Datacomp, the publisher of JLT Market Reports and the nation’s #1 provider of market data for the manufactured housing industry, has published the June 2023 mobile home park comps with occupancy, home details, pricing specifics, and other vital data on manufactured home communities markets in Iowa, Nebraska South Carolina, and Virginia.
JLT Market Reports provide detailed research and information on communities in 187 major housing markets throughout the United States. These include the latest trends and statistics, marketing programs, and a variety of other useful management insights.
Datacomp publishes the JLT Market Reports and is the nation’s #1 provider of market data for the manufactured housing industry. JLT Market Reports are recognized as the industry standard for manufactured home community market analysis.
June 2023 manufactured housing market data published in JLT Market Reports for Iowa, Nebraska, South Carolina, and Virginia include information on 172 “All ages” and “55+” manufactured home communities.
Altogether, the reports from Iowa, Nebraska, South Carolina, and Virginia manufactured home communities include data representations for 28,919 homesites.
More About 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
Pricing
Community amenities
Vacant lots
Repossessed homes and inventory homes
JLT Market Reports also include management insights that rank communities by the number of homesites, occupancy rates, community type, and housing mix. Established reports show trends in each market with a comparison of June 2023 statistics to June 2022 and a historical recap in most markets from 1996 to the present date.
The June 2023 JLT Market Reports for manufactured home communities in Iowa, Nebraska, South Carolina, and Virginia are available for purchase and immediate download online at the Datacomp JLT Market Report website, 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 business decisions.
After working together for years in finance with an industry giant and getting their feet wet turning around a manufactured home community they acquired together, Ben Halliday and Jordan Bucy decided to blend their banking and real estate experience to start Zippy, a new community-focused chattel lender.
It took some time to find the right entry point. Initially, the two looked at a lot of deals they found interesting, but often didn’t pencil. Eventually the pair landed on a value-add community in Lubbock, Texas, though not without some hesitation.
Turns out the hesitation, at this point long passed, was somewhat founded.
“The community we bought was pretty run down, 20 years of deferred maintenance. The sewer and water were bad, half the sites had no water and a dozen of the homes of the 91 sites were actually viable homes,” Zippy CEO Ben Halliday said. “We spent our nights and weekends there for three years. We focused on property management during the week and then on the weekend we’d go on-site and get to work on redevelopment.”
“We’d stay at the community on the weekends, sleeping in one of the available houses for sale at the time, digging sewer lines and rehabbing homes. It was hard work, but it was even more rewarding,” Zippy COO and President Jordan Bucy said.
The pair eventually replaced the old infrastructure, landscaped and installed new amenities including a playground, dog park, and party pavilion. During this time, Halliday and Bucy brought in and sold new homes to fill up the original development. Beyond the joy in seeing new homeowners relish in their upgraded community, one of the proudest moments was when the City of Lubbock visited during a rezoning initiative to add 32 lots on adjacent land.
“Several council members and planning officials visited our community to inspect the progress, as part of their diligence,” Halliday said. “We were so proud to host them and thankful we ultimately got approval to add to our growing community. The mayor gave us a nod and thanked us ‘for bringing affordable housing to Lubbock’. That was immensely appreciated.”
Reflection on a Problem and Developing a Tech-Driven Solution
As Halliday and Bucy worked in the community, they developed a passion for manufactured housing. They were proud of the neighborhood that formed over the years, and proud of the homes so many families called home. But one big challenge kept nagging them.
“Since we were five hours away during the work week, we took advantage of modern property management tools and took our homeowners online for payments and maintenance requests, and it was well-received — no more paper checks!” Bucy said. “That’s when we knew our industry was ready for digital.”
They built a digital sales process using available technology selling a handful of homes a month, mainly as a result of social ads and the community’s website.
“It worked great, but it all broke down during financing,” Halliday said. “We wanted a process that was more modern, friendly and fast for us and the homebuyer. But it was 2017, and there were few options for community operators to offer customers a digital home buying experience.”
The Next Journey
It took a few years of trial and error, but Bucy and Halliday finished their project at The Lone Star community and began to contemplate what was next for them.
“Maybe our background as bankers led us here, or our continued obsession with the home buying experience — probably both — but we couldn’t get over the finance experience and the lack of tools and technology available,” Halliday said.
Faced with a decision between a planned new development, or a completely new venture in MH lending, the two landed on Zippy. Halliday admits the pair was more excited about developing a community from the ground up, but the Zippy co-founders kept discussing how they would hit their infill goals and deliver home ownership “the way it should be”and the financing experience always dominated the conversation.
Yet unnamed, the Zippy of their dreams would be a snappy, modern lending platform for today’s consumer, a web-based experience that is seamless and nearly immediate, backed by a team of industry veterans and experienced technologists.
“Let’s go fix this problem,” Halliday recalls saying to his now co-founder Bucy.
Bucy cemented the decision with what would be Zippy’s mantra, “Let’s do this.”
Great Tech + Amazing People = Happy Homeowners
So much of the industry was still paper-based at that time, and there was plenty of room for growth. When the pandemic hit, the housing sector went on a rocket ride and the fuel it needed was efficient finance technology.
“We wanted to create a digital front door for the homeownership journey for manufactured housing,” Bucy said. “This allows us to accept and work applications from anywhere in the world, 24-7. And that really opens things up.”
A top priority early on was the philosophy of partnering with a homebuyer in a way that delivers all the benefits of modern technology, paired with a dedicated home buying guide.
“We have a single person who works with the homebuyer all the way through the journey. We spent a lot of time envisioning and building a virtual close, where today our bilingual closers walk a buyer through their loan documents in a virtual closing room, ensuring they’re set up for success, from start to finish,” Bucy continued. “Of course, a hugely important stakeholder in MH ownership is the retailer. This part was the easiest to build, as we’d spent years dreaming up what we wish we had while selling homes.”
Zippy’s digital borrower portal keeps sellers updated on loan progress in real time, delivering new leads, loan status updates, document requests, closing updates, and digital marketing tools.
The Zippy Application Process
“The home buyer pulls out a smartphone and takes a photo of a QR code that pops up a form to gain residence at that specific community,” Halliday said. “It then lets us know there is someone who is interested in buying.”
The form has 10 fields. It is made to look simple from the user’s perspective, but contains a large amount of custom-built technology that runs sophisticated information about the location, community, and home, and then about the buyer.
“We can get a good offer to the buyer within seconds,” Bucy said.
The response to the original inquiry pops up in the app, and simultaneously goes to the applicant’s email. Then an individual they refer to as your designated ZippyGuide, a licensed mortgage loan originator, immediately places a call to the applicant to congratulate them on the beginning of their home buying journey, and asks them about their goals.
The customer is invited to a borrower portal, and can move forward independently uploading documents and making decisions only the consumer can make. Among other questions, it asks about the desired term for a loan, down payment amount, approximate home price, and whether the inquiry is for a single home or more than one. The closing can be done on a smartphone from any location and typically takes 15 minutes.
“The home buyer has all the information they need to make the right decision for themselves,” Bucy said. “We also recognize the challenges of the community owner and manager, so we have a custom-built portal that a community manager can load all of their info into and interact with us on the home buying journey so they know what’s happening throughout the process.”
The average residential transaction in the U.S. takes more than a month, Zippy currently averages half of that, and can close what they call “Go Go Go” loans in as little as five days, when everyone is aligned.
Fintech Draws Investor Interest
At press time, Zippy was available to customers in 12 states — Alabama, Arizona, Florida, Georgia, Indiana, Kansas, Oregon, Kentucky, Michigan, Missouri, Texas, and Virginia. The plan is to double its presence during 2023, thanks to a strategic partnership with FirstBank.
“FirstBank has extensive experience in manufactured home lending and has invested in fintech partnerships that enable us to offer innovative solutions that meet the needs of our customers,” FirstBank Chief Innovations Officer Wade Peery said. “In today’s housing market, finding new paths to affordable homeownership is critical. This partnership will make buying a home possible for many new individuals and families.
Connecting with Community Owners, Residents
Halliday credits Bucy for identifying the manufactured housing industry opportunity, and Bucy credits Halliday with the inspiration to bring new technology to the space. The pair have continued to enjoy community ownership, building a great lending platform, and coming up with new ways to provide great places to live.
“We developed this really strong passion for the industry,” Bucy said.
“You see the value of well-built, modern, good-looking homes and the communities our industry is building today are truly stunning places to live,” he said. “These days it’s more home loans than playground building, but it still feels really good.”
Halliday said he and the Zippy team have loads of pride in the industry.
“We’re making a real impact on housing affordability,” Halliday said. “It will be our life’s work to help our industry deliver great homes to great people, and we’re so proud to do it.”
The Federal Reserve in its June 14 meeting opted to halt interest rate hikes in the face of waning inflation, slowing growth, and a resilient job market.
Tighter credit conditions for households and businesses are likely to weigh on economic activity, hiring, and inflation. The extent of these effects remains uncertain. The Committee remains highly attentive to inflation risks, the Fed stated. The June pause follows 10 consecutive rate hikes beginning in March of 2022. That streak included four consecutive three-quarter point hikes during the second and third quarters of last year.
The Fed wants the market to reach maximum employment with a 2 percent inflation rate, which is half of the current rate, down from 9 percent at the peak.
“In support of these goals, the Committee decided to maintain the target range for the federal funds rate at 5 to 5-1/4 percent. Holding the target range steady at this meeting allows the Committee to assess additional information and its implications for monetary policy,” the Fed stated.
What To Know About The Federal Reserve
The Federal Reserve, commonly referred to as the Fed, plays a vital role in shaping and maintaining the stability of the United States economy. Established in 1913, the central bank is responsible for conducting monetary policy, supervising and regulating financial institutions, and promoting overall economic stability.
At the core of the Fed’s responsibilities lies its control over monetary policy. The Federal Open Market Committee, comprised of members from the Federal Reserve Board and regional Federal Reserve Bank presidents, determines the course of this policy. By adjusting interest rates and managing the supply of money and credit in the economy, the Fed aims to foster conditions that support maximum employment, stable prices, and moderate long-term interest rates.
One of the primary tools used by the Federal Reserve to influence monetary conditions is the manipulation of the federal funds rate. This interest rate, the rate at which banks lend reserve balances to each other overnight, serves as a benchmark for various lending rates throughout the economy. By raising or lowering the federal funds rate, the Fed can influence borrowing costs for businesses and consumers, thereby affecting spending and investment levels.
The Federal Reserve also acts as a supervisor and regulator of financial institutions to ensure the safety and soundness of the banking system. It conducts regular examinations of banks and implements regulations to protect consumers and maintain the stability of the financial system. The Fed’s oversight extends to a wide range of institutions, including commercial banks, savings associations, credit unions, and holding companies.
In times of financial crisis or economic turmoil, the Federal Reserve serves as a lender of last resort. During the 2008 financial crisis, for example, the central bank implemented a range of emergency measures to stabilize the banking sector and support credit markets. It provided liquidity to financial institutions, expanded its balance sheet through large-scale asset purchases (known as quantitative easing), and introduced innovative lending facilities to address the severe market dislocations.
HUD Secretary Marcia Fudge kicks of IHS23 on the National Mall in Washington, D.C. on June 9.
The U.S. Department of Housing and Urban Development invited innovative housing professionals to the National Mall June 9-11 to kick off National Homeownership Month and put on display some of the nation’s top creations that help provide increased access to high-quality affordable housing.
“HUD and its Office of Policy Development and Research have supported innovation in housing and building technologies since the beginning, and these investments have contributed to changes in building codes, improvements in industry practice, and most importantly, lower housing costs for American families,” HUD Principal Deputy Assistant Secretary for Policy Development and Research Solomon Greene said. “The Showcase continues that tradition, featuring the latest technologies and designs that can help meet the nation’s growing housing affordability and climate resilience needs.
“We are so grateful for all of those who brought their innovations to the National Mall,” he said.
Visitors on the National Mall stream into the Sanibel, a new duplex model home from Cavco Industries. The 1,770-foot floor plan offers side-by-side 885-square-foot residences, each with a front porch, large living, dining, and kitchen space, two bedrooms, and ample storage.
Sam Landy, president of UMH Properties, said the duplex homes will go on their own 5,000-square-foot lot.
“So people can have their own garden, they can have a pet, they have a shed, there’s no common-wall neighbor above, below, beside them,” Landy told Secretary Fudge during a walk-through of the home. “They have their privacy, so it becomes a very enjoyable place to live.”
Fudge noted during the tour what a great value the new type of home could be for young people and families looking to rent. “This is something they would never expect,” she said.
“This is great,” Fudge said. “Thank you, thank you, thank you. I could stay all day but I have to go see some more houses.”
Leaders from across the country came to Washington, D.C., to represent the industry, including Cavco Industries President Bill Boor, at right. Earlier in the week, the Manufactured Housing Institute hosted its MHI on the Hill event, which involved manufactured housing professionals from all parts of the industry taking to Capitol Hill to share housing priorities with Senatorial and Congressional elected officials and staff.
The wide-open and inviting kitchen and dining space in the Sanibel offers a place to prepare a meal for the family, or host a dinner party.
The Sanibel has a pair of spacious bedroom, including this well-lit space on the back of the home. Notice, out the left window is the Washington Monument.
The home on display on the National Mall was made possible through a partnership between Cavco Industries, the Phoenix, Ariz.-based builder, and UMH Properties, the Freehold, N.J.-based community owner. The Sanibel duplex on display was built in a factory in Virginia and is destined for a community in Carlisle, Pa., to be the new home for a pair of families.
There is a lot of talk within the manufactured housing industry about image these days. As a landscape architect and planner of manufactured housing communities for more than 50 years, image has been an important consideration in the design and the focus of my activities in the industry. It is the source of great frustration to me that many new communities are still being designed like the trailer parks of the past.
Row on row of new homes spread out like dominoes on the land, with little apparent thought given to the final appearance of the community and the image it will portray for generations to come. Most developments are laid out by draftsmen in engineering offices with little training in effective image planning.
Why is it so?
Do developers, engineers, designers and planners feel that our customers don’t deserve better? Is there an assumption that creative planning is too costly? Is enough energy being expended by the national and state industry organizations to promote good design as an important part of our image-building strategy? Are we doing enough to educate the planners in good design and encourage and approve projects that are attractive and desirable living environments?
Our counterparts in the site-built housing business are keenly aware of the benefits of creative planning. The traditional neighborhood development movement, open space conservation planning, planned unit developments, cluster designs, and curvilinear concepts are stock in trade for better developers. The appearance of their developments from the street, curb appeal, and sizzle of their homes is as important a part of their merchandising effort as their floor plans, interior decorating, and furnishings. Models are creatively furnished inside and attractively landscaped outside to excite and stimulate the customer. Builder’s displays at development model centers are creatively done with renderings illustrating the final and complete appearance of the home package.
Contrast this to the way the majority of manufactured homes and developments are merchandised. Far too often our industry’s homes are pictured as “plain Jane” boxes devoid of the elements that would make it a home rather than a house. These same units regularly are shown to the public at sales centers without these important added elements.
Manufactured home community owners and subdivision developers also miss an opportunity when houses are permitted in developments without the simplest of requirements that would assure curb appeal. Even simple appearance requirements would help to assure growth in the value of the home, the development, and our industry.
The majority of manufactured homes are designed and built with image emphasis on the long side of the home, this is all well and good when the home is placed long side to the street on wide subdivision and land-lease lots. Unfortunately, these wide lots result in a significant increase in development cost and a reduction in density. Even developers of high-end subdivisions focus on lot width and density.
A few manufacturers are placing emphasis on CrossMod homes, homes that look good on larger lots and in scattered site settings. These too often only fit on wider lots. On the other hand, an increasing number of what we call “community series” homes place emphasis on the appearance of the narrow end of the home and has been shown to be a great improvement in the appearance of homes on narrower homesites.
Time after time I still hear negative comment from opponents to new developments at zoning hearings about the unattractive appearance of our homes and communities. Most of this well earned from our past performance. Perhaps if our industry were to place more emphasis on the final product, the completed home, we could more rapidly move toward greater public acceptance of manufactured homes. We always show images of attractive homes and communities at zoning meetings.
Study upon study sponsored by MHI have shown that with sensitivity to detail and proper presentation our homes are welcomed in most neighborhoods.
I am certain that continuing to develop new “parks” and selling incomplete homes will perpetuate the industry stereotypes that have held us down. And I am convinced that the continued growth in of our share of housing in America is dependent on our ability and willingness to view each new home sold and each new development as an opportunity to improve the image of manufactured housing.
As a manufactured home community owner, the decision to sell can be fraught with uncertainty, especially when it comes to tax implications. In today’s market, you might be wondering, “Where does my money go?” For those who have been operating for decades, this question is even more pressing.
But there are ways to improve financial outcomes when selling, by minimizing capital gains taxes and maximizing liquid assets to invest.
Understanding Tax Deferral Strategies: Exchange or Installment Sale
When selling a manufactured home community, the tax codes offer planning options that can significantly reduce out-of-pocket expenses, such as capital gains taxes. Two key strategies include tax-deferred exchanges and installment sales.
A tax-deferred exchange involves purchasing a new property of equal or greater value than the property being sold. This postpones the capital gains taxes the seller would have otherwise paid. However, this option may not be ideal for those looking to retire and divest from property ownership.
An installment sale is a contract that allows the seller to defer taxes for decades. This option allows for a tax-free lump sum that is nearly equivalent to the sale proceeds, with no qualification on how it may be reinvested.
The Power of Choice: Exploring Real-World Examples
Bruce Jones is the founder and CEO of TaxWealth, a California-based tax analysis and solutions research company that helps its clients solve capital gains and other tax problems by using tax deferral and other planning methods.
“Property and business owners are often surprised to learn that their tax obligation when they decide to sell may be even higher than the current 20 percent federal capital gains tax and the state tax rate they would also have to pay,” Jones said. “Manufactured home community owners can benefit greatly from tax deferral strategies like exchanges or installment sales to address their tax obligations and achieve their financial goals. Understanding all the options and the potential tax implications when selling a property is crucial. The good news is that they have choices.”
For instance, a California property owner who had a $10 million property with a taxable gain of $7.5 million would face $2.8 million in capital gains taxes. If they opted for a conventional sale, they would receive $2.7 million after paying off the debt and taxes. But by using a tax deferral planning approach, the property owner was able to pay off the debt at the time of the sale, defer taxes for decades, and receive $5.5 million tax-free to reinvest.
In March, UMH Properties CEO Sam Landy introduced a letter to the Senate Finance Committee in support of potential changes to opportunity zones that would allow for an influx of much-needed affordable housing.
An opportunity zone is a geographic area designated by the United States government where certain investments can receive preferential tax treatment in order to spur economic development and job creation in economically distressed communities. These zones were created as part of the Tax Cuts and Jobs Act of 2017.
Investors who invest capital gains into Qualified Opportunity Funds that then invest in qualified businesses or properties within designated zones may be eligible for tax benefits, such as temporary deferral, reduction, and even elimination of the capital gain on the funds investment if held for 10 years. The purpose of this program is to encourage investment in underdeveloped communities and provide investors with a tax incentive to put their capital to work.
In a conversation with MHInsider, Landy said he and his team conducted a field survey of opportunity zones that would be viable locations for manufactured housing.
“There are manufactured home communities in opportunity zones that need to be upgraded and promising properties where we can raise money to build new communities,” Landy said. “We have identified $100 million in investment opportunities in six months, and we continue to survey new areas.
The lone caveat in taking advantage of an opportunity zone for manufactured housing professionals is the requirement that investment must come from a capital gain realized within the last 180 days.
“What does it matter where the money comes from when we’re talking about satisfying a need that everyone agrees on in affordable housing?” Landy asked.
The language change as proposed is captured in a simple 54-word appendix to the code:
(d) Additional Flexibility for Investments in Manufactured Home Communities
Investments in manufactured housing communities that meet all other requirements of this section shall be eligible for the tax treatment in subsection (c), notwithstanding a failure to meet the requirements of subsection (a)(1)(A) of having a gain during the 180-day period prior to such investment.
“We know everyone is interested in much-needed new housing, so we’re simply asking to waive that 180-day requirement for this reliable type of housing,” Landy said. “It’s going to fall right into the investment horizon for those interested in our efforts.”
The March 7 hearing on “Tax Policy’s Role in Increasing in Affordable Housing Supply for Working Families” was called by Chairman Sen. Ron Wyden, (D), of Oregon, and Ranking Member Mike Crapo, (R), of Idaho. In addition to testimony provided by UMH and Landy, the Manufactured Housing Institute provided its support for the potential change, and suggested support for manufactured housing in other areas of the tax code.
“MHI also asks the Committee to explore ways to make current tax incentive programs more effective in generating investments for manufactured home communities,” MHI stated for the record. “Manufactured home communities are a critical affordable housing model. Because of the financial and lifestyle benefits of owning a manufactured home versus the limitations that come with renting an apartment or buying a condominium or other site-built home, millions of individuals and families have chosen to live in land-lease manufactured home communities.”
The industry awaits discussion on the bipartisan topic of reducing barriers for affordable housing and the potential for a bill on the change in opportunity zone requirements.
“As much as anyone can be optimistic that legislation is going to be adopted, we are optimistic,” Landy said.
What follows is a full, unedited republishing of Landy’s letter to the committee.
Written Statement of Sam Landy President and CEO of UMH Properties
3499 Route 9 Suite 3C Freehold, NJ 07728 Senate Finance Committee Hearing March 7, 2023
“Tax Policy’s Role in Increasing Affordable Housing Supply for Working Families”
I am submitting this statement in order to request that the Committee consider adoption of legislation to amend the existing Opportunity Zone statute to promote affordable workforce housing.
I am the President and CEO of UMH Properties Inc., one of the premier owners and operators of manufactured home communities in the Nation. UMH Properties is publicly traded on the New York Stock Exchange. We currently own 135 manufactured home communities in 11 states with approximately 25,700 developed homesites. Seven of our communities are currently located in Opportunity Zones. I have worked in the manufactured housing industry since 1985 and have been President of UMH Properties since 1994.
UMH Properties has a 55-year history of providing quality affordable housing in manufactured home communities. Videos of our communities are available on our website and showcase the high-quality affordable housing that can be delivered through investment in manufactured home communities. We rent 1,000 sq.ft. three bedroom, two bath, modern, energy efficient, vinyl sided, shingle roofed homes on 5,000 sq.ft. lots for $800 per month and up, to families with household income of $32,000 and up. We also sell both single section 1,000 sq.ft. homes and 1,800 sq. ft. multi-section manufactured homes to people who buy the home and rent the lot. Those homes sell from $80,000 to $250,000 and have lot rents as low as $400 per month in our community.
Manufactured housing is the most affordable homeownership option available for low- and moderate-income families in America. The average income of a manufactured home buyer is $35,000 – while the average income of a home buyer buying a site-built home is over $100,000. Residents of manufactured home communities consist of people of all ages, family status, and incomes. We find that many residents seek manufactured housing based on the lower monthly payment derived from owning a financed manufactured home and renting a lot in a community as compared to owning land for the home and paying a mortgage and taxes on that land or renting an apartment or buying a house. Other residents use the proceeds of the sale of an existing home to pay all cash for a manufactured home and then only pay the lot rent. And other residents do not have the down payment or other ability to qualify for financing the purchase of a manufactured home and chose to rent the manufactured home. Further many people see themselves as needing a short term, less then three-year, affordable housing solution and see renting a manufactured home in a community as the best lowest cost solution. Since 2011 we have rented over 9,000 manufactured homes for monthly rent as low as $800 per month.
Manufactured home communities – also known as land-lease communities – are a critical model for the delivery of affordable manufactured homes. 51% of new manufactured homes are currently being placed in manufactured home communities. There are more than 43,000 land-lease communities in the U.S., representing almost 4.3 million homesites. These communities offer sites for families to place their manufactured homes, with professional management of the community and amenities that go with it.
One of the greatest challenges facing older manufactured home communities is the need for an infusion of funds to address neglected capital improvements like roads, sewer, and water. UMH Properties has been highly successful in purchasing aging manufactured home communities in need of significant capital repairs – in order to modernize them and thereby protect the value of the investments of the manufactured homeowners living in those communities at affordable land lease rental rates. Further we add rental homes to fill the vacant lots in those communities and increase the supply of affordable work force housing in the community.
These purchases and improvements of aging communities require significant investments. UMH Properties has a total market capitalization of approximately $2 billion, with gross revenue of over $190 million per year. UMH invests over $70 million a year in new rental homes and capital improvements to improve our manufactured home communities. These investments allow us to provide our residents with the highest quality affordable housing at the most reasonable rates. UMH shareholders include the pension funds that our residents have equity interests in.
UMH has successfully renovated and upgraded seven manufactured home communities in opportunity zones and sees the brilliance of the idea of tax incentives attracting capital to previously underinvested areas of the country. UMH’s experience in opportunity zones and renovating communities in Nashville and Memphis convince us that the concept of providing investors who make ten-year investments in affordable housing in opportunity zones with tax benefits results in the increased supply of badly needed affordable housing and further attracts employers and additional jobs and tax revenue to areas of the country that previously suffered from economic stagnation.
UMH believes that the current opportunity zone fund law could be amended slightly so that far more meaningful investment is made in affordable housing in opportunity zones. Our experience is that the existing law inadvertently limits the pool of capital available to create affordable housing in opportunity zones by requiring those funds come from existing capital gains. That requirement is the basis for the criticism of the opportunity zone program only being available to the wealthy who have capital gains. We believe opening up affordable housing investments through opportunity zones to all investors will greatly increase the pool of capital flowing into opportunity zones to create affordable housing.
It is our opinion that the greater the supply of funds invested in affordable housing in opportunity zones the quicker the area will become economically able to be self-sufficient from growing tax revenue that employers seeking the quality work force a supply of affordable housing will bring to the areas provide.
We therefore seek removal of the existing opportunity zone requirement that investments be a reinvestment of funds from a capital gain realized in the preceding 180 days provided the investment is for affordable housing through manufactured homes in opportunity zones. With this amendment any funds invested in affordable housing in opportunity zones should receive a stepped-up basis if the investment is held for ten years or longer. Legislatively, this could be achieved in a simple manner, by creating a short new subsection in the statute that would grant authority for this. We have attached a draft of our proposal.
With this change, we are confident that UMH Properties and other manufactured home community operators could access significant new investment funds to help build and modernize communities in opportunity zones nationwide that facilitate the most affordable housing option available, manufactured homes.
This approach is narrow and targeted. It would not facilitate investments that could be criticized as deviating from the objectives and intent of the Opportunity Zone program. It is limited to investments that facilitate affordable manufactured housing- a high priority for Congress and the Administration and an important public policy objective.
Finally, it would not allow investors to access the deferment and potential permanent elimination for capital gains that have already taken place. Since the latter is the most costly component of Opportunity Zone tax treatment and since the proposed flexibility is narrowly targeted to a specific limited activity, we believe the tax scoring cost of this provision would be very small, while the societal and economic benefits would be substantial.
I also understand that inflation is currently creating hardship for some resident homeowners in manufactured home communities due to rent increases and I’d like to address that issue based on my 47-year experience in the industry. The solution to the problem regarding newly built communities is to follow the Florida policy of requiring a prospectus from the community owner disclosing all potential fees and rent increases before a person purchases a home or moves it into a community. That prospectus coupled with a long-term lease that matches the term of the loan on the home results in fairness for the community owner and the resident. In the case of UMH new home buyers are offered a long-term lease, usually 20-25 years, that allows rent increases of CPI or 5%, whichever is more, plus pass through of increases in water, sewer, garbage and taxes. This results in reasonable rent increases that cause minimal to no friction between UMH and our residents. Except for the 2009-2011 period anyone who bought a home from UMH was able to sell it for more than they paid us for it, provided they properly maintained it.
Regarding existing communities there are laws on the books in most states prohibiting unconscionable rent increases. Further there is a covenant of good faith and fair dealing in all contracts. There are 43,000 existing communities and I am certain the problems you hear about pertaining to rent increases are coming from a very small percentage of those communities.
In closing, I thank the Committee for the opportunity to submit this statement and I would be happy to make myself available to Committee staff to discuss this initiative in more detail.
Summerhill Village Community in Mt. Pleasant, Mich., has been redeveloped and reintroduced to the area with the grand opening of a new community clubhouse and amenities center.
The community is owned by Four Leaf Properties, which since 2019 has been dedicated to the redevelopment, which included new homes, roads, and vital infrastructure. The vision for Summerhill is built around a high-quality, affordable lifestyle experience. With dozens of new residents and 100+ five-star reviews, the community is already a top choice for young families, singles and downsizers.
“The new clubhouse and recreational center is the crown jewel of FLP Life, our Four Leaf Properties resident lifestyle experience,” said Michael Callaghan, managing partner at Four Leaf Properties. “Great communities are built around great residents and those relationships grow through shared experiences and fun. We’ve invested and now Summerhill Village is a brand-new community like no other in the area. It’s with great pride that we open these facilities and continue offering new homes.”
Callaghan said the community’s first two phases have sold out, and the team currently is purchasing homes for the third phase.
The focal point of the reopening is a newly constructed 3,500-square-foot clubhouse built for community member events and activities that are free for Summerhill residents. Residents also can host private events at the facility at no charge.
Mt. Pleasant area charities and businesses may also choose to host events that are meaningful to residents, such as an adopt-a-pet event or health and fitness sessions.
Clubhouse and Amenity Center Details:
Beautiful gathering space with vaulted ceiling and skylights for parties and events
Flex space for classes (yoga, fitness, art, other)
Full kitchen
Coffee bar
Event lawn and patio area with professional landscaping
Summerhill Village is tucked away and surrounded by trees. It has a country feel but is close to many metro conveniences, minutes from Soaring Eagle Casino and Resort, Central Michigan University, Mid-Michigan College, Pleasant Hills Golf Club, and Indian Hills shopping center. The cities of Alma, Saginaw, Midland, and Grand Rapids are short commutes from Summerhill.
The James E Forrestal Building, Washington, D.C. offices for the U.S. Department of Energy.
The U.S. Department of Energy (DOE) has said it will delay the date of compliance for new manufactured home energy standards by 60 days after final standards are determined.
Previously, DOE had a May 31 deadline for enforcing the new standards.
The DOE stated it gave substantial weight to comment letters from MHI, and home builders Cavco, and Skyline Champion, as well as numerous state and regional manufactured housing associations including Alabama, Arizona, Florida, Indiana, Michigan, Minnesota, Mississippi, Nevada, New Mexico, New York, Ohio, Oklahoma, Pennsylvania, South Carolina, Tennessee, Virginia, Washington (NHA), Western Manufactured Housing Communities Association (CA), and Wisconsin). MHI said more than 500 campaign form letters were sent to the DOE at the institute’s urging.
Most organizations that sent communications to the energy department conveyed that the new standards would be unworkable and that the changes would create a price increase in home construction that runs counter to the industry’s offering as the largest form of unsubsidized affordable housing in the U.S.
MHI said in its statement on news of the 60-day delay that work remains to be done, and that it expects the DOE to complete its process for single-section homes in the fourth quarter of 2023 at the earliest. The compliance date will be extended to July 1, 2025 for all other homes, it said.
“We must ensure that HUD is the sole authority over manufactured housing construction to ensure an issue with conflicting standards from different agencies never happens again,’ MHI stated in its letter to members.
In mid-May, Rep. David Kustoff, a Republican from Tennessee, and Rep. Terri Sewell, a Democrat from Alabama, introduced H.R. 3327, the Manufactured Housing Affordability and Energy Efficiency Act of 2023. The bipartisan legislation clarifies and reaffirms the longstanding role of HUD as the sole regulator of federal manufactured housing construction standards.
Congress must hear from all sectors of the manufactured housing industry about the urgent need to change the statute, MHI stated. The action by the DOE affirms the importance of HUD’s role as the sole regulator for manufactured housing. Participate in MHI’s call to action and check back with MHInsider to keep up on the latest news from Washington.
Sam Zell, the late founder and chairman of ELS, speaks at the MHI Congress and Expo in 2006. Image by Lisa Stewart Photography.
Sam Zell, the renowned real estate magnate whose business acumen and pioneering spirit reshaped the landscape of the industry, passed away at the age of 81.
With an indomitable entrepreneurial spirit, Mr. Zell became a titan in the world of real estate, leaving an indelible print on the market and forever altering the dynamics of the sector.
He was born on Sept. 28, 1941, in Chicago, Ill. At a young age he exhibited a tenacious spirit and keen business acumen that set him apart from his peers. After graduating from the University of Michigan and later earning a law degree, Mr. Zell embarked on a remarkable journey that would define his legacy.
There was a breakthrough in the 1970s when Mr. Zell pioneered the concept of real estate investment trusts (REITs). Recognizing the potential for unlocking substantial value in underperforming properties, he founded Equity Group Investments, his investment firm, and spearheaded a wave of transformative acquisitions.
Mr. Zell founded Equity LifeStyle Properties, ELS, in 1984 and has been the chairman since 1995. His life story was detailed in his book “Am I Being Too Subtle”. In the book, he describes his introduction to manufactured housing and his pride in the accomplishments of the company.
“Sam leaves the real estate industry and the business community mourning the loss of a distinctive and generous mentor and an unparalleled leader who generously offered time and attention to develop those around him,” ELS President and CEO Marguerite Nader stated in a prepared company release. “He established an entrepreneurial culture focused on excellence, value creation, skilled and empowered teams and, most importantly, doing the right thing. He was a visionary who trusted his own sensibilities. Family was the cornerstone of Sam’s life. He will be missed as a husband, father, brother and grandfather.”
Mr. Zell’s ability to identify undervalued assets and implement innovative strategies catapulted him to the forefront of the commercial real estate sector.
Throughout his illustrious career, Mr. Zell’s influence extended far beyond the boundaries of real estate. With shrewd investments and bold decision-making, he amassed a vast portfolio spanning various sectors, from energy to logistics, cementing his reputation as a savvy businessman. He exhibited a knack for anticipating market trends and seizing opportunities.
Never one to shy away from risk, Mr. Zell’s move to acquire the Tribune Company made global headlines. Although the venture faced significant challenges, his unwavering resolve and tireless pursuit of success remained his most defining characteristic.
Beyond his professional achievements, Mr. Zell will be remembered for his charismatic personality and unwavering dedication to philanthropy. His philanthropic endeavors were as diverse as his business ventures, supporting causes including education, the arts, and health care. A passionate advocate for entrepreneurialism and fostering innovation, Mr. Zell established scholarships and mentorship programs to empower aspiring young minds.
Through the Zell Family Foundation, he led the sponsorship of several leading entrepreneurship programs, including programs at the University of Michigan’s Ross School of Business, Northwestern University’s Kellogg School of Management, Reichman University in Israel and the University of Pennsylvania’s Wharton School.
Mr. Zell’s direct nature, sense of humor, and pragmatism fueled his business approach and solidified his reputation as an iconic entrepreneur. His legacy will be the transformative power of strategic vision, determination, and a relentless pursuit of excellence.
Thomas Heneghan, former ELS CEO, has been serving as vice chairman and has been named to fill Mr. Zell’s role as chairman.
“Sam was uniquely comfortable being himself, even if it meant forging his own path,” Heneghan stated. “He was an incredible role model and made those around him better for the experience. His legacy speaks for itself and will echo well into the future.”
Donations in Mr. Zell’s name can be made to the Zell Entrepreneurship Program at the University of Michigan or the Zell Family Foundation.
More than 1,500 manufactured housing professionals are expected in Las Vegas April 7-9 as the Manufactured Housing Institute’s Congress and Expo returns to the...
With more homes, more exhibitors, and more buzz than ever before, the 2026 Biloxi Show is expanding, and fast.
The Biloxi Manufactured Housing Show &...
