Where is the appetite to use manufactured homes in multifamily rental communities? Homes in full and completed developments, renting in the $1200-1900 range, would be hot!

• The industry needs a Task Force, ‘think tank’ or someone thinking and outlining plans for the future! One example would be an industry agreed upon development standard for new land lease communities. (Lightly edited. GFA)

Your reaction to all this? This is the mental exercise all manufactured housing executives and land lease community owners should engage in this time of year. Give it a try & let me know!

Yet another manufactured housing industry leader voiced this sentiment (criticism) in recent email correspondence:

“Meanwhile, (neither) Fannie or Freddie have any interest in chattel loans for would be manufactured housing buyers/site lessees. That’s where help is needed! That’s where the Duty to Serve is. And they (GSEs & FHFA) are nowhere to be found!” (Lightly edited. GFA)

End Notes:
1. Big 3-C Firms = Clayton Homes, CAVCO Industries, & Skyline-Champion
2. Evergreen Issue is content that is always relevant and timely.


Did You Know?

Manufactured Housing Institute & its’ leader, Dr. Leslie Gooch, have been identified as being among the most influential lobbyists in Washington, DC. today. Good to know!

BUILDER magazine, in the current issue makes a positive nod to pre-built housing:
“One proven way to reduce the framing budget is with an offsite system, which consists of pre-built framing components such as wall, floor, and roof panels. Material costs are about the same as with site-built framing but, according to one leading panel provider, (one) can shave 11 framing days from a typical single-family home.” And later in the same magazine, this statistical gem: “A strong, well-trained workforce is critical to the industry due to housing’s outsized role in the economy, and there are possibilities for significant gob growth. Building 1,000 average single-family homes creates 2,900 fulltime jobs and generates $111 million in taxes and fees for all levels of government to support police, firefighters, and schools.” P.57

And how, during late 2010, at the annual Networking Roundtable, in Phoenix, AZ., Randy Rowe challenged nearly 200 land lease community owners, to implement a Five Part Market Share Recovery Plan:

• Better Home Warranties and Improved Customer Service for homeowner/site lessees
• Chattel Financing Matters, even with loss of 3rd party lenders, expect increased scrutiny
• Economic Security, for residents, via long term leases and fair rental homesite rates
• Multiple Listing Service. Nonexistent than; still the case, sad to say.
• National Marketing of housing product and communities. No movement here either.

For more detail on these five challenges, see p. 52 of SWAN SONG, available via www.educatemhc.com

George Allen, CPM, MHM

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