A new Clayton Homes model built during 2018 in Maynardville, Tenn., is shown during The Louisville Show in January 2019.
18 Clayton Homebuilding Facilities Get ENERGY STAR® Certified Homes Market Leader Awards
Clayton Home Building Group, one of America’s largest off-site and on-site home builders, has been recognized by the U.S. Environmental Protection Agency (EPA) as a 2019 ENERGY STAR Certified Homes Market Leader for its outstanding commitment to energy-efficient new homes through the ENERGY STAR program in 2018 at 18 of the company’s home-building facilities dedicated to constructing off-site built homes.
The Market Leadership Award recognizes the facilities’ continued commitment to providing homebuyers with ENERGY STAR certified homes nationwide.
Clayton Home Building Group
Clayton’s home-building facilities recognized in the manufactured housing category include:
Appalachia
Buckeye
Maynardville
Nashville
Oxford
Perris
Rutledge
Savannah
Sulphur Springs
Waycross
Albany
Giles
Hermiston
Richfield
Rockwell
TRU Belton I
TRU Halls
TRU White Pine
“We are truly honored to have 18 of our home-building facilities receive this award,” said Clayton Home Building Group Vice President of Engineering and Design Mark Ezzo. “Our goal is to continue to find ways to help our homebuyers save money by utilizing energy-efficient building practices and materials that can reduce the cost of utilities, while also helping the environment.”
In 2018, over 3,000 Clayton off-site built homes were ENERGY STAR certified. ENERGY STAR aligns well with one of Clayton’s guiding principles, that of “we will leave the world and company a better place“. The certified homes include location-specific requirements for construction and installation.
Energy Star Home Features Include:
Airtight ducts
Efficient heating and cooling equipment
Increased insulation
Efficient hot water heaters
Low emission windows
A new Clayton home at The Louisville Show in January 2019, built during 2018 at the Maynardville, Tenn., facility.
Clayton’s mission is to provide quality, energy-efficient homes and appliances for families across the nation. The company’s 40 home-building facilities continue to push the boundaries on attainable housing for all income brackets using the best off-site construction methods. Every Clayton home-building facility is ISO 14001 registered for green construction practices, and together in 2018 they diverted over 21,000 tons of waste from landfills through recycling and waste management.
Each year, the ENERGY STAR Residential New Construction program presents Market Leader Awards to outstanding partners who have made important contributions to energy-efficient construction and environmental protection by building or verifying a significant number of ENERGY STAR certified homes and apartments, or by sponsoring a local program that supports these activities during the previous year.
More than 98,000 ENERGY STAR certified single-family homes and multifamily units were built in 2018; nearly 2 million homes since 1995.
JLT Market Reports Available for Immediate Download
Datacomp has published its July 2019 manufactured home community rent and occupancy reports for Colorado, Delaware, New Jersey, and Wyoming.
JLT Market Reports provide detailed research and information on communities in nearly 180 major 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 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.
July 2019 manufactured housing market data published in JLT Market Reports for Colorado, Delaware, New Jersey, and Wyoming include information on 241 “All Ages” and “55+” manufactured home communities.
Altogether, the reports on the four states’ manufactured home communities include data representations for 63,279 homesites.
“The four states represented in the July 2019 publication of the JLT Market Reports are recording growth in occupancy and average adjusted rent across the board, except for one small dip in occupancy rate in the Wyoming market,” Datacomp Co-President and Chief Business Development Officer Darren Krolewski said.
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 information includes:
Number of homesites
Occupancy rates
Average community rents, and increases
Community amenities
Vacant lots
Repossessed and inventory homes, and much more
JLT Market Reports include management insights that rank communities by number of homesites, occupancy rates and highest to lowest rents. Established reports show trends in each market with a comparison of July 2019 rents and occupancy rates to July 2018, as well as a historical recap of rents and occupancy from 1996 to present date in most markets. Some reports include information on rent control and next increase, if applicable.
Each fully updated report for mobile home communities is a comprehensive look at investment-grade properties within a market, enabling owners and managers, lenders, appraisers, brokers and other organizations to effectively benchmark those communities and make informed decisions.
James Dougherty, developer and owner of The Bluff on Manistee Lake in Michigan, provides a presentation during the 2018 Networking Roundtable on measures that go into opening a new community.
Networking Roundtable Returns to The Alexander in Downtown Indianapolis
The 28th Annual Networking Roundtable for manufactured housing professionals will take place at The Alexander in Indianapolis, Ind., Sept. 8-10.
The Networking Roundtable is the ideal gathering for industry professionals to receive a hands-on, timely education on every aspect of operating or property management for a manufactured housing land-lease community.
Programming for the gathering includes presentations, panels and discussions with some of the leading professionals in the business. A keynote address from U.S. Senator Todd Young, from Indiana, will get business underway the opening morning of the Roundtable.
“Senator Young being in Indianapolis to speak to our industry is yet another clear sign of the elevation of manufactured housing in D.C. as a solution toward solving the affordable housing crisis in our country,” event organizer Erin Smith said. “We appreciate the Senator’s willingness to appear at the 28th Networking Roundtable, as well as his continued support for our industry and the Indiana workforce that is so vital to what we do.”
Jose Villareal, left, and Ben Navarro, of Fannie Mae, and Griffin Cotter, from Freddie Mac, field questions from Roundtable attendees.
Networking Roundtable Preliminary Schedule
Attendees of the 2018 Networking Roundtable in Indianapolis take in a presentation from Joe Stegmayer, an industry veteran and executive for Cavco Industries.
Education and professional networking at the Roundtable will feature topical talks on community management, finance, sales, technology, and community acquisition. Speakers include Dave Reynold of Impact MHC, Michael Callaghan of Four Leaf Properties, Paul Bradley of ROC USA and event founder George Allen of EducateMHC.
In addition to the two days of official programming, Allen will greet early arrivers for an open conversation and networking reception on Sunday, Sept. 8. EducateMHC also will host a Manufactured Housing Manager certification class on Sept. 11. Registration for the MHM class is separate from event registration.
A full schedule for the 28th Networking Roundtable will be announced in mid-summer.
For the third consecutive year, the Networking Roundtable will be held at The Alexander in downtown Indianapolis. The Alexander offers premium conference space, as well as ideal accommodations for manufactured housing professionals traveling to the event.
Manufactured Home Community Upgrades Benefit the Industry as a Whole
One of the most difficult issues facing the manufactured housing industry today is the presence of many older, unattractive land-lease communities on the nation’s landscape.
Upgrading and improving these communities is important for several reasons. From an industry perspective, the negative impact these communities have on efforts to rezone land for future projects is legendary.
The “trailer park” image of some of these older communities often is the biggest argument against proposed modern community developments. From an investor perspective, many of the older developments are losing value because of their inability to accommodate newer, larger homes. And the negative image created by the aging asset is damaging for everyone.
How Do We Go About a Community Makeover?
Level I Renewals
So, how do we go about making a change for the better in these older communities?
The first step in the process is deciding the extent of the makeover. The activity could be as simple as a cosmetic enhancement of the existing facility. Or it could be as complex as a complete retrofit. This would require the removal of the existing homes and a planned redo of the community and infrastructure, which would accommodate newer, larger homes. This initial decision will determine the course of the actions to follow.
For decades, our firm has prepared upgrade documents for many projects, large and small, across the country. All of the projects have begun with a thorough assessment of the community. The first step in the process is the accumulation of the most complete maps and information on the community possible. In many cases, this involves digging deep into office closets, calls to the design engineer or planner or trips to the municipal or state agency to acquire archived copies of the approved construction plans. Conversations with managers and maintenance personnel further complete the base plans.
Often, drawings are unavailable. However, aerial photographs from government sources can be used to create base maps. Thorough site inspection and verification will complete the process.
Northville Crossings, a Sun Community in Michigan.
A Picture is Worth a Thousand Words
Walk the site with a camera and notepad in hand. Photographs have a way of focusing our vision on negative images we have grown to accept. They can save additional trips to the site to refresh our memory of forgotten details. Maps, pictures and notes provide a valuable resource in times of community crisis and a foundation for the work to follow. They also become a base against which to measure progress.
It is unlikely that the community image would decline through time without the images of the homes and home-sites declining. Therefore, it is helpful to consider the need for community renewal on two levels:
Items of owner/management responsibility
Items of resident responsibility
With this in mind, create an upgrade plan with an emphasis on short-term goals to produce immediate visual results, and long-term goals to achieve the desired end result. In this way, management’s example of immediate visual improvement can be justification for required resident home and site improvements.
You must lead by example if you are to be successful in this effort.
Level II Renewals
Now that we’ve discussed Level I renewals, let’s move into something a little more involved: Level II renewals.
Level II candidates are older communities than most Level I renewals, and, as a result, have a higher percentage of older homes. Many have serious age-related difficulties with the homes and homesite improvements. Some of the older homes may be owned by the community and rented. In addition, many Level II communities have vacant sites to lease.
As a result, a Level I renewal is a required first step in the upgrade process. Upgrades to the housing stock and homesites are so important to the process. And resident cooperation and acceptance of the program are essential. Just as research was important to the upgrade process for the community-owned items, it also is important to do proper research to upgrade the home stock and homesites.
The first step in the process is to inventory the homesites and determine, in accordance with local and state regulations, the maximum-size homes that can be accommodated on the existing home sites. In making that determination, information regarding regulations for separation and lot coverage is important. Many states allow older communities to apply the requirements in force when the community was new. This can make a big difference in the size of home that can be placed on a given lot, as well the amount of change that might be necessitated.
The next step in the research process is to inventory the age, size, and condition of each home in the community; which homes are renter-occupied, if any, and which homesites are vacant. This information can be placed on a spreadsheet and color-coded on a plan.
Level II Upgrades Require a Longer Schedule
Unlike the Level I upgrade, which can take place in a relatively short time, upgrading the home stock most often takes longer. Planning for the home stock upgrade takes considerable effort and creativity. One method of accomplishing this task is to review the research information in order to determine which homes can remain in the community in their present location, which homes might be acceptable if moved to a new location, which homes should be removed from the community, and which homesites are vacant.
The goal of this process is to begin, one section of the community at a time, to improve the home stock. The most visible location should be the first upgrade. This is a way to produce an early improvement and stimulate interest in the process. It might be determined that the priority is an area near the entrance that has several vacant sites. Some newer homes might remain, and two or three homes could be moved or relocated.
First, arrangements to relocate homes would be made to assist residents in the least desirable homes. Or they could move up to a newer home. At the same time, new or acceptable replacement homes would be placed on vacant sites in the area near the front. Those homes are made for sale.
Special incentives are provided to encourage existing residents to “move up”, and to entice new residents to move into the community. A marketing effort keying in on the Level I portion of the community renewal program and the home sale incentives could be initiated. This process, over time, would result in the phased upgrade of the whole community home stock. Such efforts could be part of a much-publicized, total-community “Grand Reopening”; or part of a quiet, metered effort over time.
Vacated City Parcels Get New Life, Potential Homebuyers Get Affordable Options
A Michigan company that began as a pilot project with modular housing under the auspices of a county land bank contract is shaping up to be a national model for city infill and affordable housing for some of the country’s most difficult and expensive places to buy a home.
“One of the largest housing challenges facing the United States is the lack of inventory,” said Todd Van Eck, a partner with David Allen in the newly incorporated business, called InnovaLab. “The lack of inventory in the urban setting has caused pricing to inflate at a rate that makes owning a home a real problem.”
The lack of inventory in urban communities and service-based communities is a crisis, Van Eck said. Families, in particular, cannot find affordable housing in the areas where jobs are most available.
“While the term ‘crisis’ is used to describe the housing inventory, the reality is that it negatively affects the very fiber of a community and the economy,” Van Eck said. “Quality housing, at an affordable price, is a must for every community.”
From County Pilot to Broad Incorporated Effort
MHInsider has followed the efforts of Kent County Land Bank — located in Grand Rapids, Mich., the county seat — and the rebranded InnovaLab entity in its efforts to provide a potential pilot program for an in-fill housing solution.
Since that time, Allen and his team have begun to phase out county contract work. It has set about the evolution of InnovaLab as a company to change the way housing is provided. And it uses off-site modular construction as one of its tools.
True to the root of its name — innovation — InnovaLab uses tools available to federal, state and local governments to generate affordable housing. It joins alternative methods of construction and efficient methods of operation to facilitate affordable housing at all income levels.
‘Breaking through traditional methods’
“InnovaLab is breaking through traditional methods of development to provide high-quality housing at an affordable price in communities throughout the country,” Allen said.
One of InnovaLab’s most important traits, as a company, is its ability to bring innovation to the development process. It does this with the use of tools available through various participants in order to get housing built.
Thinking beyond traditional residential development methods to work with the government, the nonprofit sector and private organizations has resulted in viable housing for in-fill. Among its most important partnerships in the new development process is InnovaLab’s relationship with Champion Home Builders. Champion makes a variety of factory-built housing, including modular.
InnovaLab cites numerous reasons why Champion Homes has been such a great partner. But, the predominant characteristic of Champion Homes is its team of people and processes, Van Eck said.
“Champion Homes has been outstanding in facilitating the design work of InnovaLab, providing its design expertise, putting those designs into modularized engineering,” he said. “Champion has been providing consistent high quality, and its ability to maintain a process that is simple and effective. Working with Champion Homes has allowed InnovaLab to provide an innovative cost-efficient mechanism that gets quality housing on in-fill properties.”
A crane drops one module of a home at a time on the southeast side of Grand Rapids, Mich.
What Can Be Done with Off-Site Built Homes?
The reality of off-site construction is that most housing can be built using off-site methods. Off-site methods are used to construct single-family homes, multi-unit housing, apartment housing, and hotels. For InnovaLab, off-site modular construction is a key component of housing inventory, currently and in the future.
Steve Payne is the director of business development for U.S. operations with Champion Home Builders.
“There are some limitations with modular construction, but in many cases modular systems can work. We use the same materials, meet the same building codes, look the same and have many of the same amenities of traditional site-built construction,” Payne said. “Also, we are capable of meeting the neighborhood architectural characteristics in most infill settings.”
For InnovaLab, Champion Homes was selected as its provider of housing because of the ability to consistently maintain InnovaLab’s core requirements.
Those InnovaLab core requirements include:
A defined process in design and construction
Consistent quality
Promotion of efficiencies
Clear communication
Maintenance of budgets and schedules
“The experience of actually going through the Champion Homes processes has exceeded expectations,” Allen said.
Why does InnovaLab see Off-Site Modular Homes as a key?
There are a number of reasons why InnovaLab uses off-site modular. The off-site modular construction process provides efficiency, consistent quality, defined timelines, and defined budgets. The Champion Homes process has permitted InnovaLab to generate designs that can be used on in-fill properties with great quality, desired layouts, and beautiful, modern interior design. The process also has provided InnovaLab with a clear pricing structure to permit an increase in amenities or a decrease in amenities with secure delivered pricing. It permits planning, budgeting, and execution of housing construction at a level unmatched by InnovaLab when using on-site methods.
In July 2018, InnovaLab had an entry-level modular home and a more high-end modular put on the city’s southeast side, as well as a mid-priced home on the northeast side of Grand Rapids.
All three homes came from Champion’s plant in Strattanville, Pa., and all arrived ready to set on their foundations within four weeks.
Each home came in at about 70 percent the cost of what its site-built counterpart would be, at about $105 per square foot. The median price per square foot in the U.S. is $148. In Grand Rapids, it’s about $129 — $142 per square foot in the metro area.
Eric DeLong, Grand Rapids’ interim city manager at the time, said he had some understanding of modular housing through his brother’s professional experience. It is impressive with how the product had taken great strides in quality, design, and aesthetics, he said.
“I felt that modular was a viable solution to the affordable housing problem here, and I’m pleased to see this pilot program going so well,” DeLong said. “InnovaLaB has launched a pilot with a lot of promise.”
More Modular Homes to Follow
The program continues its trajectory since the time those original three homes were installed last summer.
Another 10 modular residences have been installed, including a set of modular condos. And more orders are being taken.
Photos courtesy of Champion Homes.
Impressions of Modular Homes for City Infill
During a recent installation on the southeast side of the city, an agent for the home listings as well as nearby residents and business employees watched a crane lower pieces of two modular homes as work crews fixed them into place.
Tanya Powell-May is CEO of Legacy Homes GR, a Keller Williams agency.
“My team and I will list these three properties in a couple of months,” Powell-May said. “These are our first modular homes. We sold over 77 homes last year, but none were modular.
“I look at how quickly that home went up… that’s amazing,” she said. “We have a crisis here in terms of affordable housing. If we can get quality housing for people who need homes at this price point, that’s great. All over the nation, there’s a shortage in inventory, especially at this price point.”
Bobbie Locke, who works at a consulting agency across the street from the new homes, said it was “incredibly exciting” to see the new homes installed so efficiently.
“What a beautiful thing for the neighborhood,” she said. “The architecture is a perfect fit. Though the neighborhood is mature and established, they’ll fit right in. It’s a wonderful opportunity.
“It doesn’t just mean good housing, it means fast housing,” Locke said. “The fact they can do it so quickly means people who are waiting are going to get into homes faster.”
How Modular Homes Are Sold
Potential buyers can also treat these new modular homes as they would any other home for sale. When completed and priced, the homes are listed on the metro multiple listing service and will be open for offers. Allen said developers can make the math work for the land. So, the only obstacle is people’s general perception of off-site built homes.
Typically, that perception is changed with a walk-through of a modular home.
“The stigma associated with off-site modular homes is not well placed,” Van Eck said, noting how auto manufacturing has thrived with continued improved processes. “Like automobiles, it is time for housing to modernize its processes to focus on efficiency as well as quality.”
MHInsider Managing Editor Matt Milkovich contributed to this article.
MHVillage teamed with IMHA to present the 2019 MH FacTOURy Summit in Elkhart, Ind. The June 17-18 event helps community owners and operators, as well as other manufactured housing professionals, better understand the business and best practices for customer service, management, marketing, sales and more.
What follows is a series of quick soundbites from the education series provided by MH FacTOURy Summit presenters.
MH FacTOURy Summit Presenter on “Social Media Mastery”:
Social media has a higher close rate and is less expensive than Google AdWords PPC
More than 80% of U.S. consumers have social media
Facebook and Instagram are the most popular platform, with 88 and 60% saturation respectively
75% of consumers base purchases on reviews
More than half of social media users would rather message/text than call for customer service
When shunned on social media, 30% of those polled will go to your competitor
90 percent of Instagram users are 35 years old or younger
What to do on social? Educate about the buying process, post engaging content, share news, talk about local events, share listings, take a poll, or share testimonials/reviews, video/virtual tour, publicize charitable giving
No more free reach — organic reach on Facebook is dipping as low as 2%
Facebook pixel = use a code on your site that tracks visitors and shows them your ads
Be prepared to respond now — this generation wants things instantly
The chance of closing an online lead diminishes by 65% within the first 15 minutes of receiving the lead
You need to respond the way buyers want to reach you — don’t push toward other means of communication
Dee Pizer, Board Trustee for Zeman Homes
MH FacTOURy Summit Presenter “How to Buy the Right Manufactured Homes”:
Start with the site, measure the lot
Make sure the aesthetic of the home fits with the community
Upgrade siding to a darker color for corner lots
Create a color package — if someone wants to factory order, you have color packages that are sure to color coordinate
John Ace Underwood, of NRI Inc.
MH FacTOURy Summit Presenter on “Lead Management: Marketing Might Be Your Goldmine”
Marketing is all about finding people who are interested in your products or services
If you aren’t getting more leads than you can handle, you have a problem
There are no good or bad leads, only leads
We absolutely, unequivocally own the word ‘affordable’
Do not qualify people over the phone. Get them in front of you and then qualify them.
Never, ever end a conversation without having discussed and scheduled the next logical step in the sales process.
Everything is about how your prospect feels after having spoken to you
The Blevins team talks with customers at a recent trade show.
Manufactured Housing Suppliers Combine Forces
Blevins Inc., a Nashville-based supplier of housing products, has acquired Tri-State Distributors and its nine branch locations.
Tri-State will continue to operate its corporate office in Royston, Ga., and all of its nine locations across Georgia, Florida, South Carolina, Alabama and Mississippi. Tri-State will be a division of Blevins Inc. and will continue operating as Tri-State Distributors.
Founded in 1983, Tri-State serves the hearth, heating and gas products industries, as well as the manufactured housing and residential HVAC industries, in the southeast United States. Its product lines include gas grills, fireplace logs and heating products, along with HVAC equipment and manufactured housing accessories.
Merging Companies, Merging Ideas
“When Brad Blevins and I began talking about merging our two companies, I came to realize that his ideas about what success means in business are the same as mine,” said Tri-State CEO Steve Williams. “We both believe in taking good care of customers and employees. The transition has been very smooth, and I have agreed to stay on for a while to help ensure that operations continue to run as they should. Overall, I believe this merger will be a win-win for everyone.”
Brad Blevins, president of Blevins Inc., said his company and Tri-State have been competitors for more than 20 years, and the organizations have become well acquainted with each other during that time.
“By partnering with Tri-State, we look forward to helping continue the great momentum that the company has and are very excited about the benefits that both companies can get by being a part of the same organization,” Blevins said.
Founded in 1971 and family owned, Blevins supplies the manufactured housing industry with 13 distribution locations. The Blevins service area stretches from New Mexico to Maine to Florida, making deliveries to 35 states. With the acquisition of Tri-State Distributors, Blevins Inc. will have over 500 associates.
President Trump readies himself to sign an executive order on affordable housing. Image and video courtesy of C-Span.
Move Toward Regulatory Reform Bodes Well for Manufactured Housing Industry
President Trump signed an executive order that directs federal agencies to collaborate on ways to reduce government barriers to affordable housing.
“We’re going to take a major step in our historic regulatory reduction campaign today,” the president said during a live broadcast from the Oval Office. “We begin a bold new initiative to bring down the cost of housing for American families… launching the White House Council on Eliminating Regulatory Barriers to Affordable Housing.”
The new federal council will be led by Department of Housing and Urban Development Secretary Ben Carson.
“Over-regulation of housing in the housing market is a primary cause of the rising housing costs across our country. Nationwide it’s estimated that the regulations account for more than 25 percent of the cost of a new home,” the president said. “As a result, the supply of affordable housing cannot keep up with demand today. Over 37 million American households have to spend more than 30 percent of their annual income on housing.”
Manufactured Housing Institute on Council for Affordable Housing
In a “Housing Alert” to MHI members, the national association indicated the council would work on how to:
Quantify the impact of the lack of affordable housing on individuals and the economy and the impact of regulatory barriers on the production of affordable housing
Review rules and regulations for impact on impeding affordable housing development. And to make changes at the federal level to support the production of affordable housing
Adjust federal programs to incentivize localities to reduce regulatory barriers or condition federal funding on such reductions of local impediments, such as zoning and land-use restrictions
“MHI has always advocated for policy solutions that target the underlying problem—a limited supply of affordable housing,” MHI stated in its alert. “Today’s executive order makes clear that the only appropriate solution is to focus on reducing the cost of supply and emphasize innovative housing solutions, which includes manufactured housing and a right-sized regulatory focus.”
HUD Secretary Ben Carson to Lead New Council on Affordable Housing
Secretary Ben Carson said the council consists of members from eight federal agencies. Council members will lead federal efforts to engage with the state, local and tribal leaders across the country. The goal is to remove obstacles that impede the production of affordable homes.
“The president has given us a mission to break down barriers and to clear the path for the millions of Americans to pursue their American dream,” Carson said. “It’s a mission we proudly and enthusiastically accept.
“The forgotten men and women of America will be forgotten no longer”, Carson added, thanking the president and administration.
“The home is the foundation of the community, which is the foundation of the nation. We can all do this if we work together,” Carson said.
Structure of the New Council on Affordable Housing
A White House-issued release on the executive order states the assistants to the president for domestic policy and for economic policy, or their designees, will serve as vice chairpersons for the council.
In addition, the council on affordable housing will consist of the following officials or their designees:
Secretary of the Treasury
The Administrator of the Environmental Protection Agency
Secretary of the Interior
Secretary of Agriculture
Director of the Office of Management and Budget
Secretary of Labor
Chairman of the Council of Economic Advisers
Secretary of Transportation
Deputy Assistant to the President and Director of Intergovernmental Affairs
Secretary of Energy
Heads of executive departments, agencies and offices may, from time to time, designate or invite attendees, as appropriate. The vice chairs shall convene regular meetings of the council, determine its agenda, and direct its work with the oversight of and in consultation with the chairman. The Department of Housing and Urban Development will provide funding and administrative support for the council.
Senators Join Administration for Signing of Executive Order on Regulatory Reform
Sen. Martha McSally, R-Ariz., said she visited all 15 Arizona counties within the first 90 days of her Senate term. She said there was a theme among her constituents throughout.
“We’re a very diverse state, and the economy is growing. But a top theme is affordable housing, and there are many barriers to that, and so this group coming together … to provide more opportunities at lower cost, so everybody can meet their full potential, is really important for my constituents. So I am grateful for this initiative.”
Sen. Tim Scott, R-S.C., said the new council is certain to help more Americans who are credit-worthy to achieve homeownership.
“The American Dream so often is seen through the prism of homeownership,” Scott said. “This executive order will accelerate the path of responsible home ownership.”
Affordable Housing Crisis Impact on the Housing Market
The demand for affordable living options is rapidly increasing, providing new opportunities to fill this gap in the market. Mobile or manufactured home communities are a solid affordable housing option for populations priced out of traditional affordable options.
At the same time, many mobile home communities have undergone a significant transformation over the past two decades. Communities still in need of improvements have new financing opportunities for owners trying to turn a profit.
Aesthetics, Affordability Can Co-exist
Mobile home community owners have made great strides toward shifting the perception and the reality of manufactured home living. Many new communities include amenities like clubhouses, swimming pools, and tennis and basketball courts. The majority of the homes are move-in-ready, three-bedroom houses with full kitchens, baths, and laundry. The subdivision setup of communities allows for private parking, individual gardens, lawns, and patios on small, easy-to-maintain lots.
Affordability comes into play here. Consider that the quality of manufactured homes is equal to site-built homes, but the cost comes in at a fraction. This allows residents to save hundreds of dollars per month. Savings come from not only monthly lot rent or mortgage payments, but utilities when compared with living in an apartment or site-built home.
A manufactured home community in Davie, Fla.
The New Normal of Mobile Home Mortgages
Just over a decade ago, residents would walk up to any mobile home dealer and purchase their own home to move into a park of choice. In that case, they could apply for a chattel mortgage. This allows the customer to pay off the home while not owning the land. These days, the path to manufactured homeownership looks a little different.
Most of these dealerships closed down in the wake of the Great Recession, especially in the Midwest. And in the mobile home parks themselves, vacancies increased — resulting in foreclosures on the homes owned by residents. In these vacant properties, mobile home community owners have found new opportunities.
One method to increase occupancy and profitability is for the community to own the new inventory of homes and finance them with chattel financing, or to rent to residents. By providing financing to residents, manufactured home community owners can increase the occupancies at the properties and for their entire portfolio. And, when refinancing, community owners can receive cash-out components to use toward property improvements.
By owning the homes and renting them out to residents, Mobile home community owners can increase cash flow and enhance the communal aspects of the parks, adding further value to the community and its homes.
A Pair of Examples
Here is an example: one manufactured home community management firm in 2006 needs funds to bring new and used mobile homes to some recently acquired properties in Missouri. They want to fund the acquisition of these homes and increase occupancy. The firm establishes a relationship with a bank to finance its chattel portfolio and uses other financing options for new home acquisitions.
The increase in occupancy and value creation allowed the property to be refinanced in 2018 with a substantial cash-out component. They were able to set aside funds for additional site work and down payments for more houses. And the loan has an earn-out component in addition to being non-recourse.
In 2019, 13 years after starting the chattel finance business, the firm refinanced 800 homes with a new chattel financing agreement for $11 million to fund the acquisition of new homes, as well as the consolidation and reduction of interest rates for the entire portfolio.
Theory in Action
In our experience, these loans have been funded by a range of lenders, including agencies, CMBS, banks, and debt funds. Many of them had earn-out provisions. So, as the property cash flow increased over the loan term, some lenders would fund out cash equity to borrowers. This allows for liquidity without going through the entire refinancing of the property.
The dynamics of manufactured home community ownership are changing. This means great potential exists for savvy owners who are ready to refresh tired, less desirable properties. At the same time, these owners can provide much-needed affordable options to a housing market that’s desperate for them.
A commercial mortgage banking firm can help prepare the park and owner who don’t have a financial officer who understands these more complex financing options. A commercial mortgage firm can visit the property to ensure that it is up to the expectations of the lender, appraiser, and engineers. With full cooperation and commitment, mortgage and chattel loans can close in 45 to 75 days.
Emphasis on Education, Expertise, Solutions for Aspiring Homebuyers
Freddie Mac has launched All For Home, a new approach to its single-family affordable home lending mission.
The All for Home initiative looks to drive industry change by providing:
Education
Mortgage offerings
Business solutions
Insights to lenders and the affordable housing ecosystem
“For nearly 50 years, Freddie Mac has been making homeownership possible for millions of people who wish to purchase a home,” said Danny Gardner, senior vice president of single-family affordable lending and access to credit at Freddie Mac. “Our All For Home effort spotlights Freddie Mac’s leadership in support of its affordable mission and looks beyond today to build the future of home by facilitating better lender and partner collaboration to reduce barriers for those seeking homeownership.”
With All For Home, Freddie Mac Single-Family is working for a change to the perception of affordable home lending by providing thought leadership, educational resources and innovative, collaborative solutions to enable lenders and partners to reach more people who want to own a home.
The goal is to re-shape affordable lending and broaden understanding of opportunities to better serve borrowers.
Partnership In Place with Manufactured Housing Institute
Freddie Mac has partnered with the Manufactured Housing Institute and is working with leading manufactured home builders to expand manufactured home buying and ownership to more borrowers. The requirements for manufactured homes are designed so the mortgages purchased are originated, underwritten and serviced to help a qualified borrower buy a manufactured home they can both afford and sustain.
Freddie Mac’s Home Possible® affordable mortgage origination program during 2015 – 2018 exceeded $50 billion in home mortgages to 262,328 U.S. families.
Across the country, Freddie Mac provided homeownership and financial literacy education to 518,168 aspiring homeowners through its CreditSmart® program in 2018. In addition, it provided affordable-lending training to 32,796 loan officers and real estate professionals through outreach events last year.
Freddie Mac Initiative focuses on four pillars
Insights
Provide best-in-class research and data on the affordable lending market and the Borrower of the Future customer base. The results will be used to advance thought leadership and industry perspectives on the future of homeownership.
Education
Host community-based homeownership education and outreach events
Provide lender and real estate professional training
Help housing counselors to reach and inform audiences such as millennials, women, veterans, people with disabilities, senior citizens and very low- to moderate-income borrowers
Mortgage Offerings
Develop additional lending and down-payment solutions for:
First-time homebuyers
Manufactured housing
Energy efficiency properties
For very low- to moderate-income borrowers
Business Solutions
Provide lenders with expanded opportunities to enable technology-driven lending processing services including:
Loan Product Advisor®
Automated Collateral Evaluation
Asset and Income Modeler including AIM for self-employed borrowers
Home Possible Sweat Equity offerings, rural offerings such as NextJob, Servicing-Released XChange℠, and Freddie Automated Servicing Transfer℠
“Through collaboration and partnership, we are working to develop and enhance solutions and technologies that allow our partners to confidently, swiftly and easily help more people achieve the dream of homeownership,” Gardner added. “There is power in anticipating future homeownership needs so that, together, our partners and lenders can make a positive impact.”
More Home Buying Initiatives On the Way
Freddie Mac will continue to launch new affordable education and lending initiatives in the coming months.
June is National Homeownership Month. Freddie Mac recognizes the critical need to address the changing dynamics in the housing market. The changing marketplace creates new challenges, which require new strategies for the realization of homeownership. Freddie Mac continues to launch new affordable education and home lending programs and is proud to prompt industry dialogue directed at solving affordability and accessibility barriers for borrowers.
In August, the RV/MH Hall of Fame will celebrate the 2025 class of inductees, five from each industry.
“Our selection committees held meetings to review...
A Michigan company that began as a pilot project with modular housing under the auspices of a county land bank contract is shaping up to be a national model for city infill and affordable housing for some of the country’s most difficult and expensive places to buy a home.
MH FacTOURy Summit Presenter “How to Buy the Right Manufactured Homes”:
