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Regulatory Environment, Stages of Land Development, and New Technology

By
Contributing Writer
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stages of land development yale advisors gonzalez

By Mitch Gonzalez

Mitch Gonzalez, Yale Realty and Capital Advisors

The rise of manufactured housing began in the 1960s and continued as one of the predominant forms of housing developments until the late 1980s when local governments started to push back on adding more “trailer parks” to their cities. Zoning restrictions were enacted to prevent these kinds of developments in exchange for more dense housing such as apartments and condos. The real motivation behind these restrictions was more tax dollars from a “higher and better use” of the land. This basically translated into the higher you build, the more tax revenue you generate. As such, developers were highly incentivized to build this product type as government grants and tax breaks were plentiful during this time.

Ever since, these incentives have remained in place and local government officials have continued to preach “Not in My Backyard!” when it comes to allowing the development of manufactured housing communities.

‘Let Them Play’

Fast forward 30-plus years and the U.S. faces its biggest ever housing crisis. Housing prices have grown by 5, 10, even 20 times in some cities since the last wave of manufactured home communities were developed.

Labor and materials have become more and more scarce and expensive causing housing supply to leave a deficit estimated in the tens of millions nationwide. Affordable housing has become an oxymoron while all of these factors clearly point to the need for more manufactured housing.

Luckily, it seems like some governments are finally waking up.

Lawmakers in Arizona, Maine, Maryland, Massachusetts, and North Carolina are taking aim at local zoning restrictions against manufactured housing. Instead of using rent control, some states are looking to deregulate county and city zoning restrictions that prevent affordable housing; an attempt to switch the narrative to “Let Them Play!”.

Phases of Development

Over the last year, we have tracked over 15,000 sites being developed across Texas, Arizona, and the Southeast. As more investment moves into the space, we see land valuations rise as it progresses thru each stage of development. Understanding the stages of the development process and the value of each stage is very important.

First, there is “As-Is” — which is exactly what it seems — land with either no zoning or an agricultural designation. The fair market value of comps and makeup of the local regulatory environment weigh heavily on the valuation. Next, there is “Entitlement” — of which there are various levels. Limited Entitlements are used to describe areas without zoning within utility districts, whereas a project is Fully Entitled when the zoning and permitting of a project is complete. Today, in a market where lot rents are in the $500-$600/month, projects that are fully entitled are trading for $15k-$35k per lot. Then, there is “Build-To-Suit” — which comes into play once zoning and entitlements are completed. At this stage, a buyer has more autonomy over the development as long as it meets any setback or other zoning requirements. Savvy developers can set up a joint venture or partnership structure with larger equity groups. These deals can be structured as with a Right of First Refusal (“ROFR”) on the built asset or a more hands on JV structure that phases out the developers at checkpoints. Finally, there is “Stabilized” – which is the finished product from the development process. Developers that are trying to stabilize a property will need to make sure they can get an appropriate home allocation from a manufacturer. This will be crucial for bringing the community to stabilization. 21st Mortgage, Triad, Vanderbilt, and Cascade are chattel lenders that currently offer a competitive program for helping community owners finance inventory and end-users creatively finance the purchase of their homes.

New Tools for the Trade

As development is finally back in the MH industry, it is even more important that developers have the right tools to make these projects a success. If these communities are built the right way, more state and local governments should provide the necessary support for future manufactured housing developments. And since technology has changed so much since the last MH development wave, it is crucial that we use the availability of new technology to our advantage. Tools such as Land Vision, Zoneonomics, and Carta can be very helpful. Land Vision is a robust GIS mapping tool for zoning, parcel, flood maps, etc. It also allows you to upload your own maps, customizing the user experience. Zoneonomics is a great tool for looking “under the hood” of parcel zoning data. Zoneonomics is currently acquiring municipality data across many states and users can get 16 professional reports per month for $150. Finally, Carta helps GP’s manage LP interests and keeps the cap table organized. It is currently in beta stages for secondary trading market for LP interests. This could be the tool that provides liquidity for private equity markets.

Mitch Gonzalez is the director of land sales and development for Yale Realty and Capital Advisors, and previously ran a construction company providing general contracting services for brands such as Emcure Urgent Care, Jonna Properties, and Safeway Oil Company. Gonzalez has been the transaction manager on almost $70 million in closings, and now helps clients with land sales and development consulting.

JLT Reports Available for Manufactured Home Communities in Calif., Texas, Okla.

By
Patrick Revere
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cal texas oklahoma september 2022 JLT market reports
Friendly Village, a Newport Pacific manufactured home community in Anaheim Hills, Calif.

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 September 2022 mobile home park comps with occupancy and other vital data on manufactured home communities in California, Oklahoma, and Texas.

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 rent trends and statistics, marketing programs, and a variety of other useful management insights.

Datacomp maintains and provides 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.

The manufactured housing market data published in the September 2022 JLT Market Reports includes information on investment-grade manufactured home communities. Altogether, reports from the three states include data representations on 1,001 “All ages” and “55+” manufactured home communities with 205,549  homesites.

What’s in JLT Market Reports?

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

  • Number of homesites
  • Occupancy rates
  • Average community rents, and increases
  • California rent control and next increase data
  • Community amenities
  • Vacant lots
  • Repossessed and inventory homes, and much more

JLT Market Reports also include management insights that rank communities by the number of homesites, occupancy rates, and highest to lowest rents. Established reports show trends in each market with a comparison of September 2022 rents and occupancy rates to September 2021, as well as a historical recap of rents and occupancy from 1996 to the present date in most markets.

The September 2022 JLT Market Reports for Texas, California, and Oklahoma manufactured home communities 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.

Rent Butter Goes Well Beyond Credit Score

By
Patrick Revere
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rent butter talks with clients
Natalie Clark (right) and Claire Conti from Rent Butter talk with clients during an industry trade show recently in Arizona.

New Approach Allows Rental Applicants to Show All Sources of Income

Rent Butter wants its clients to rent better, streamlining internal leasing operations and enhancing the renter’s and community owner’s screening experience.

Company founders Chris Rankin, a developer, and Tom Raleigh, an attorney, had been working in multi-family housing, largely serving the middle market on Chicago’s west and south side. They were part of a real estate firm that grew from 100 to 10,000 apartments in five years and learned pretty quickly that they needed a more efficient way to screen and communicate with prospects and renters.

Truthfully, they had become somewhat accustomed to application acceptance on little more than a credit score, as well as a high volume of turnover and eviction. They were certain there was a better way.

“What are your biggest pain points? We interviewed 50 landlords and they all said the same thing,” Raleigh said. “How do I assess risk when the applicant’s credit score is really low… it made sense for us to tackle that issue.

“If they make stable income and make their rent payment on time, what does the credit score matter?” Raleigh asked.

A great majority of the people who apply have the ability to pay their rent, Raleigh said, but what Rent Butter customers are looking for is the willingness to pay.

“We call that the ‘Grit Factor’,” Raleigh said.

Rent Butter’s digital application runs on a mobile phone and gets approval from the applicant to share banking information with the owner looking to rent. It looks at instances of non-sufficient funds and overdrafts, it measures income stability, timely rent payments, and positive or negative trends in revenue and account balance.

“Really we give every landlord two reports,” Rankin said. “We give them the banking report, and credit behavior report. The real question is how they’re trending, not whether they have a 670 credit score but are they trending up to 720 or down to 550?”

“You can see the financial and credit trends are positive in this example,” he said. “The interface is easy to understand, and it really draws your eye to what’s important.”

They pull in info on defaults or late accounts that have yet to hit the credit score — 634 credit score six months later can be below 600 with a bad couple of months. All of the information flows into Rent Manager, for instance, and other large property management software solutions.

“The decades of hard work our industry has put into place has been very rewarding,” Raleigh said, for the property owner and management team, as well as the renter.

How Rent Butter Improves Resident Experience

“We make it really easy to apply,” Raleigh said. “Go on your phone and apply in five minutes.” The easier it is for someone to apply, the more applications the property owner will receive.

The more common rental application is five or six pages to look over. With Rent Butter, the applicant uploads an image of their ID card or driver’s license and completes the rest on their mobile phone in just minutes.

“Our ID verification tool is like airport technology at your property,” Raleigh said. “Their ID can be scanned and validated in real time.”

Pay stubs can be shared easily, and if no pay stubs are available, the user can provide secure access to their bank account.

“Connect your bank in real time, permission is granted and Rent Butter goes in to extract the needed data for the property owner,” Raleigh said. “It asks the applicant ‘Of all of these deposits, which ones are income?’ You click a box to confirm deposits that are earned income.

“Gig work and side hustles are included, so the applicant finally has a way to show their true income,” he said.

New Tech to Support Insurance Offerings

By
Patrick Revere
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insuretech supports industry home sales

By Adarsh Rachmale

Rachmale

During the past few decades, the world has witnessed technology advance at breathtaking speeds. Look at the first Apple Macintosh computer from 1984, and then look at the newest iPhone America’s pocket. An iPhone 12 has enough processing power to guide over a million Apollo spacecraft to the moon, simultaneously. Technology is advancing at an almost incomprehensible speed, and while it can be challenging to keep up, it’s facilitating innovation in every industry nationwide.

The manufactured housing industry is no different. Modern manufactured homes are full of smart technology to help homeowners save energy, time, and money. Lenders can take applications online and issue approvals in minutes. Home manufacturers engineer the home building process to keep quality high and prices low for American home buyers. Did you know that the amount of waste from the construction of one single-section home can fit into a trash can? Compare that to the typical site-built home, and you’ll see how well-engineered a manufactured home is. Just the concept alone, building a home in a factory on an assembly line, is more advanced than building a home on a building site, out in the elements. And though it may not be as glamorous as a new home rolling off the assembly line, property insurance has its share of technological advances as well.

The key components to a great insurance product are ease, simplicity, and value. All 3 of which can be improved with modern technology.

The Digital Application

With any financial product (insurance, lending, or otherwise), the hardest step for the consumers is the first step, the application. A financial application is long, requires lots of information, asks for uncomfortable information, and when finished, offers no reward because there is still the very real possibility of denial. Though it cannot eliminate the negative aspects of the process completely, technology can help insurance companies alleviate much of the pain of the application process and keep home buyers happy during their new home purchase.

Have you ever seen a home buyer look at a paper insurance application? Their eyes get wide as they stare at endless boxes (usually not large enough for the answer), long questions, tiny print, and seemingly 100s of “initial here” and “sign here” boxes. Technology in the smartphone insurance application all but eliminates that initial negative reaction. Conditional logic technology allows the application to ask for only the information it needs to make a decision based on that customer – this means no extraneous questions. The application also has fewer questions per page. Studies that there is a dopamine release from the sense of completion every time a user moves to another page on an application, which keeps them happy and moving forward.

The digital application also allows for much easier follow-up from the insurance company. If a customer took a paper application home and never finished it, no one would ever know, and no one would be able to check on the status of the incomplete paper application. In the case of digital applications, however, follow-up opportunities are endless. Because the application gives their contact information at the onset, insurance companies can follow up with incomplete applications, and proactively reach out to the applicant to help them complete their application. According to a study by Brevet, it takes five follow-ups with a customer before a sale is made. Technology allows insurance companies to do this more effectively, thus allowing for more sales.

Technology in Underwriting

Once the applicant has submitted their application, underwriting begins. This is the process by which the insurance company determines the amount of risk in the policy, and how to price the premium to account for that risk. Traditionally, this is a very labor-intensive process that involves looking at various actuarial tables, going back and forth with the customer, performing many calculations, submitting data to supervisors, and finally submitting a decision to the applicant. This process can take anywhere from a few days to many weeks. Because of the length of underwriting, many customers are lost, either to other companies or they simply lose interest and move on.

To help convert more applicants to customers, insurance companies use technology to significantly speed up the underwriting process. Data is instantly taken from the application, analyzed, and sent to the underwriter. There are no manual calculations or need for various actuarial tables. The computer takes care of all of that. Advanced algorithms look at hundreds, if not thousands, of variables and determine risk with much more detail and accuracy than a human ever could. This is especially beneficial for manufactured housing because the underwriting algorithm can account for the unique profile of manufactured housing risk, which a human oftentimes cannot. The technology in insurance underwriting allows for a better insurance product for manufactured homeowners. Modern insurance companies, like CoverTree out of Michigan, are working tirelessly to create technologically advanced insurance products specifically tailored to manufactured homeowners, giving the manufactured housing industry a quality insurance product to go with its high-quality, high-value, homes.

Claims Processing Technology

And finally, there is the technology in the claims process. Most insurance customers will never reach this stage. But if they do, there is technology available to make filing a claim much less difficult than it has been traditionally. Modern insurance companies all have smart phone apps that allow the customer to file a claim, upload photos/video, even do virtual inspections with a claim adjuster. Technology also allows for much faster funds disbursement. Experiencing any sort of loss or damage to a home can be one of the most stressful times in someone’s life, and technology in the claims process makes that time less stressful.

AI – The Next Step in Insurance Tech

What’s next? Like every other industry, Artificial Intelligence (AI), also known as machine learning, is set to make a huge impact in the insurance space. Insurance AI will be able to analyze millions of data points in real-time and adjust policies and premiums for constantly changing variables. Smart insurance companies can learn from their customers’ losses and benefit from data-network-effects to improve pricing and experience moving forward. This will be a huge win for the manufactured housing industry. While human underwriters may come with biases towards manufactured homes, a machine will be able to see the material benefits without the inaccurate, outdated stigma associated with a manufactured home. The future of housing is a manufactured home, and we look forward to seeing insurance technology play a key role in the growth of the manufactured housing industry.

About the Author: Adarsh Rachmale is the co-founder and CEO at CoverTree, the first and only insurtech focused on middle America and manufactured homes. CoverTree offers state-of-the-art rating, data-driven pricing, and first-time residents can go online and completely purchase a policy in three minutes without having to talk to anyone.

U.S. Home Values Rise 4% from First Quarter, Up 17.7% for Year

By
Patrick Revere
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national home values increase
Anaheim Shores, Anaheim, Calif., courtesy of Newport Pacific.

Corelogic Case-Shiller Index Slows in June

U.S. house prices rose 17.7 percent from the second quarter of 2021 to the second quarter of 2022, including a 4 percent quarter-to-quarter hike, according to the Federal Housing Finance Agency House Price Index.

FHFA’s seasonally adjusted monthly index for June was up 0.1 percent from May.

“Housing prices grew quickly through most of the second quarter of 2022, but a deceleration has appeared in the June monthly data,” FHFA Supervisory Economist in the Division of Research and Statistics William Doerner said. “The pace of growth has subsided recently, which is consistent with other recent housing data.” 

Significant Findings from FHFA’s Recent Report

  • Nationally, the U.S. housing market has experienced positive annual appreciation each quarter since the start of 2012.
  • House prices rose in all 50 states and the District of Columbia between the second quarters of 2021 and 2022. The five areas with the highest annual appreciation were: 1) Florida 29.8 percent; 2) Arizona 25.5 percent; 3) North Carolina 25.2 percent; 4) Montana 24.9 percent; and 5) Tennessee 24.3 percent. The areas showing the lowest annual appreciation were: 1) District of Columbia 5.2 percent; 2) North Dakota 10.6 percent; 3) Louisiana 10.8 percent; 4) Minnesota 11.3 percent and 5) Maryland 12 percent.
  • House prices rose in all of the top 100 largest metropolitan areas over the last four quarters. Annual price increases were greatest in North Port-Sarasota-Bradenton, FL, where prices increased by 36.4 percent. Prices were weakest in Washington-Arlington-Alexandria, DC-VA-MD-WV (MSAD), where they increased by 9.1 percent.
  • Of the nine census divisions, the South Atlantic division recorded the strongest four-quarter appreciation, posting a 23 percent gain between the second quarters of 2021 and 2022 and a 5.2 percent increase in the second quarter of 2022. Annual house price appreciation was weakest in the West North Central division, where prices rose by 13.9 percent between the second quarters of 2021 and 2022.

The FHFA HPI is the nation’s only collection of public, freely available house price indexes that measure changes in single-family home values based on data from all 50 states and over 400 American cities that extend back to the mid-1970s. The FHFA HPI incorporates tens of millions of home sales and offers insights about house price fluctuations at the national, census division, state, metro area, county, ZIP code, and census tract levels. FHFA uses a fully transparent methodology based upon a weighted, repeat-sales statistical technique to analyze house price transaction data.

FHFA releases HPI data and reports on a quarterly and monthly basis. The flagship FHFA HPI uses seasonally adjusted, purchase-only data from Fannie Mae and Freddie Mac. Additional indexes use other data including refinances, FHA mortgages, and real property records. All the indexes, including their historic values, and information about future HPI release dates are available on FHFA’s website: https://www.fhfa.gov/HPI.

Corelogic Case-Shiller Index Slows in June

S&P Dow Jones Indices released the latest results for the S&P CoreLogic Case-Shiller Indices, the leading measure of U.S. home prices. Data released for June 2022 show that home prices continue to increase across the United States.

The National Home Price Index, covering all nine U.S. census divisions, reported an 18 percent annual gain in June, down from 19.9 percent in the previous month. The 10-City Composite annual increase came in at 17.4 percent, down from 19.1 percent in the previous month. The 20-City Composite posted an 18.6 percent year-over-year gain, down from 20.5 percent in the previous month.

Tampa, Miami, and Dallas reported the highest year-over-year gains among the 20 cities in June. Tampa led the way with a 35 percent year-over-year price increase, followed by Miami in second with a 33 percent increase, and Dallas in third with a 28.2 percent increase. Only one of the 20 cities reported a higher price increase in the year ending June 2022 versus the year ending May 2022.

Charts below compare year-over-year returns of different housing price ranges for Tampa and Miami.

MHInsider is a product of MHVillage, the largest marketplace or mobile and manufactured housing, with listings for more than 43,000 manufactured home communities. Bookmark MHInsider for all of your manufactured housing news.

One Historic Night at the Hall

By
Patrick Revere
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Historic night hall of fame elkhart

Manufactured Housing Professionals Gather to Honor New Inductees, Celebrate 50th Year, New MH Museum

The RV/MH Hall of Fame in Elkhart, Ind., is celebrating multiple historic achievements in August, inducting 10 new honorees in its 50th year, as well as unveiling the much-anticipated Manufactured Housing Museum.

Induction dinner guests this year received a special treat with the grand opening of the 21,000 square foot Manufactured Housing Museum, RV/MH Hall of Fame President Darryl Searer noted.

“This museum winds through time from the industry’s origins, through the present day, and finishing with tomorrow,” Searer said.

The museum is highly educational on everything the industry has to offer and features an immersive and interactive experience that takes the Hall of Fame’s new museum from being an attraction to a destination.

The new Clayton CrossMod manufactured home can be seen on the exterior of the Hall of Fame in the image to the left.

Origins of the Hall of Fame

The RV/MH  Hall of Fame was formed in 1972 by a group of industry magazine publishers, and during the ensuing years has been able to grow from a small library to a 40-acre campus featuring an RV Museum with 60 one-of-a-kind recreational vehicles, the new interactive manufactured housing museum, the world’s largest industry library, a hall dedicated to Go-RVING, an exhibitor’s hall, and the Hall of Fame. A 36,000 square foot convention hall is underway for the Northern Indiana Event Center, which already has a pair of halls providing 24,000 square feet of space, and a 250-unit multi-purpose rally/show site that also is a one million square foot parking lot with a 20,000 square foot climate-controlled pavilion at the center.

Induction Dinner Honorees in Manufactured Housing

David J. Carter Sr. – Supplier, Florida

Dave Carter in 1986 sold a lumber yard and an electrical supply business to concentrate on Dave Carter & Associates, supplying the electrical and building product needs of the manufactured housing industry. In three years he took DCA from a regional provider to a national supplier with a dozen distribution centers. In 1993 the business added plumbing products, diversified into RV in 2008, and helped rebuild the manufactured housing industry during its 15+ year recent era of growth. DCA was named MHI Supplier of the Year in 2011, and Dave Carter continues to advocate for affordable housing on the local, regional, and national levels.

Harry Karsten – Manufacturer, California

Harry Karsten built The Karsten Co. and Karsten Homes into a West Coast powerhouse. It was founded in 1995 and built its workforce to more than 700 people, including a couple hundred at the homebuilding facility at its plant near Mather Airport in Sacramento. The company expanded from California to other homebuilding sites in Albuquerque, N.M., Stayton, Ore., and Breckinridge, Texas. At the time it was purchased by Clayton in 2005, the facilities were putting out better than 1,700 homes a year in 14 states in the West and central United States.

Raylen Gritton – Dealer, California

Ray Gritton has been in the manufactured housing industry for more than 40 years. He started his first dealership in Modesto in the 1970s and has worked for large corporations in charge of hundreds of dealerships. He currently owns 13 locations in five states. Gritton has won multiple awards and has served on boards for state and national industry associations.

Tim Williams – Finance/Lender, Tennessee

Tim Williams had a long, productive, and diverse career in manufactured housing even prior to co-founding 21st Mortgage in 1995. As CEO of the organization, he has been instrumental in providing improved financing for affordable homes across the country as well as growing 21st into one of Knoxville’s largest employers. In addition to his efforts in Tennessee, Williams has been a tireless advocate for manufactured housing in Washington, D.C., and nationwide.

Eugene W. Landy – Communities, New Jersey

Eugene Landy is a founder and current chairman of the board for UMH Properties, Inc., a publicly-owned REIT in the ownership and operation of manufactured home communities. He is a graduate of the U.S. Merchant Marine Academy as well as Yale Law School, where he served for many years on the board of advisors. UMH, now operated by Eugene’s son, Sam, has a portfolio of 127 manufactured home communities with about 24,000 developed homesites. These communities are located in New Jersey, New York, Ohio, Pennsylvania, Tennessee, Indiana, Michigan, Maryland, Alabama, and South Carolina. UMH also owns and operates one community in Florida through its joint venture with Nuveen Real Estate.

RV Inductees

Mark Ferkey – Dealer

Donald Gunden – Manufacturer

Veronica Hepp – Dealer

Lewis Shaum – Supplier

What Awaits Behind the Curtain of the New Scoular Museum?

The Manufactured Housing Museum is now open, an experience made possible by many individuals, most notably the museum’s namesake Jim Scoular, who donated to the effort in honor of his father, Ralph, who preceded him in the industry and as a member of the Hall of Fame.

The museum is a linear historical journey through time and into the future of manufactured housing, beginning with covered wagons on the American frontier and viewing the future of housing from a rather surprising vantage point.

The journey includes an appeal to all of the human senses, from crickets in the night to the aroma of fresh-cut grass, and a gentle breeze at your back. Veteran museum, zoo, and theme park designer Thomas Landgrebe left not a single trick on the table in the effort to create a remarkable experience in time and place.

“I appreciate so much what everyone who works here has done,” Jim Scoular, a South Dakota industry professional, said of the efforts in Elkhart, Ind. “It’s a dream come true for the industry, and it all comes back to the leadership here. It’s tremendous.”

With the addition of the new museum to complement its existing offerings, Searer said he anticipates annual visits to exceed 100,000. In the last 10 years the venue has matured from a hall, meeting space, and library valued at $500,000 to a much larger event space with two museums, a large outdoor rally site and pavilion, and the two museums now worth about $22 million.

“We’ve come a long way in a short period of time,” Searer said.

Among those who havee toured the hall was Joe Viglione, of Fairmont Homes, which donated the first modern home to the museum, jumpstarting subsequent donations and partnerships that have made the effort a success.

“This addition to the hall is a great thing for our industry,” said Kim Schultz-Rainford, who owns communities in Texas.

George Allen, a former community owner and consultant in manufactured housing, continues to write about industry advances and is a longtime supporter of the hall of fame.

“I have waited 44, the sum of my career, to see what I saw today,” Allen said following the sneak peek museum tour. “I am very impressed.”

MHInsider, the leading news source for manufactured housing professionals, is a product of MHVillage – the top marketplace for manufactured homes.

Rents Increase Moderately, Occupancy Steady in Southern California Manufactured Home Communities

By
Patrick Revere
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california occupancy rent
Orange Mobile Home Park, a Cal-Am property.

August 2022 JLT Reports for mobile home rent comps, occupancy, and other vital data from manufactured home communities in Southern California show moderate rental increases and steady occupancy rates across six counties.

JLT Market Reports provide detailed research and information on communities in 186 housing markets throughout the United States. These include the latest rent trends and statistics, marketing programs, and a variety of other useful management insights.

Datacomp’s August 2022 release of JLT Reports in Southern California includes information on Los Angeles, Orange, Riverside, San Bernardino, San Diego, and Ventura counties. Datacomp maintains and provides 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.

August 2022 manufactured housing market data published in JLT Market Reports for Southern California include information on 503 “All ages” and “55+” manufactured home communities.

Altogether, the reports from Southern California manufactured home communities include data representations for 101,863  homesites.

Regional Trends in Manufactured Housing Community Rent

  • Pacific region manufactured home communities show a year-over-year 5.1 percent increase in rent for retirement communities and a 6.3 percent increase for all-ages communities.
  • Pacific region manufactured home communities show a year-over-year 0.1 percent increase in occupancy for retirement communities and a 0.1 percent increase in occupancy for all-ages communities.
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
  • California rent control and next increase data
  • Community amenities
  • Vacant lots
  • Repossessed and inventory homes, and much more

JLT Market Reports also include management insights that rank communities by the number of homesites, occupancy rates, and highest to lowest rents. Established reports show trends in each market with a comparison of August 2022 rents and occupancy rates to August 2021, as well as a historical recap of rents and occupancy from 1996 to present date in most markets.

The August 2022 JLT Market Reports for Southern California manufactured home communities 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.

U.S. Rep. Jackie Walorski Killed in Automobile Crash

By
Patrick Revere
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jackie walorski crash death response
U.S. Congresswoman Jackie Walorski, R-Ind.

The death of U.S. Rep. Jackie Walorski, killed in a car crash on 119 near Elkhart Aug. 3, has left the northern Indiana area, and friends and colleagues nationwide, stunned and grieving at the loss.

Walorski, 58, had served Indiana’s 2nd district in the U.S. House of Representatives since 2013.

“We are deeply saddened by the tragic loss of Congresswoman Jackie Walorski and her two congressional staffers, Zach Potts and Emma Thomson”, Ron Breymier executive director of the Indiana Manufactured Housing Association – Recreation Vehicle Indiana Council said.

The association worked closely with the congresswoman in Washington and during her tenure in the Indiana House of Representatives.

“Jackie was a tireless public servant who cared deeply for her constituents, the State of Indiana, and our nation,” he said. “Jackie was a strong advocate for the RV and manufactured housing industries. She recognized the importance of the jobs created and took pride in promoting affordable housing and recreational opportunities for Americans.”

Vice Chair of the St. Joseph County Republican Party Susan Baxmeyer described the congresswoman as larger than life, possessing an infectious personality that captured attention.

“Congresswoman Walorski was a fierce advocate for her district,” Baxmeyer said. “Never once was she without a smile, or a kind word, or a rousing and inspiring message. She poured her heart and soul into each day’s work.

“And while this district is losing an incredible representative, the bigger loss is that of a loyal friend.”

Walorski served in the state capital from 2004 through 2010 and won again in 2012.

A cause for the crash is undetermined. Some reports indicate the driver of Walorski’s vehicle may have crossed the centerline prior to the collision. However, the investigation is ongoing.

Manufactured Housing Institute Chief Executive Officer Lesli Gooch offered condolences to the families of those involved in the crash, reminding that Walorski and her colleagues dedicated their lives to finding solutions to the challenges that face the country.

“I am so very saddened to hear of the passing of Congresswoman Walorski, her District Director Zachery Potts, and Communications Director Emma Thomson,” Gooch said.

“Congresswoman Walorski was a dedicated and effective public servant and we appreciate her support of manufactured housing as a part of her work to expand the American dream of homeownership to more people,” she said. “Her lasting impact supporting families, workers, and small businesses will be felt by both those she knew personally and the countless others whose lives she impacted through her public service.”

Potts, the driver, 27, was the chairman of the St. Joseph County Republican Party, and Emma Thomson, 28, Walorski’s communications director, were killed in the crash. The fourth fatality was the driver of the other vehicle, Edith Schmucker, 56, of Nappanee, who was traveling alone south on state route 19 just beyond Wakarusa about 12:30 p.m.

Mark Bowersox is the president of MHI, and previously worked for the Indiana association in support of the manufactured housing and RV industries where each industry holds great local value as well as a national presence.

“For years, I witnessed Congresswoman Walorski’s support for manufactured housing, first as an Indiana state lawmaker and then as a congresswoman. She will be remembered by this industry for her unwavering commitment to making the lives of Americans better by helping them achieve homeownership in quality manufactured housing,” Bowersox said. “We will miss her and we extend our deepest condolences to her family and the families of her exceptional staff members who died supporting her important work. We are grateful for their public service and support for the American dream.”

Walorski grew up in South Bend, Ind., and was a reporter for the local CBS affiliate in the middle to late 1980s. She served at Ancilla College as the director of institutional advancement, and as director of membership at the St. Joseph County Chamber of Commerce, director of annual giving at Indiana University South Bend from and then moved to Romania start Impact International, a foundation to provide medical supplies and attention to impoverished children.

Indiana law states it is the charge of local Republican officials to pick a candidate to replace Walorski on the general election ballot. Republican Gov. Eric Holcomb also has the power to schedule a special election for someone to address Walorski’s current term.

MHInsider is a product of MHVillage and the primary source for manufactured housing news.

Research Looks at Relationship Between Zoning, Supply Gap

By
Dennis Smith
-
mh zoning research
ChoiceHome
Dennis Smith, Affordable Lending Manager for Single-Family Lending and Access to Credit at Freddie Mac.

Manufactured housing currently makes up 9 percent of single-family new home starts — a figure that has steadily declined since its peak of 25 percent in 1996, according to U.S. Census data. While several factors are driving that downtrend trend, a portion is related to zoning regulations at the state, local, and even homeowners’ association (HOA) levels which affect the location and number of homes that can be built.

If manufactured homes were more widely accepted, they could play a role in chipping away at the 3.8 million-unit housing deficit, shrinking the affordability gap and promoting a more equitable housing landscape. A more inclusive approach could make that happen.

Overcoming Misconceptions — and Promoting Benefits — of Manufactured Homes

Compelling Features of Factory-built Homes Make Them a Smart Option for Many Homebuyers:

  • These dwellings are attractive, energy-efficient, safe, and able to stand up to natural events including inclement weather and fire, as they must comply with the U.S. Department of Housing and Urban Development.
  • Manufactured homes provide an average cost savings of up to 50 percent compared to their stick-built counterparts, up to $55 per square foot excluding land versus $114.
  • Construction is precise and efficient thanks to technology and large-scale, factory-based work, and onsite work is less disruptive to the neighborhood as it’s shorter than for stick-built homes.
  • They are environmentally friendly, as minimal waste remains after construction of a manufactured home.
  • Mortgages on manufactured homes perform nearly as well as those on site-built homes, and both categories appreciate at about the same rate.

However, zoning restrictions enacted by many state and local jurisdictions and rules applied by some HOAs discourage the purchase and placement of manufactured homes.

Manufactured homes are often restricted to designated parts of town, subject to stringent regulations including those tied to the age of the house, or banned outright

Standards related to design and building materials make manufactured homes ineligible in certain neighborhoods, while lot-size minimums and parking-space requirements drive up land prices. 

Administrative processes and fees also increase cost, risk, and time to market. Moreover, persistent misconceptions about manufactured homes being unsafe, unattractive, a bad investment, and driving down surrounding property values, coupled with negative assumptions about their residents, have kept this category on the fringe in many markets.

Government Support, Industry InitiativesContinue to Move the Needle

HUD has long been a governmental champion of safe, affordable, and well-built manufactured homes. In 2019, the agency hosted the Innovative Housing Showcase, constructing and placing factory-built homes on the National Mall to highlight their features and amenities. States including Arizona, Arkansas, California, Kentucky, New York, and Washington are engaging in proactive approaches to promote their acceptance by relaxing or removing restrictions and encouraging inclusion. Since 1980, Oakland, Calif., has permitted manufactured homes on a permanent foundation in all residential areas. Washington state requires that manufactured homes titled as real property be treated the same as site-built structures.

Incorporating steps like these elsewhere could open the doors to homeownership for more U.S. households. The industry can play an important role in dispelling myths about manufactured homes and promoting their wider adoption, helping move the category forward, by:

  • Holding regionally focused events where manufacturers and those in the lending ecosystem convene to learn more about design aesthetics and how factory-built homes can fit into local communities, using successful examples from other areas.
  • Rethinking the way manufactured homes are sold. Placing them in developments versus on retail lots showcases how they organically fit alongside other homes and neighborhood features.
  • Educating appraisers on best practices when developing the appraisal of a manufactured home.
  • Encouraging manufacturers to design exterior elements, including roof pitches, garages, porches, and trim, that are as aesthetically pleasing as interior ones. Selecting a low profile or ground-set foundation allows the structure to more closely resemble a site-built home than a pier and beam foundation, widening the appeal to more potential customers.

Freddie Mac has been working to support manufactured housing through Duty to Serve, including growing the volume of manufactured home loan purchases 85 percent between 2018 and 2020, and expanding the types and uses of manufactured homes eligible for financing.

Access the research paper by doing a web search for “Freddie Mac manufactured housing zoning research”.

These and other initiatives are helping to transform the industry and highlight manufactured housing for what it truly is — an affordable and attractive choice for a large swath of homebuyers.

Dennis Smith is an affordable lending manager in the Single-Family Client and Community Engagement division. He manages the affordable housing preservation and manufactured housing initiatives that support Freddie Mac’s underserved markets plan.

Building a Better Neighborhood

By
Suzanne Felber
-
Building a better neighborhood felber lifestylist manufactured housing

It is actually happening. The years or even decades of hard work that our industry has put into educating consumers about the value of manufactured housing is finally paying off.  Consumers and even some cities are realizing that today’s manufactured homes are not the mobile homes of the past.

Recently my own neighborhood that used to be full of diverse, hard-working families has landed on the radar of developers and house flippers. Being close to downtown Dallas, and within blocks of a rail system station has made it a perfect target for building large, multi-family structures. It has made us form neighborhood organizations and get involved in city politics, including inviting city planners to come and speak to our group.

When a meeting happened recently, the discussion came up about ADUs and tiny homes. When the city planner started describing them as “mobile homes” I raised my hand and kept it up until I was allowed to speak. I shared how instead of us being forced out of our homes by large developers that wanted to build tall, apartments, townhomes and condos, we had other options. Allowing ADUs or tiny homes in the city limits could be a great alternative along with factory-built cluster homes, or other higher density, single-family options. I always have examples of our homes on my phone and offered to share with and educate anyone interested, including the city council and planning committee. All were interested, and I fielded lots of questions. By the end of the meeting, there was interest instead of a flat no.

With the homes that our industry is building today, we are a viable option for infill and affordable housing, right alongside site-built homes in affordable housing neighborhoods. One of the planners in attendance actually asked what it would take to get more RV or tiny home parks built nearby, and in some areas that is actually happening.

An Industry That Works for the Customer

YES! Communities is in the process of building a new community from the ground up in New Braunfels, Texas. Dwelling at New Braunfels has been designed to not only attract customers that have been familiar with factory-built housing for years, but to be a viable, possibly preferred option for the new and younger customers, particularly the emerging tech workforce in nearby Austin and San Antonio. The Denver-based company hopes to help change the perception of community living by offering a healthier lifestyle with their native wetland plantings, a loop trail, pond, and signature pier. The amenity center clubhouse will be three linked buildings with a modern, simple feel. Designing thoughtful homes and communities based on local preference, not just a national directive, is becoming more important than ever.

State-of-the-art fitness centers, splash parks, golf simulators, pickleball, and jogging paths are some of the ways that communities are encouraging a healthy lifestyle that appeals to today’s community customers. Pride in community, and allowing those customers to know that they are an important part of a community or neighborhood is a vital consideration. Manufacturers and community owners aren’t waiting for the customer to come to them, they are going out into the wider community and meeting potential customers in their own environments.

Innovation and Technology to Meet Needs

Consumers today have a shorter attention span than ever, so it is critical to come up with unique ways to get the information they want as quickly as possible. Clayton Homes is using QR codes in their new MIYO homes that offer a flex space in each home. Instead of relying on the sales team to tell about the features of the homes, customers can quickly scan the code in various areas of the homes. They can then learn by a short video about what is special, or be taken to a page on their website.

Having great photography of your homes is also very important, and having the 3D tours available online is now expected by consumers so they can tour your homes at their leisure instead of having to drive all over town to see a home that they like. This technology has become a lot more affordable, and it is now possible for smaller builders and retail centers to rent the equipment and technology to do this in their own homes.

‘Micro’ is the Buzz

It looks like “micro” might become the buzzword for 2022. Micro kitchens, micro homes, and micro-communities are something that today’s home buyers and renters are Googling, and searching out. Blomberg Appliances is a company that you may not ever have heard of, but you may have used in an apartment, or hotel suite that you have stayed in. Their “micro appliances” could be the perfect fit for today’s smaller homes, and are also ideal for creating cooking and entertaining areas outside of the traditional kitchen space. This company is also very focused on sustainability and recently showed at the Kitchen and Bath Industry Show some very exciting innovations coming to market.

Casata is a new micro home rental community that has purchased land in Dallas and other areas to replicate its success in Austin. The group is about sustainability, community living, and being able to live large in a small space. Its leadership is concerned about the social impact of their community as well as the lifestyle they make available to their customers. Their website shares that their impact focuses on two key pillars: sustainability and the arts.

The community is packed with amenities that encourage consumers to enjoy and share the entire community, not just their personal homes. From dedicated food truck areas, to free live music events, and top-notch concierge services available through their designated app, this design is one to watch. Casata Austin was designed for using factory-built construction of their homes, and they are considering this type of construction for the new communities as well.

Having a walkable, bike-friendly neighborhood has become a priority for many of the consumers looking to buy or rent a new home. This is true not only with the younger buyers, but for the 55+ customers as well. In the last two years, we have realized that the more we can do at home or nearby instead of having to drive everywhere can make a difference in our lives and to the planet.

By being a better neighbor, and welcoming new ideas and innovations into our communities, we can build a better neighborhood and a future that is brighter for all of us.

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