What Does Board Service Mean to You?

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March 6, 2023

Central Florida Manufactured Housing Community

MHInsider contacted three recent appointees to the NCC Board of Governors to talk to them about the value of board service and volunteerism. Here is what they had to say:

Erica Taylor’s involvement with Augusta Communities started in 2009 and has been full-time since 2013. Taylor has extensive knowledge in the underwriting of property economics and property financing and is responsible for acquisitions, project management, and business development. She prides herself in being a dedicated professional and cultivating opportunities for Augusta Communities through business relationships and creative thinking.

What motivates you to volunteer your time to the industry?

Erica Taylor, Augusta Communities

I have volunteered my time to be on the board of governors because I think it is important to be an advocate for nonprofit ownership and long-term housing cost stability for lower-income households.

Steven Blank, Blank Family Communities

I’ve been in this industry since I was 15 years old and have seen some great and concerning changes to our business, especially over the past five years. If my voice can help guide the industry to move in a positive direction, I think that is time well spent.

Maria Horton, Newport Pacific

As a newly appointed member of the MHI NCC Board of Governors, I look forward to contributing through my many years of experience in the management and betterment of manufactured housing communities. Working for Newport Pacific, a nationwide third party property management company and leader in our industry for over 40 years, I have accomplished making a difference in many of the lives of those who live in our parks by offering them a lifestyle they enjoy. It is a privilege and one I consider very important to me.

What do you intend to see accomplished as a result of your service?

Steven Blank is the president of Blank Family Communities, a third-party management group in the Midwest with 10 years of MH ownership/management experience and membership in the Michigan Manufactured Housing Association. His company helps owners in multiple states operate their communities more efficiently, and he also is a regular contributor to MHInsider magazine.

Taylor

I hope that through my service on the board of governors for NCC I can help advocate for the industry to continue to promote manufactured housing as a high-quality, energy-efficient, and lower-cost housing option for lower to middle-income families and seniors. I would also like to help change the public’s perception of manufactured housing by focusing on the contributions responsible owners make to improve manufactured housing communities.

Blank

Listing some aspirational goals here- I would like to help our industry continue to solidify itself as a premier option for affordable housing, removing the stigma associated with manufactured homes (and communities) and be proactive about rent control.

Horton

I would like to urge the large manufacturers and community owners to advertise in the mainstream. There are commitments made but the effort requires more participation to change the perception of our industry for attainable housing.

What other volunteer efforts attract your attention?

Taylor

I’m passionate about organizations and events that seek to provide or promote social, educational, and recreational services for low- and moderate-income households.

Blank

I am also involved with the Michigan Manufactured Housing Association. Michigan has some of the best operators in the country and to be involved with such elite company has been great.

Horton

I find great satisfaction in being involved in the many other industry-related organizations whose boards I have involvement with such as AZMHCA, CMHI, and WAMH. I volunteer for the City of Carson’s Mobilehome Park Rental Review Board, and the City of Costa Mesa’s Mobilehome Park Advisory Board. This provides me with additional exposure and knowledge of local and nationwide issues affecting our industry.

Anything you’d like to add?

Taylor

My 10+ years of experience working on behalf of the nonprofit owner of manufactured housing communities in California has provided me with a breadth of knowledge related to proforma analysis and acquisition financing, the strengths and weaknesses of rent control, how to manage and respond to resident issues and complaints, how to undertake large capital improvement projects such as solar installations and utility conversions, how to rehab or replace homes, and how to navigate Mobilehome Residency Law.

Horton

Another of my recent volunteer efforts is in the formation of the non-profit WAMH organization, Women Advancing Manufactured Housing. This is a networking opportunity and information source for women in our industry. One can access and join through Linked In. I also am a volunteer member of the American Legion’s Women’s Auxiliary. There I enjoy supporting the men and women of our armed forces through fundraising and social events.

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It’s All Part of the Cycle

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Contributed Content

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March 6, 2023

MHInsider it's all part of the cycle wells fargo interest rates economy commercial real estate manufactured home communities

By Tony Petosa, Nick Bertino, and Matthew Herskowitz

When considering how to summarize our current economic and market conditions, we were reminded of an old idiom: we just can’t see the forest for the trees. In today’s world of fast-moving, multi-faceted media, we are so inundated by details and, in many cases, conflicting information that we fail to understand the big picture: It’s all part of a cycle!

it's all part of the cycle economy expansion hypersupply recession recovery wheel wells fargo manufactured home communities commercial real estate — Image courtesy of Wells Fargo

Taking a step back, it is helpful to recognize that there are four phases to a real estate cycle as outlined in the adjacent diagram: expansion, hyper-supply, recession, and recovery. While each cycle is unique and there are differences in how certain markets and properties perform, all cycles follow a predictable pattern that commercial real estate owners, including manufactured home community owner/operators, should consider when forming both short- and long-term strategic and operational business plans.

Identifying where we are in the current cycle enables us to reference past cycles for insights on expected economic policies and consumer demand going forward.

Study the Full Cycle

Coming out of the Great Recession of 2008, we slowly transitioned through the recovery phase, which was followed by a prolonged expansion period. In recent years, it would be reasonable to say that most markets have been in the expansion or hyper-supply phases with some markets beginning to see early signs of recession in 2022. Individual markets and property sectors often vary in terms of timing as they transition between phases with multifamily properties outperforming other sectors such as retail and office during recent market cycles. We are seeing this now with new single-family housing starts falling off faster than multifamily construction. The following chart presents key economic statistics before, during, and after the COVID-19 pandemic:

It's all part of the cycle economic cycle wells fargo interest rates manufactured housing commercial real estate

Many view the apartment sector as a relevant proxy for the MHC sector due to the extensive market data that is available. Recent surveys and reports on the apartment sector show a reversal in rent and occupancy growth during the second half 2022 as the dramatic shift in monetary policy appears to be influencing consumer behavior. Nationally, single-family units under construction declined each month in the second half of 2022. Meanwhile, multifamily new construction has continued, particularly in core markets, but the pace has slowed considerably from 2021. According to the National Association of Realtors, single-family housing starts in the third quarter of 2022 were 13% below the pre-pandemic historical average while multifamily constructed about 50% more units than the pre-pandemic average. Some experts point to prolonged construction completion delays as a reason multifamily has not slowed more, but multifamily demand is also benefiting from increases in residential mortgage rates, which have negatively impacted single-family housing affordability. Still, it is expected that rental rates will moderate in 2023, at least in some markets, given the new multifamily supply being added at a time when more people are moving back in with family or delaying moving out of their family homes, which is slowing new household formation. So, while pundits often disagree on defining what phase of the cycle we are in until after the fact, it is clear we have made a pivot.

Multiple Market Forces Impact Industry

It is also worth noting that every cycle has its unique economic and political backdrop, and our current environment has provided the Federal Reserve and policymakers plenty to consider: stubborn inflation resulting from extreme monetary and fiscal stimulus, an unusually low unemployment rate due to declining workforce participation, higher than expected consumer spending, and a war in Europe. The Fed has made it clear that it will remain steadfast in tightening monetary policy until inflation abates, even if that means overcorrection.

The continuing low unemployment rate also provides political cushion for further tightening if needed. With that in mind, while we expect the Fed will continue to raise rates in 2023, that does not necessarily mean the 10-year U.S. Treasury yield will increase in lockstep. The bond market, and particularly longer-term treasury bond buyers, respond favorably when inflation expectations are reduced. After hitting an all-time low yield of 0.52% in 2020, the 10-year U.S. Treasury yield surpassed many long-term averages when it hit 4.34% in October 2022 (its yield averaged 2.91% and 3.90% over that last 20 and 30 years, respectively).

Changes in demographics are also a factor for both policymakers and property owners to consider. One reason unemployment has remained low is because we are seeing, and will continue to see, a trend of fewer working-age Americans and more retirees. According to the Bureau of Labor Statistics, the labor force is projected to grow over the next 10 years at an average annual rate of 0.5%, which is a slower rate in comparison to recent decades. Factors include slower population growth and the aging of the U.S. population in addition to the declining labor force participation rate. In other words, finding good employees will continue to be a challenge so property owners should be prepared to budget for higher payroll expenses. Additionally, this demographic trend will have implications for required amenities and services for properties to remain competitive.

Certainly, there is a lot for property owners to consider when making business plans. From a financing perspective, we believe a case can be made that the worst of the increasing interest rate adjustment period is behind us, barring a reversal of the recent improvement in inflation measures. For property owners considering the timing and structure of their next financing, inflation will be key. While there has been much discussion about a likely recession on the horizon, it is important to remember that this is coming after a prolonged period of higher property values following the Great Recession and that periodic adjustments are healthy for the market over the long term.

About the Authors

Tony Petosa, Nick Bertino, and Matt Herskowitz are loan originators at Wells Fargo Multifamily Capital, specializing in providing financing for manufactured home communities through their direct Fannie Mae and Freddie Mac lending programs and correspondent lending relationships.If you would like to receive future newsletters from them, or a copy of their Manufactured Home Community Market Update and Financing Handbook, they can be reached at tpetosa(at)wellsfargo.com, nick.bertino(at)wellsfargo.com and matthew.herskowitz(at)wellsfargo.com.

MHInsider is the leading source of news and information for the manufactured housing industry, and is a product of MHVillage, the top marketplace to find mobile and manufactured homes for rent and sale.

The Estates Takes Shape in North Texas

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Patrick Revere

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February 20, 2023

the estate new manufactured home community yes communities mhinsider magazine

YES Communities Plans to add 162 Homesites to an existing 111-site community in 2023

The Estates, located in Princeton, Texas, has added 162 new sites with the most recent expansion with new homes being scheduled for delivery now. In addition to the expansion, a new amenity center has been constructed that includes a beautiful clubhouse, playground, walk-in pool, picnic pavilion, walking trails, and a pond with a pier.

YES, a Colorado-based private real estate investment trust, or REIT, will have a total of 273 total homesites at The Estates with the expansion.

The homes currently placed in the community — a mix of single and multi-section homes — come from Oak Creek Homes, built in nearby Lancaster, Texas.

Each home has a front-loaded deck constructed in the factory, and the sites have tandem parking down the side of the home, which allows for a sizable front yard.

Buyers at The Estates can rent or purchase a home.

More than two dozen homes were placed at The Estates in the second half of 2022, and there are plans for adding another 50 homes in 2023.

“With the growing need for attainable housing in North Texas, the opportunity to expand and deliver modern new homes at The Estates in Princeton was an obvious decision,” YES Communities Senior Division Vice President Trent Wagstaff said. “Building a beautiful new community center, along with a pool, playground and pond were also important in ensuring that our residents and future residents would be proud of this community.”

The residents at The Estates can enjoy a beautifully appointed clubhouse. Photos courtesy of YES Communities.

MHInsider is the leader in manufactured housing news, and is a product of MHVillage, the largest marketplace for manufactured homes.

MHI, Texas Association File Suit Against Energy Department

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Patrick Revere

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February 15, 2023

DOE energy rules department of energy manufactured housing — The James E Forrestal Building, Washington, D.C. offices for the U.S. Department of Energy.

The Manufactured Housing Institute and Texas Manufactured Housing Association announced Feb. 14 that the two have combined efforts to take legal action aimed at a delay in implementation of the Department of Energy’s “Energy Conservation Standards for Manufactured Housing” changes that are scheduled to take effect on May 31.

MHI said it has been pursuing a multi-pronged approach to the proposed DOE standards for several years, the ultimate goal being to have energy standards housed and managed by the U.S. Department of Housing and Urban Development, which is the industry’s longstanding primary federal regulatory body.

“Progress has been made with HUD and lawmakers, and we are continuing to work with DOE and HUD to find a workable and affordable solution,” the communication sent by MHI Chairman Leo Poggione stated. “However, with the looming deadline and continued lack of clarity from DOE, MHI decided legal action was the only option available.”

MHI contends DOE set an arbitrary and unrealistic one-year deadline, and that the proposed requirements are not ready for implementation on May 31.

The Energy Department failed to consult with HUD, MHI stated, and the standards are misaligned with the HUD code, they contain inaccurate cost estimates, do not take current manufactured home construction methods into consideration, and fail to address testing, inspection, and certification of homes.

MHI said it is dedicated to working toward a solution through:

Continuing to work with regulatory agencies to delay implementation of the DOE standard until there is alignment between DOE and HUD regulations.
Ensuring HUD’s Manufactured Housing Consensus Committee’s (MHCC) proposed changes to incorporate the DOE standards into the HUD code are finalized.
Supporting legislation to guarantee HUD is the primary regulator for all construction standards for manufactured housing.

TMHA Communicates with Members on DOE Filing

In a letter to members on Feb. 16, TMHA reiterated MHI’s intent for the legal filing, citing Freddie Mac language from a recent study the explains the exceptional level of attention the manufactured housing industry puts into energy efficiency.

“Make no mistake, our industry is an avid proponent of innovation and effective conservation efforts,” TMHA stated in its communication. “This commitment spans across the production, sales, transportation, and site-construction processes. A prime example being the minimal amount of waste created during our factory-built construction, along with our comprehensive recycling programs.”

MHInsider is the leader in manufactured housing news, and is a product of MHVillage, the largest marketplace for manufactured homes.

Latest Jobs, CPI Reports Lean Toward More Assertive Rate Hikes

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Patrick Revere

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February 14, 2023

CPI reports goods housing inflation prices

The Consumer Price Index released Feb. 14 came in slightly hotter than analysts anticipated, with an increase of 0.5 in January that sets inflation at 6.4 percent year over year. The CPI report combined with the recent unexpected jobs report, an increase of 517,000 nonfarm payroll positions — more than double the estimate — means the Federal Reserve likely will turn back to a 0.5 rise in March and re-set its course for the year.

Consumer categories that increased in January include shelter, motor vehicle insurance, recreation, apparel, household furnishings, and operations.

By continuing to raise rates the Fed hopes to cool growth back toward a steady 4 percent from a 12-month high of more than 9 percent in mid-2022. The Fed reduced its activity in the bond market and made a series of half-point and three-quarter-point increases prior to the most recent 0.25 hike.

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, released on Jan. 31, covers all nine U.S. census divisions. It reported a 7.7 percent annual gain in November, down from 9.2 percent the previous month.

The 10-City Composite annual increase came in at 6.3 percent, down from 8.0 percent the previous month. The 20-City Composite posted a 6.8 percent year-over-year gain, down from 8.6 percent in the previous month.

MHInsider is the leader in manufactured housing news and is a product of MHVillage, the top marketplace for manufactured and mobile homes.

JLT Market Reports Available With Updated Manufactured Home Community Data from Michigan

By

Patrick Revere

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February 9, 2023

Datacomp, the publisher of JLT Market Reports and the nation’s #1 provider of market data for the manufactured housing industry, announces the publication of its February 2023 mobile home park comps with occupancy and other vital data on manufactured home communities from 18 markets in Michigan.

Recognized as the industry standard for manufactured home community market analysis for more than 20 years, JLT Market Reports provide detailed research and information on manufactured home communities located in 187 primary housing markets throughout the United States. This includes the latest rent trends and statistics, marketing programs, and a variety of other useful management insights.

Datacomp’s manufactured housing market data published in the February 2023 JLT Market Reports includes information on investment-grade “all ages” and “55+” manufactured home communities. Altogether, the Michigan reports include data representations on 417 communities and 114,048 homesites.

What’s in JLT Market Reports?

Each JLT manufactured home community rent and occupancy report from Datacomp has detailed information about investment-grade communities in the major markets. The detailed information includes:

Number of homesites
Occupancy rates
Average community rents, and increases
Community amenities
Vacant lots
Repossessed and inventory homes, and much more

Established reports show trends in each market with a comparison of February 2023 rents and occupancy rates to February 2022. In addition, JLT Market Reports include a historical recap of rents and occupancy from 1996 to the present date in most markets.

The February 2023 JLT Market Reports for 18 markets in Michigan are available for purchase and immediate download online at the Datacomp JLT Market Reports, or they may be ordered by phone in electronic or printed editions at (800) 588-5426.

Each fully updated report for mobile home communities is a comprehensive look at investment-grade properties within a market, enabling owners and managers, lenders, appraisers, brokers and other organizations to effectively benchmark those communities and make informed decisions.

Champion’s Genesis ‘Wows’ Professionals at Builder’s Show

By

Patrick Revere

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February 1, 2023

IBS 23 Genesis Champion Homes Las Vegas Convention Center — The Genesis Homes HUD code model 4264H32G03 and the ADU model 2039H21AD1

genesis homes champion IBS 23 las vegas convention center — There was a steady stream of visitors through the Genesis homes from Champion shown at IBS 23 in Vegas.

Champion Homes returned to Las Vegas in 2023 to show a sample of its Genesis Homes collection, setting up a 1,873-square-foot factory-built home, and an accessory dwelling unit, in the outdoor village at the International Builder’s Show.

Organizers for IBS estimated an audience of more than 45,000 attendees had the opportunity to walk through the new homes, with about 200,000 people attending the collection of residential kitchen, bath, and hardware help during the week.

The show was hosted by the National Association of Home Builders, and took place Jan. 31 — Feb. 2, at the Las Vegas Convention Center.

The Champion Homes team is earning new customers by directly addressing the market need for affordable, timely, and sustainably built homes.

“We are receiving a tremendous response from our builder developer customers. Our Genesis Homes lineup provides a turnkey solution at a price point, and timeline for today’s market,” said Mark Yost, president and CEO of Skyline Champion Corporation. “Our expansion in the builder/developer market reflects our commitment to make homeownership more attainable, and we are excited to be collaborating with partners who share our vision to welcome even more customers into their new home.”

Steve Payne from Skyline Champion Corporation talks with customers at the International Builder’s Show about Genesis Homes and strategies for developing residential neighborhoods with factory-built homes.

Features of the New Genesis Homes

Genesis Homes and ADUs feature contemporary exteriors and interiors, and thoughtful floor plans and designs.

The Genesis single-family home has three bedrooms and two bathrooms. The interior layout is spacious, providing open entertaining areas and ample privacy and quiet space. The home has a welcoming curb appeal, including covered porches for outdoor living.

The Genesis Homes ADU has two bedrooms and one bathroom in 788 square feet. Accessory dwelling units are a fast-growing affordable solution for homeowners looking to add additional space on their property. Whether as a guest house, workspace, casita, or rental, Genesis ADUs have a range of floor plans to create just the right stand-alone flex space to complement a single-family home.

Show attendees can walk through the fully furnished home and ADU at the Professional Builder Show Village.

See the homes and floor plans online at https://www.genesishomes.com/ibs-2023.

About Skyline Champion Corporation

Skyline Champion Corporation has 42 manufacturing facilities in the U.S., and employs 8,700 team members, including builders in 42 facilities across the country. Skyline Champion also operates a factory-direct retail business with 31 retail locations and Star Fleet Trucking.

The company builds homes under some of the most well-known brand names in the factory-built housing industry including Skyline Homes, Champion Home Builders, Athens Park Models, Dutch Housing, Excel Homes, Homes of Merit, New Era, Redman Homes, ScotBilt Homes, Shore Park, Silvercrest, Titan Homes in the U.S. and Moduline and SRI Homes in western Canada.

More from the 2023 International Builder’s Show

Las Vegas IBS 23 Impresa modular The Carolina Cottage — The exterior of The Carolina Cottage from Impresa.

The Carolina Cottage interior, a modular offering from Impresa.

There was plenty to see in Las Vegas at IBS ’23. Four representatives from MHInsider made the event to find interesting industry news, to talk with customers, and to see how other organizations in residential housing are representing themselves. Along the way we gathered some information and took photos to share in a quick roundup.

Impresa Impressive in the Village

Modular builder Impresa, along with several partners, showed a new floorplan —The Carolina Cottage — in the outdoor village. The 1,409-square-foot home garnered plenty of attention, particularly for its high, wood-paneled ceiling. The home has two bedrooms, 1 1/2 baths, a 415-square-foot loft, and two covered porches. It came in on four trucks, each one carrying a module. The home was designed by architect Bill Gilbert and it was constructed in a factory in Greenwood, N.C. Impresa also brought along its new magazine, Offsite Builder, which details the efficiency, durability, and affordability of factory-built housing.

Not All Homes Were in the Village

Leon Integra set up this innovative tiny home in the central hall at the 2023 International Builder’s Show in Las Vegas.

Leon Integra, a Turkish logistics and distribution company with offices in Massachusetts, exhibited a tiny home at the show as a means of showing off the porcelain, rainscreen and siding, engineered wood, kitchen and bath offerings, and aluminum window and door solutions. The silo-shaped home captured the attention of passers-by throughout the show and spurred a lot of conversation about the use of space, efficiency in homebuilding, and environmental stewardship.

Beko Wins Big Prize at Kitchen and Bath Show

Zach Elkin, president of Beko Home Appliances USA, provides a tour of the company’s latest products, including a washer with an interior tub made entirely of recycled water bottles.

A primary component for the builder’s show in Vegas is the KBIS offering of the latest in kitchen and bath trends. MHInsider went on a media tour to get a sneak peek, with many of the offerings in the segment having a meaningful market in the manufactured housing industry. Beko, which is among the largest residential appliance designers and manufacturers in the world, continues to make gains in the U.S. market and this year was awarded the 2023 “Biggest Bite” among the Design Bites award winners.

This award recognizes the brand that offered the best combination of innovative products and presentation of product capabilities and benefits at the KBIS NEXT Stage. The “Brand with the Biggest Bite” was selected by a Shark Tank-like panel of judges that included Leigh Harrington, part of the USA TODAY Network, Sarah Robertson, of Studio Dearborn, and Breegan Jane, a TV host, interior designer, entrepreneur and philanthropist.

LG Signature Kitchen provided attendees on the morning media tour at IBS with a quick cooking demo and light breakfast of the perfect poached egg and farm fresh vegetables with a bacon chutney. At left, smart home expert Carley Knoblach joins Chef Nick Ritchie in the demonstration.

LG’s Signature Kitchen Suite provides at-home chefs the tools to prepare food in the best possible ways by bringing professional-grade equipment to the home kitchens. The company pioneered sous vide technology in the residential kitchens, as the first and only to integrate sous vide capabilities right on the cooking surface, alongside gas burners and induction for the perfect finish. At KBIS 2023, the company unveiled an expanded portfolio of luxury appliance innovations that drive performance, design, and precision including a 48-inch French-door refrigerator, 36-inch gas cooktop and PowerSteam dishwasher.

Live demonstrations and tastings will be led by Executive Chef Nick Ritchie based at Signature Kitchen Suite’s Experience and Design Center in culinary-centric Napa Valley, Calif. Attendees learned how to achieve gourmet cooking results using exclusive products including the versatile 48-inch Dual Fuel Pro Range, the first and only pro range with built-in sous vide, induction and gas, all on the cooking surface, along with an 18-inch steam oven and 30-inch convection oven below.

“Kitchen appliances are an investment that will be a part of your home and family for decades,” said Carley Knobloch, a tech lifestyle expert. “To make them future-proof, and able to grow with consumers’ needs and technology advances over time, will be a huge value-add for consumers. As someone with Signature Kitchen Suite appliances in my own kitchen, I look forward to the advancements and upgrades in the years to come.”

MHInsider is the leader in manufactured housing news, and is a product of MHVillage, the largest marketplace for manufactured homes.

Registration Open for 2023 Biloxi Manufactured Housing Show

By

Sean Vichinsky

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January 27, 2023

manufactured housing events biloxi trade show home show expo

Registration is open for the 2023 Biloxi Manufactured Housing Show & Expo, offering three days of education, networking, and model homes to tour for manufactured housing professionals.

Taking place at the IP Casino Resort Spa in Biloxi, Miss. from March 20 – 22, 2023, this year’s event will feature roughly three dozen model homes on display, offering professionals the chance to view the industry’s new developments and innovations in one central place.

The South Central Manufactured Housing Institute (SCMHI) comprising the Alabama Manufactured Housing Association and the Mississippi Manufactured Housing Association oversee this unique industry event.

“There is so much excitement in returning to Biloxi this year,” Mississippi Manufactured Housing Association Executive Director Jennifer Hall said. “We are expecting with the 37 home displays for our numbers to increase tremendously. The Exhibit Hall will be the same layout as last year and we only have a few booths left to fill. This could be a record year for the Biloxi Manufactured Home Show!”

Attendees will have the chance to take part in educational workshops, tour an expo floor featuring manufactured housing suppliers and service providers from all segments of the industry, and participate in networking events geared towards fostering new and existing industry connections.

For this year’s event, seminars and education will be divided into two tracks aimed at retailers and community owner/operators, respectively. Specific workshops and seminars are to be announced at a later date.

Register Today for the 2023 Biloxi Show & Expo

Registration to attend and exhibit at the Biloxi Manufactured Housing Expo is underway. For more information on the expo or to register online, visit biloxihomeshow.com/register.

Housing for the event is available at the IP Casino Resort Spa in Biloxi with a special rate for attendees who use the code “SCHC23C” when booking a reservation online or over the phone.

Additionally, exhibitor slots and sponsorships are available for the event. Those who are interested in exhibitor slots are encouraged to contact the 2023 Biloxi Show & Expo at info@biloxihomeshow.com as soon as possible, as spaces are increasingly limited. Potential sponsors can also email info@biloxihomeshow.com for more information, or contact event staff through the 2023 Biloxi Show & Expo contact page.

Learn more about the 2023 Biloxi Manufactured Housing Show & Expo by visiting biloxihomeshow.com. This event is an industry trade show and is not open to the public.

MHInsider is the leader in manufactured housing news, and is a product of MHVillage, the largest marketplace for manufactured homes.

The Opportunity in Uncertainty

By

Kevan Enger

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January 24, 2023

Kevan Enger Captstone broker manufactured housing industry preview 2023

A 2023 Manufactured Housing Industry Preview

Mobile Home Community — Kevan Enger, from Capstone, is a seller-focused broker of manufactured home communities.

2022 has been the year of inflation and interest rates. It seems that almost every conversation in the industry has come back to one of those two topics with more questions than answers…

“Will inflation finally stall?”

“Will the Fed raise rates again?”

“Will the interest rate hikes cause a recession?”

“Will the next interest rate increase be at a higher or lower pace?”

“When will the debt markets start to loosen up again?”

All of those questions have created a great deal of uncertainty in the marketplace. By nature, investors need to know the numbers, have a general idea of where things are going, and have an understanding of what is taking shape, and right now, everything seems unpredictable.

Although the pandemic appears to be in the rearview, it was the catalyst for the change and unpredictability we are experiencing. From a market crash that never came, to a recession that never fully materialized, we’ve had an economy that did the unexpected…it boomed. Prosperity came despite the pandemic, closures, and supply chain shortages all thanks to a rapidly adapting consumer and new demand as the population moved, people began working from home, and a new era emerged.

This new era is unchartered territory. Couple that with inflation, rapidly rising interest rates, a war, and fear of a recession, and you have the perfect recipe for a great deal of uncertainty.

So how is this continued uncertainty impacting the mobile home park market? In this article, we will look at where the market is today and what to expect in the coming year.

The Debt Market

Interest rate hikes have put the debt market at ground zero. After six interest rate hikes so far this year and at least one more likely by the time of publishing this article, it’s no wonder that the debt markets have come to a grinding halt. Changing at a pace not seen since 2008, albeit in the opposite direction, lenders are simply not able to effectively underwrite loans with rates rising at the current pace. As a result, leveraged buys that were ruling cash-on-cash returns across asset classes less than a year ago, are now on hold.

But, for how long?

The Cash Market

Meanwhile, the debt market’s loss is the cash buyer’s gain. Buyers with pockets full of cash have seen an opening and they’re cautiously stepping through it as supply has started to loosen in step with the tightening debt market. More supply means more opportunities for better deals as cash buyers brandish their advantage and liquidity.

However, everyone is keeping their eye on cap rates which have certainly been impacted. For 5-star properties, for example, the market is looking at manufactured home communities that were delivering a cap rate of three or three and a half, now coming in at a five or five and a half.

Three-star properties that were once at a five to a five-and-a-half cap, may now be somewhere between seven and seven and a half.

This rapid shift has taken many owners by surprise, and it’s important to understand that while we can’t control interest rates there are factors we can work with to optimize property value.

To illustrate, at our shop we’re working with owners on a variety of factors that have an impact on the value of a property. Our analysis looks at everything from operating expenses and maximizing the competition, to developing a custom marketing strategy that optimizes value and price.

This approach is critical since this past year has been particularly challenging on park owners due to rising costs. Inflation has driven up operating costs including for labor, utilities, materials, and insurance. In Florida, for instance, MHPs throughout the state have the added burden of rising insurance costs, especially after hurricanes Ian and Nicole hit the state.

However, a cookie-cutter approach to curtailing expenses simply won’t be enough. The question isn’t how can we cut expenses? It’s how can we add value while cutting expenses.

manufactured home community manufactured housing industry 2023 preview

The Outlook

While the debt market has temporarily stalled and cap rates have inched up, there is an abundance of dry powder waiting on the sidelines for clearer signals on where the economy, inflation, and rates are headed.

It’s essential for community owners to know that while the market is not moving at the velocity it was six to eight months ago, it’s still very active. Savvy investors are looking beyond the noise at the fundamentals, and the fundamentals of the market remain strong.

Historically, the mobile home park space has been widely known as a recession-proof asset class. As the most affordable housing option, demand for our homes actually increases during a recession.

In addition, mobile home park residents are known as “sticky residents”, meaning they stay for the long term, rarely moving out of their chosen community. One of the main reasons for this is that it’s expensive to move a mobile home — anywhere from $10,000 to $15,000, on average. Mobile home park residents typically own their mobile home and just pay rent for the land on which their home sits. If they were to move, they would have to transport their home to a new community — an expense most mobile home owners would be unable or unwilling to pay.

Other fundamentals to consider are rental and occupancy rates. Rental rates across the MHP space continue to rise. Most MHPs remain at below-market rents, providing a great deal of room for potential upside in rents.

At the macro level, occupancy rates are at all-time highs. However, at the micro level, there is tremendous opportunity for optimizing occupancy at parks across the country in all markets.

In addition, the recent attention by the administration, FHA, and Freddie Mac on affordable housing, and especially manufactured housing, has opened new avenues for consumers and investors. For example, the Federal Housing Administration proposed a rule to annually adjust the loan limits for its Title I Manufactured Home Loan Program, a program that insures loans used to finance manufactured homes titled as personal property. Other proposed or enacted actions include helping states and localities eliminate needless barriers to affordable housing production, including permitting for manufactured housing communities, and creating separate indexes and updating loan limits for Title I Manufactured Home Loan Program.

There is no doubt that untapped value and opportunity remain in the mobile home park market, and the fundamentals prove it.

For sellers, there is value in what they’ve built. Tapping into that value will open new opportunities.

For investors, there is untapped opportunity in the inherent value of the property.

While this unchartered territory brings uncertainty, one thing is definite, there is plenty of opportunity in uncertainty for mobile home park owners and investors.

MHInsider is the leader in manufactured housing news, and is a product of MHVillage, the largest marketplace for manufactured homes.

‘Seen and Heard’ in Louisville

By

Patrick Revere

-

January 23, 2023

the louisville show 23 adventure homes manufactured homes sahara model — The Sahara model from Adventure Homes.

Live from The Louisville Manufactured Housing Show

More than 3,000 manufactured housing professionals attended The Louisville Manufactured Housing Show Jan. 18-20 at the Kentucky Exposition Center.

After a three-year absence due to the pandemic, the KEC again was the center point of the industry, providing 27 new model homes to walk through, and more than 100 service and supply exhibitors to talk with about their offerings. It was a time for networking, learning, making deals, and moving forward into what may be a challenging yet fruitful year in business.

Victoria Cowart, director of education and outreach for Pet Screening, and company Vice President Mike Shytle attended The Louisville Show for the first time, scouting the industry as a potential new market for the pet screening software.

“The Louisville Manufactured Housing Show was impressive to see, easy to navigate, and lovely to be part of,” Cowart said. “The attendees were receptive to us and interested in our company — despite us being brand new. That was refreshing, and it leads us to think this is a vertical in the rental housing industry with great people and potential.”

Skyline Champion CEO Provides Keynote Address

Skyline Champion Corporation CEO Mark Yost provides the keynote address at the 2023 Louisville Manufactured Housing Show, held Jan. 18-20 at the Kentucky Expo Center.

Mark Yost, the CEO of Skyline Champion Corporation, spoke to a packed room the second day of the show, reminding manufactured housing professionals of the depth of housing need the country is in, and how the factory-built approach to homebuilding is the solution.

“There is not a single county in this country where a person making minimum wage can afford to rent a two-bedroom apartment,” Yost told attendees. “This should offend you.”

Rental apartment occupancy in the U.S. is 96 percent, he said. Nearly 75 percent of Americans cannot afford to buy a home. Forty-five million people won’s sell today even if they want because they would be unable to get the favorable financing they currently enjoy. Another 45 million won’t sell because they already have paid off the home and would be hard-pressed to find another home at a similar price.

This, along with the lack of site-built construction in middle-market housing, and the continued stubborn nature of local governments to accept manufactured homes, makes for a housing market malaise that begs for a proven solution.

Yost said a survey recently showed that 40 percent of Americans consider buying a home the most stressful experience of their lives. And what did those respondents say when asked how they felt during this stressful process?

“They broke down in tears,” Yost said.

Yost confided to the audience that it sometimes can be difficult to remain positive in the face of so many challenges in bringing forward what our customers want and need. But he read a letter from a longtime customer who described their Champion home as a “little slice of heaven.”

“We need a different solution,” Yost said.

Part of the solution, Yost said, had to be automation in homebuilding facilities. Another part is providing seamless services surrounding the home sale, offerings such as app-based financing and insurance, drive-through closings, and a turnkey experience that delights the new homeowner as soon as they walk in.

“There is a word for all of this for the people in this room, and that word is ‘opportunity’,” Yost said. “We have to solve this today so that tomorrow we can offer people that ‘little slice of heaven’.”

Manufactured home lenders discuss the finance options available in the current market. The Louisville Show is hosted by the Midwest Manufactured Housing Federation, made up of members from Indiana, Illinois, Ohio, Michigan, and Kentucky.

It was noted during the Lenders Panel that there were 18 consumer finance lenders registered and exhibiting at The Louisville Show, offering varied and sometimes competing programs for home finance. “A lot of us are using technology and new platforms to reach our customers in their living rooms,” Credit Human’s Barry Noffsinger said. “It’s more and more important all the time that we’re using these tools.”

Several of the lenders represented expressed continued interest in building a secondary market for chattel home loans, an effort already in the works at Cascade Finance, Triad Financial Services, and Park Lane Financial Solutions.

Manufactured housing professionals relished being able to walk through a large collection of new model homes after a three-year absence. There were 27 new manufactured homes on display at The Louisville Show in 2023.

the louisville show 23 manufactured housing industry fairmont homes tesla model sitting area

the louisville show 23 manufactured housing industry fairmont homes tesla model main bath shower large

Plenty to Look at in Louisville

Among the homes shown at The Louisville Show was the Telsa, from Fairmont Homes. The three-bedroom, two-bath home has an open floor plan with 1,012 square feet. It has a spacious living room, and a large central walk-in shower in the main bath. Fairmont is part of Cavco Industries and builds its homes in northern Indiana.

Clayton Homes built a small village at The Louisville Show and included the Pulse Collection.

New Homes That Bring The ‘Wow’ Effect

Several home-building facilities under the Clayton brand brought homes to show at Louisville, many of which were already sold, or sold at the show. Builders continue to report significant order backlogs, but have begun to make accommodations to get new homes to manufactured housing trade shows in 2023. Showing new homes to all buyers, as well as legislators and policymakers, is essential for industry growth. “When we get people through the homes we get that ‘wow’ effect,” Manufactured Housing Institute President Mark Bowersox said during his State of the Industry address the final day of the show. “It’s a lot more effective than handing them a piece of paper.”

A nice sitting area in the Tempo model from Clayton Homes.

MHInsider is the leader in manufactured housing news, and is a product of MHVillage, the largest marketplace for manufactured homes.

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