Passage of Senate Bill 2155 Eases Concerns of Retailers, Operators Who Want to Assist Customers in the Mortgage Loan Process
Yesterday, the U.S. House of Representatives passed Senate Bill 2155, which contains language clarifying the role of “loan originator”.
The new language states a manufactured housing retailer or seller is not a “loan originator” simply because they provide assistance in the mortgage loan process.
This provision was included in Senate Bill 2155 — the “Economic Growth, Regulatory Relief, and Consumer Protection Act”. The bill contains reforms intended to improve the national financial regulatory framework and promote economic growth.
White House Must Sign Senate Bill 2155 for Change to Take Place
House approval and passage of 2155 by the Senate in March means the legislation heads to the President’s desk for signature.
MHI contends a retailer or seller cannot fit the definition if there is no compensation or gain related to the loan.
The organization’s government affairs team works closely with both Congressional leadership on Capitol Hill and champions of manufactured housing to secure passage of this important provision. More than 15,000 calls and emails were made to Washington.
Grassroots outreach from MHI members and state executive directors were instrumental in helping Members of Congress understand the importance of this provision to their constituents.
Reaction to Passage of Senate Bill 2155
Upon passage of the bill, U.S. Representative Andy Barr (R-KY), long-time supporter of manufactured housing and author of the Preserving Access to Manufactured Housing Act (H.R. 1699), said, “Dodd-Frank’s one-size-fits-all ‘loan originator’ definition failed to account for the unique nature of the manufactured housing market. The result: hard-working, low and moderate income Americans have lost access to affordable manufactured housing.
The Preserving Access to Manufactured Housing Act, included in Senate Bill 2155, fixes this problem and enables more Americans to achieve the American Dream of homeownership.” View Representative Barr’s remarks here.
During House debate, Representative French Hill (R-AR) highlighted the manufactured housing provision contained in 2155, arguing that the provision, “will help hundreds of Arkansans – hardworking families who need access to credit for manufactured housing in rural parts of the state.”
This provision passed with strong bipartisan support in both the House and the Senate. On March 14th, the Senate passed Senate Bill 2155 by a vote of 67 to 31. Tuesday, the House passed this same bill today by a vote of 258 to 159.
Language in the larger regulatory reform bill was made possible by MHI’s extensive and successful efforts over the last few years in getting a similar provision included in three previous House-passed bills (H.R. 1699, H.R. 10, and an FY 2018 appropriations bill), as well as a freestanding Senate manufactured housing bill (S. 1751).
Please contact MHI’s Government Affairs Department with any questions at (703) 229-6208 or MHIgov@mfghome.org.
From left, Rich Rice, Keith Carnahan, Wally Comer, Jerry Winter and Susan Kasinger
Wally Comer’s Adventure Homes Aims to Close Its First Decade on a Strong Note
Adventure Homes is only nine years old, but you’d be forgiven if you felt the award-winning manufacturer has beenbuilding homes for as long as you can recall.
The industry’s national trade organization, Manufactured Housing Institute, in each of the last two years has pointed to Adventure Homes as manufacturer of the year for those with two plants or fewer.
And though the single-plant builder based in little Garrett, Ind. had a rather unconventional start, Adventure Homes President Wally Comer and his team have managed to quadruple revenues since the company’s first year.
Adventure Homes has added a 20,000 square-foot finishing plant, the team has grown to more than 200 employees on the production line, and the company has built a steady stream of high-quality, hand-crafted and well-priced homes – to the tune of 1,520 homes in 2017.
“The first 20 years of ups and downs has prepared me for the ride I am on now and it is a great ride,” Comer said.
The First 20 Years
“I came out of college in 1971 and ran into a young guy who was driving a brand-new Corvette. He was my age and had a Corvette not a Volkswagen.
“I said what in the world do you do? And he said he was a controller for a recreational vehicle plant in Riverside,” Comer recalls. “I told him that I couldn’t find anything that I wanted to do, but I was interested in what he was doing. I was working for a pharmaceutical company and hated it. He came to my apartment later and said he got me an interview. The HR guy told me to talk to one more person before he hired me, and that was Jess Maxcy. Jess hired me and has been a mentor for me my entire career.”
Jess is the current state association director in California, but at the time of Comer’s hire was the youngest VP in the Industry.
“He ran the entire recreational vehicle operation at Redman. And, he was arrogant,” Comer said. “He came into my office on the first day and introduced me to the sales manager, and the general manager, and left no doubt who was in charge. Jess has a strong, forceful personality, but Comer was not put off by Maxcy’s demeanor. He embraced it.
Wally Comer called on him for answers to the many questions someone new to the industry might ask.
“Every time I needed advice, I would call him. He is a very knowledgeable guy. I still call him,” Comer said.
Some of those calls, as it turns out, would be long-distance. The kid who grew up in Glendale, Calif., was shipped off to work in Silverton, Ore.
“It was a little bus stop town,” Comer said. “At the Silverton Hotel, you had to go down to the lobby and get the phone to bring it back to your room.”
Adventure Homes First Home
‘It was just nuts’
In the 1970s the manufactured housing industry was a wild ride always perhaps about to leave the tracks. The industry was rolling out about 550,000 homes each year.
“Fleetwood, Skyline and Redman were the big three,” Comer said. “And there were a whole lot of guys gaining ground on those three including Clayton and Champion.
“If you were talented at all, they were promoting you up because manufacturers had so many plants and were continuing to open more, he said.
Comer was in Oregon about a year when Bob Steins, the sales manager at Redman, mentioned a new sales manager opening to consider.
Turning heads, climbing the ranks
“I said ‘What? I have been a been a salesman here’ and for only a year,” Comer said. “But I got the job and was the sales manager.” It took no time at all for Comer to realize why he got the sales manager’s job.
His first step was to attend a sales training in Texas, where he encountered a couple of trainees from Georgia.
“Some of the salesman and trainees I encountered were not very good,They couldn’t sell anything,” Comer said. “When I asked about it they said they didn’t ever call anyone. They didn’t have to call anyone. Everyone just called them and they signed orders. My income tripled in 1972 as I started influencing other people to attain their goals.
“The industry you see today is nothing like it was. It was ‘Wild Wild West’. People were making so much money they didn’t even know how much they were making,” he said. But Comer was building the foundation of solid sales procedures and discipline that would prepare him and the people around him for what was looming.
Comer went to North Carolina for a job with Coburn Homes. He was there roughly two years when Bob Steins called again. This time he was in Florida and wanted to see if Comer was interested in a general managers’ training program. He saw this as another opportunity to gain experience, so at the age of 27 started to prepare himself for general management.
The work was for Zimmer Homes, out of Cordeal, Ga.
“Georgia was big mobile home country,” Wally Comer said. “It was a trip.”
It was a trip that lasted only four months. Comer said he had begun to doubt the industry, and had ideals about doing something in the world of finance. He left Zimmer and he left manufactured housing for 10 years.
The Hiatus
Comer left the industry but did not very far. He joined AMP, Inc. in Harrisburg, Pa. They were the largest manufacturer of electrical and electronic connectors in the world.
Comer said he spent those years messing around a lot, spending money, and eventually came to terms with the fact he had taken a misstep. He was thinking about his career, about manufactured housing again, and called Jess Maxcy to talk about it.
“I asked him what he thought about me coming back in the manufactured housing industry again? He said ‘Have you learned your lesson? Will you listen to me this time?’” Comer said.
A Return to Manufactured Housing
Lee Posey was president of Redman when Comer started in 1971, but went on his own to start Palm Harbor Homes in Dallas. Maxcy told him Palm Harbor had recently opened a plant in Ohio, and maybe Comer could be in sales.
Comer again kick-started his career in the manufactured housing industry, putting it on himself to develop the people who would help grow the business.
“I was there for a year and did extremely well, had a great year, but it was like the old cowboy industry again, and I questioned myself again,” he said. “It seemed I couldn’t find a lot of good, professional people to rely on.”
It was the mid-1990s. He was on the phone with a friend, a dealer in the industry who urged him to make a change.
Comer went on to talk with Terry Desio at the Skyline drywall plant in Sturgis, Mich., and met a general manager with Skyline named Gary Lambert.
“He was a great GM, and we took off,” Comer said.
A fresh start with some of the same old challenges
But as his roller coast career would have it, Lambert soon exited for Palm Harbor.
Regardless, it was at Skyline where Comer really got started.
The industry was noticing the success that Comer was bringing to Skyline, and Tom Lizzy with Holly Park wanted Comer to move over to run the Ohio territory.
“I loved Lizzy,” Comer said. “He said the territory was doing 500,000 per year, and when I was there our homes weren’t even listed in the top ten in the state.”
This was the first time that Comer could show what he could do on his own. It was a meteoric rise in that market. By building relationships with two of the largest dealers, Ace Elsea and Steve Schwartz, in Ohio he took the territory from 500,000 annually to more than 12 million in only six years. He learned the value of relationships both with customers and co-workers in building business.
He was pondering where the next step would be, with his new-found philosophy on people management versus money management, he decided he was ready to go on his own.
Lifetime Homes
“My partner was Paul Lytle. He had been a controller, and we got a bunch of investors. We ran Lifetime Homes for about three years,” Comer said. “We were experiencing a steady increase in production, but as the turn of the century was upon us so was a downturn in the industry.
“Our investors were not in the industry themselves and were not comfortable with their investment,” he said. “We were forced to sell off assets. This was not an indictment of our business plan as much as the ‘lack of fortitude’ of our investors.”
However, the situation couldn’t break Comer’s confidence in himself as an owner of a manufactured home company.
Fleetwood in Garrett, Ind.
It was 2003, and Comer said he felt as though he was starting again. He worked for a bit as general manager for Ritz-Craft Homes in Jonesville, Mich. Then he went to work with Chuck Wilkinson, someone he had worked with at Palm Harbor who had landed at Fleetwood.
Wally Comer was asked to run the infamous Fleetwood Garrett Indiana plant with the promise that he could move out to take over the Arizona territory after two years. Everyone warned him away from it, but Comer went anyhow. The Garrett facility had seen a half dozen GMs in just as many years. However, Wally Comer felt his presence was needed.
“I got there and we turned it around. We were surrounded with really great people, wonderful staff. I had friends in Ohio, called all the dealers I know and told them to come down, we were going to have a show,” he said. “We got some homes out there in the lot and had people through them.
“Dealers walked into a house and said ‘Wally, can we do white trim?’ I said yes, and they hugged me. They were so glad to have a salesman back in the plant, someone who understood service,” he said.
The attitude of the employees changed.
The attitude of the customers changed. And Comer was seen as the right guy at the right time. However, more dark clouds were on the horizon. In 2009, Fleetwood Enterprises closed doors and left the Garret facility with a great product, a great workforce and a great customer base without ownership.
“It’s the best thing that ever happened to me,” Comer said. “Liberated is a good word for it.”
That Same Little Plant in Garrett
Comer went home, talked with his wife. Many of the workers from the plant showed up and bluntly suggested he buy the place, run the plant himself.
Comer, of course, worried about financing and the level of energy it would require.
But all of those people? Their jobs. Their families?
“My wife Joanna, she is really the one who pushed me to have the courage to do it. She was willing to risk it all. She told me she was certain I could do this,” Comer said.
He sat with a banker and said he wanted to buy the plant. The banker said “I want to be taller.” The pair agreed that resources were less than sufficient for that kind of purchase. But the banker said a pair of investors he knows might have some interest.
“That was nine years ago, Aug. 5, 2009,” Comer said.
Walt Fuller and Jerry Henry put up the money, and Wally Comer showed up on the last Friday of operation for what was Fleetwood Homes Garrett Plant 55. On Monday it would be Adventure Homes Plant 1.
The New Headquarters
Adventure Homes couldn’t even hang a sign out front. There were no formal agreements for pay, or insurance or other benefits. But more than 100 people showed up to build homes. In no time, all of the details would work out. The first year, Adventure Homes sold $12 million in homes.
Last year, the company topped $50 million.
Because Fuller and Henry had confidence in Comer, they gave their full support. And the Adventure plan was simple; keep expenses low, and put all the resources they are able into the homes they build. Today, signs hang in the factory that say “Would You Buy the Home You Built Today?” and “Remember, The Next Inspector is The Customer” as well as “If We Don’t Do It Better – Our Competition Will”.
Comer reminds people that the homes Adventure builds cost a substantial amount of money, but the quality and care that goes into them is free.
They don’t really care about the numbers, not as much as about the house. They build what people want. The company is built on providing a home to be proud of at an affordable price. It’s “Luxury and Comfort for Less”.
“I’m not a mass producer,” Wally Comer said. “I’m sort of a quasi-custom builder, and we’ve been very successful.”
A Tough Time for a New Venture
Adventure’s General Manager Rich Rice said, in a strictly business sense, 2009 was not the best time in the industry to start a manufacturing facility. But the decision to launch Adventure Homes had little to do with strictly business logic, and more to do with the passion of the people here to succeed.
“We knew our people could do it better and continue to create a demand for our homes even up against larger, more financially stable competitors,” Rice said. “We could do it better and for less money.
“This was as pure as it could be in terms of one individual trying to save some jobs,” Rice said. “It was about Wally and his partners, and this town, and their intentions for it. We spent those first three years using what we had learned at Fleetwood, but it really was only an experimental start for us along the way to finding our niche.”
He said the leadership began to learn just how deeply talented the workforce is, and understood Adventure really could offer a custom home in a way no one else has, from the manufacturing line.
It was a brave assertion that Adventure Homes has made good on. It is an adventure that professionals industry wide, as well as homeowners in the Midwest, very much appreciate.
“We go to a show with a home that has all that ‘bling’ in it for a low price, and we started turning the conversation around so that it’s no longer a wonder that we are able to do this type of customization, but why others don’t,” Rice said. “That’s taken us a long way.”
And, Wally Comer’s roller coaster career has reached a height he aims to hold for a while.
“Joanna is the love of my life, and I’m incredibly happy. Both of my business partners are super good guys. They put the funds behind me and it’s just been, it’s been what I’ve always wanted,” Comer said.
“If I had to do it, I would not have changed much as everything that has happened in my career has led right here. Manufactured housing has been good to me and I’ve really love the friendships,” he said. “Only in this industry can you get by this way. You do not need fancy degrees or a boatload of talent, you just have to be willing to do the work. The industry is filled with opportunity.”
“Wally is one of those individuals who absolutely gives back to the people who got him here, and it’s really easy to work for someone like that.” – General Manager Rich Rice
Michigan Home to Nine of the Largest Manufactured Home Community Owners and Operators in the Nation
The manufactured housing industry is poised to have one of its best years in recent history and Michigan is responsible for a large percentage of the success, according to the Michigan Manufactured Housing Association, (MMHA).
“Michigan has always been a big proponent of manufactured homes, the communities and the people who reside in them, so it really isn’t unexpected that Michigan is home to many of the largest manufactured home community owners and operators,” said Bill Sheffer, executive director of MMHA.
According to the Manufactured Housing Institute (MHI) National Communities Council, nine of the country’s top 50 manufactured home community owners and operators are based in Michigan. Michigan-based community operators are responsible for 213,244 of the 693,000 national manufactured home sites; nearly 31 percent of all manufactured home sites in the county.
“It is an honor to be in the top 50 largest manufactured home community owners and operators in the country,” said Jeff Davidson, president of Meritus. Meritus Communities was 12th on the list. “This ranking is a reflection of the hard work and dedication the entire Meritus team has to the industry and the people who live in manufactured home communities.”
“The MMHA community as a whole should be extremely proud of this,” said Kim Scott, Director – Operations (Manufactured Housing Division), M. Shapiro Real Estate Group. “Everyone on that list, as well as everyone involved in MMHA, worked together through the leaner years to do what was best for the communities, their owner/operators, and their residents. Being recognized for our successes is a testimony to all those efforts over the years.”
MMHA is dedicated to educating the public about the benefits of manufactured and modular home living and connecting people interested in finding a community or home with its members. The Michigan Manufactured Housing Association (MMHA) is one of Michigan’s oldest trade associations, founded in 1941. MMHA is a nonprofit association representing the manufactured and modular home industry in Michigan. MMHA works to improve the image of manufactured and modular housing by educating consumers, media and government about the quality, affordability, design, and beauty of the homes.
For more information, visit the Michigan Manufactured Housing Association at www.michhome.org or contact MMHA, 2222 Association Drive, Okemos, MI 48864-5978; 517.349.3300.
Are you looking for targeted web traffic? Use MHVillage Pay-Per-Click ads!
Did you know that MHVillage not only offers home listings, but you can also run Pay-Per-Click ads. In fact, many MH professionals use these ads to catch the eye of homebuyers and homeowners. These ads are simple text ads that appear on MHVillage. In particular, they are great for getting out a particular sales message.
Let’s take a look as to how these Pay-Per-Click ads work:
Where do Pay-Per-Click ads appear?
MHVillage.com visitors come to the site to search for homes in specific cities, counties, and zip codes. Then, they are presented with a list of all the homes available in their targeted search area. If their target area is in a county you have chosen, your ad appears. Your ad never appears on search pages for counties in which you are not interested.
Who will see my ad?
When MHVillage.com visitors search for homes in a county where you have chosen to advertise, they will see your ad. For example, if someone searches for homes in zip code 49525 and you have chosen Kent County, MI as a county where you would like your ad to appear, they will see your ad because 49525 is in Kent County.
How effective are Pay-Per-Click ads?
Pay-per-Click ads are very effective because you only pay for results. You are charged only if someone clicks on your ad and goes to your website. Because you can precisely target your market area, MHVillage.com ads will be extremely effective for products or services that buyers or sellers of manufactured homes want or need.
Many professionals use Pay-Per-Click ads to send traffic to their company websites or their Sales Center pages on MHVillage.
But how do I know if Pay-Per-Click ads are effective for my business?
That’s easy! You simply track how many clicks it takes to make one sale. For example, you know that you will close 1 out of every 15 prospects that fills out an information form on your website. You also track the number of people who come to your site from your ad on MHVillage.com, and know that 1 out of 20 of those prospects actually fills out your form. That means it takes 300 clicks (15 X 20) to close one sale. If you pay 45¢ per click, you have spent $135 (.45 X 300) to close that sale. That could be good or bad depending on the product’s profit margin, but the point is that you will quickly know if your ad is effective and can adjust your advertising budget appropriately.
How much is a Pay-Per-Click ad?
The cost is completely up to you! First, you decide how much you will pay per click (minimum 45¢). Then you decide the maximum amount of money you will pay per day. When your daily maximum is reached, your ad is no longer displayed that day.
What kinds of products or services can I advertise?
You can advertise just about anything that you believe would be appropriate for our target audience. Of course, it has to be legal and not competitive to our site, nor can it be something with which we do not wish to be associated. See our terms of service for all the details.
Can I run more than one ad?
Yes! You may run a different ad in every county in the country if you want to. There is no limit.
How do I pay for my ad?
When you are finished placing your ad, we will ask you for your credit card. At the end of the month we will multiply your clicks by your bid and charge your card automatically.
What if I want to change my ad?
Yes! You can edit your ad anytime you like, 24 hours a day, 7 days a week. Many of our advertisers change their ads weekly to fine tune and attract exactly the customers they want.
Is there a minimum time this has to run?
No. You may turn your ad on or off as much and as often as you want. You are only billed for actual clicks to your website at the end of each month.
Four Leaf Companies’ ‘Tech Guys’ Turn to MH Community Ownership
The former owners of The Opus Group are bringing their analytics and tech know-how to the MH industry. Mike Callaghan and Kevin Shaughnessy’s business, Four Leaf Companies in Oak Brook, is offering its two patented tech plugins to MH community owners nationwide.
Yes. They are sharing their secret sauce.
Why? Callaghan and Shaughnessy don’t want to be the only modern tech players in the industry. And they know how data and data analytics can make the entire MH industry more sophisticated.
“Manufactured housing construction is top notch now,” says Callaghan. “Buying and selling these homes needs to be, too.”
The Third Party and New Home platforms are the first digital platforms of their kind in the MH community industry. Each is scalable for either property owners or bankers/brokers/investors and focused on growth and success. These tech services bring about more sales, fill empty lots, and increase property values for both owners and investors.
Let’s take a look at each platform in detail.
Third Party Property Management
The Third Party Property Management platform is designed to help MH communities grow the property value creatively, efficiently and quickly. Some property management services do just enough to keep the lights on. They may focus solely on core services, such as rent collection and basic reporting. Four Leaf Companies’ Third Party Management provides growth strategies for the changing, post-crash market.
Four Leaf’s “secret sauce” is the Four Levers of Growth, which drive success for new ventures and declining assets alike:
Grow Asset Value – Expert ways to grow future selling prices
Reduce Expenses – No-pain ways to grow income by reducing expenses
Generate Revenue – Creative ways to generate revenue
Bring in New Homes – Profitable ways to finance and bring in a New Homes program
Community owners and managers who work with the Third Party program have access to an array of Four Leaf management services, including:
Funding Sources and Financing
Enjoy financing solution expertise on cash outlay, rates, fees, sales vs. rental and more, all in the name of bringing in new spec homes and extending loans to future buyers. Four Leaf also has an online platform where residents can take care of certain aspects of applying, processing and closing.
Digital and Traditional Marketing Plans
Get a customized marketing plan that uses online advertising, local outreach, social media, email, referral programs and virtual tours to reach the target audience.
Ongoing Staff Training and IT Support
From applied training modules to critical digital support, Four Leaf provides teams with the information and assistance they need along the way.
New Home Maintenance and Home Rehab
New homes are subject to a 28-point checklist that gets them market ready, while rehab projects are professionally managed with a focus on profitability.
Management and Daily Task Guidance
Four Leaf managers care about communities and their operators and strive to facilitate a deeper understanding of how to connect the right customers, homes and prices. Four Leaf also guides and measures daily tasks such as marketing, sales, operations and financing.
Resident Relations and Regulatory Compliance
To keep communities happy and healthy, Four Leaf promotes a customer-centered culture focused on safety, security, town hall meetings, communication tools and event planning. Further, managers ensure that all regulations are followed.
The Third Party Property Management program also encompasses the second platform, New Homes, which we’ll explore next.
The Clayton Fusion Collection kitchen area.
New Homes Program
The New Homes Program is designed to help MH community owners bring in new homes quickly and profitably while also reducing risk. This platform works at any scale, whether owners need to replace 10 homes or infill 250 lots.
So, that “secret sauce” of the New Homes program is turning the traditionally low-tech process of buying a manufactured home into something fit for the 21st century. The FLOhome proprietary digital platform is how community owners make a splash when it comes to marketing and sales and show future residents that they’re able to deliver essential services online.
Community owners working with the New Homes Program will enjoy many of the same services of the Third Party Property Management program, including:
New Homes Plan
Get assistance in selecting model homes and their floor plans, upgrades and pricing, and ordering advice based on cash flow needs and market conditions.
Sales
Four Leaf trains teams on message delivery and effective sales approaches for phone conversations, in-person tours, financing discussions and ongoing communication. This includes a 10-point home tour approach and using the FLOhome digital platform for capturing sales data.
Management Insights and Reports
Stay on top of leads with tracking from multiple sources, ongoing marketing communication and summary reporting.
About Four Leaf Properties
Four Leaf Companies is a national owner and portfolio operator of manufactured housing communities with a 7,000+ site portfolio. Founders Michael Callaghan and Kevin Shaughnessy are committed to making manufactured housing the affordable home ownership solution for long-term renters, and they use their background in data analytics to do just that. Four Leaf is among the top manufactured home community operators in the U.S. And it is a Clayton Homes NPS Resident Experience award winner.
Buffett and Munger Hold Court, Influence Thousands
OK, I’ll admit it, I was pretty excited when Clayton Homes reached out and offered an invite and press credentials to the annual Berkshire Hathaway Investors Meeting.
Now, I’ve been to my fair share of investors meetings. They’re typically quite staid affairs, attended by the larger institutional investors, a few reporters milling around and listening in. There are hand-bite sandwiches and some soda on ice.
On the other hand, the Berkshire Hathaway Investors Meeting is attended by more than 50,000 people. Little Omaha, Nebraska, for a few days in the spring feels like the center of the universe.
Warning: This Blog Has Little to Do with Manufactured Housing, other than I’ve said Manufactured Housing Twice in This Header
When I contacted the Clayton Homes’ Media Relations Coordinator Ryan Wilson to ask where I might find him once I entered the CenturyLink center, his response set the tone.
“Well,” he said. “This may sound odd, but there’s this giant pickle hanging from the ceiling. If you walk toward that and kind of move along the back wall to the right, you’ll find our area right next to the Yahoo! Finance broadcast stage.”
The giant pickle hanging from the ceiling, of course, was branded with Heinz, a Berkshire Hathaway company. Dozens of other companies owned by Berkshire are represented, too, set up in trade show style but with a retail bent.
Who Comes to the Berkshire Hathaway, What They Find
Investors, even those who own only a single share, can get up to four tickets for the event. They come in droves to purchase specialty products from some of Berkshire Hathaway’s most notable companies… Warren Buffett and Charlie Munger rubber duckies from Oriental Trading Company? A leather shoe from HH Brown that bears a stamp of Buffett’s face? Justin boots; “Walk a mile in Buffett’s boots”. See’s candies. Borsheims fine jewelry. A Dairy Queen dipper. Coca Cola. A set of Fruit of the Looms?
As I walked the exhibition floor where everything is for sale it occurred to me that much of Berkshire Hathaway’s holdings are street level Americana. Wholesome, well understood and established brands with rich history and a wide following.
To that end, Warren Buffett himself is the prime product and service investors and fans come to see. Wholesome, well understood an established brand with rich history and a wide following. All true for the man himself, as well as the brands he seeks and supports.
Bill Tsai, a student of finance at NYU, traveled from the big city to Omaha for a weekend most students would rather be spending at a coastal hideaway.
“We’re in the investing club, and we manage some Berkshire Hathaway shares in our portfolio, and we couldn’t think of a better way to spend the weekend,” Tsai confessed. “One of my friends said ‘This is the rock concert for capitalism’.”
“I’ve been really impressed with the interactions I’ve had here,” he said. “We’re trying to have as many conversations as we can about why people are here and what they do… What it comes down to is people really respect and have a great love for Warren and Charlie and the Berkshire Hathaway approach.”
The Berkshire Hathaway Approach
The “Berkshire Hathaway Approach” Tsai speaks to easily can be summed up as one that involves identifying and investing in strong companies in a way that allows the holding company to let owners and managers continue operating as they have, but perhaps with added resources, not the least of which is cash. And lots of it. As a measure, the BRK-B shares have been hovering around $200 per in recent weeks. The BRK-A share hovers around $300,000… per share.
Kevin Clayton, the CEO of Clayton Homes, a Berkshire Hathaway company for 15 years now, said beyond the cash, a primary resource for his company is Buffett’s thoughtfulness, his even demeanor, and his willingness to participate as company owners and managers see most fit.
The 40,000 people who fill the CenturyLink arena abide. They begin lining up at 4 a.m. on a Saturday to watch a film that provides insight to the values and culture of Berkshire Hathaway. It’s first come, first serve. And every seat is filled. People are leaning in the entry aisles to catch a glimpse. The concourses are filled with people from across the globe who stand in the arena to watch a closed-circuit broadcast of what’s to come.
What is to come is Warren and Munger. Eighty-seven and 94-year-old billionaire investors who will sit on stage sipping soda and snacking on salty bites for nearly seven hours with but one break from investor questions. They answer every one of them, and many of those answers elicit full-belly laughs from the throngs of fans. Not just investors. Fans.
It’s that kind of show.
That’s Warren and Charlie down there
The Long Q&A
Buffett and Munger opened the conversation with an illustration of why investors should look to performing assets, keying in on 300 ounces of gold since March 1942 appreciating from $10,000 to shy of $400,000. That same $10,000 put into what is today’s S&P 500 would be worth better than $51 million.
“Hold a piece of American business,” Warren Buffett said. “And never look at another stock quote… Never listen to another person give you advice… You wouldn’t’ have to understand accounting. You wouldn’t have to look at your quotations every day.
“All you had to do is figure that American was going to do well over time,” he said. “If America did well, American business would do well… You basically just had to make one investment decision in your life.”
Buffett and Munger Flex Comic Sense
The first question of the day, from William Anderson of Salem, Ore., asked Warren about his handing over manager oversight to Ajit Jain and Greg Abel, as well as a significant portions of capital allocation to Ted Weschler and Todd Combs. “Does all of this mean you’re semi-retired?”
“I’ve been semi-retired for decades,” he quipped up front. “Ted and Todd each manage about $12 and $13 billion… and they’re doing a very good job. I still have the responsibility, basically, for the other $300 billion.”
Semi-retired, he says.
Another investor asked about how tumult between the White House and China regarding trade balance may upend international dealings.
“The U.S. and China are going to be the two superpowers of the world, economic and in other ways for a long, long, long time,” he responded. “We have a lot of common interests and like any two big economic entities, there are times when there will be tensions, but it is a win-win situation.”
And with a note on the lucky number 8, and that he will be 88 years old in August, the eighth month in a year ending in 8, the “Oracle of Omaha” even appears open to taking investor tips.
“If you find anything over there for me,” he said about China. “This is the time we should be acquiring something.”
From another questioner, the Berkshire Hathaway duo was asked about crypto-currencies such as bitcoin. Munger intoned first, and clearly is not a fan. He likened crypto to, well, human waste…
“It’s like somebody else is trading turds and you decide you can’t be left out,” Munger said.
Buffett conveyed his appreciation for the fact that many global listeners might be spared of the commentary through, hopefully, a failure to translate.
The Berkshire Hathaway Culture
What these two savvy investors have done for the average person who becomes aware of them is impressive, and during this weekend in Omaha seems entirely encompassing.
I was headed back to the airport Sunday morning for what would be the return half of my wildly inflated domestic flight. Yes, I easily could have flown to Bangkok for this amount. I was on my way out from my $300 per night chain hotel a marathon away from CenturyLink, in an Uber driven by Jason, a retired soldier and inspiring investor.
“My goal this weekend,” Jason said. “My goal this weekend is to make $1,000, and I will drive until I get there. I figure I’m picking up all these people who came here for Berkshire, and I can get some tips and invest that money in the market. Right now I’m thinking GE…”
Denver-based Community Owner Works Deal with Four Leaf Properties
YES! Communities (“YES!”), one of the nation’s largest owners and operators of manufactured home communities, today announced that it had acquired a portfolio of 24 manufactured home communities, comprising over 6,800 residential home sites in the states of Michigan, Indiana, Illinois and Texas, from affiliates of Four Leaf Properties.
As a result of the acquisition, YES!’s portfolio now includes 213 manufactured home communities, comprising over 54,000 home sites in 18 states. While terms of the acquisition were undisclosed, YES! announced that it has completed a total of approximately $450 million in acquisitions so far in 2018, and continues to seek opportunities across the nation.
YES! Communities Celebrates National Operator of the Year Award
YES! further announced that, at the April convention of the Manufactured Housing Institute, the industry’s primary trade group, it was awarded the group’s manufactured home community “Operator of the Year” award for the ninth consecutive year. YES! celebrated its 10th anniversary in January, and has won “Operator of the Year” honors in all but one of those years.
Commenting on the Four Leaf acquisition, Steven Schaub, Chief Executive Officer of YES!, said, “This acquisition of family-oriented properties in solid Midwest markets fits exceptionally well into our portfolio and offers considerable upside potential through the leasing of presently vacant home sites. Consistent with our operating strategy, we intend to add new homes on open sites across the portfolio and invite new residents, both prospective homeowners and home renters, to enjoy the community and resident-focused YES! experience.”
Commenting on the “Operator of the Year” honor, Karen Hamilton, Chief Operating Officer of YES!, said, “We are proud of our YES! team members nationwide, who have once again been honored by their peers for the exceptional service they provide. Their commitment to resident satisfaction and true community building are what make YES! special and we congratulate them on another successful year.”
Debt financing for the Four Leaf transaction included a credit facility from Freddie Mac, arranged by KeyBank. KeyBanc Capital Markets also served as Financial Advisor to YES! in connection with the transaction.
About YES! Communities
YES! Communities is one of the nation’s largest owners and operators of manufactured home communities, with 213 communities across 18 states containing over 54,000 residential home sites. Based in Denver, YES! is a recognized industry leader and winner of the Manufactured Housing Institute’s community “Operator of the Year” award for the last nine consecutive years. For more information about YES!, please visit www.yescommunities.com.
MHVillage continues to be known as the #1 website for advertising your manufactured homes for sale or rent
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Catch the Latest and Greatest in Manufactured Housing Industry News
MHVillage has been and continues to be the first place to go when you look to buy or sell a manufactured home. Over the years we continue to try and top ourselves adding additional advertisement options, and resources for customers. During the last year we’ve put additional focus on being the top resource for manufactured housing industry news.
Our Resources for Manufactured Housing Industry News
This year we launched an industry-only magazine, The MHInsider, offering resources and connections for professionals in our industry.
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Backstage at the Berkshire Hathaway Investor Meeting, Kevin Clayton Reveals His Intentions for The Home of the Future
Kevin Clayton is a man on a mission.
The factory-built home empire his father Jim Clayton built from the mid-’60s is in a unique position today. It’s been 15 years since Warren Buffett rolled Clayton into the Berkshire Hathaway portfolio.
“It’s been better than I expected,” Clayton said of the Berkshire Hathaway relationship. “It’s not just a matter of access to capital.
“I can call Warren any time, and he will pick up,” Clayton said. “I say ‘Do you have a moment?’ and he will say ‘I have as long as you need’.”
Clayton commends Buffett for going on national news to defend the industry, for pointing to its value as the only form of unsubsidized affordable housing. His influence has done as much for the industry as anything in validating the place factory built housing holds.
Attendees at the Berkshire Hathaway Investors Conference mug in front of a digital screen of Warren Buffett’s image
What is at Stake for Kevin Clayton and the MH industry?
Median price for traditional site-built homes is steadily approaching $400,000. Home ownership is at its lowest in 50 years. And retiring Baby Boomers and upcoming millennials need the right place to live.
These factors along with the industry initiative to get financing, zoning, and appraisals on par with site built put the manufactured housing industry in an opportunistic position. But Kevin Clayton won’t concern himself with greater share, not when the company already owns better than 46 percent of the market. It’s the bigger picture that matters.
So, Kevin Clayton is a man on a mission for his industry. For his industry, and his parents.
He points to the idea of factory-built homes that have all the characteristics, look and feel, of traditional site-built homes, able to be placed seamlessly in residential neighborhoods along their site-built counterparts.
“This is what my dad and I have dreamed about for our entire careers,” Clayton said backstage at the annual Berkshire Hathaway Investor Meeting in Omaha Friday. “This is the legacy we want to leave on the industry. And I predict a year from now, we will be able to point to the neighborhoods where this is happening. And there’s no reason it shouldn’t happen.”
“The cool thing is there’s a merging of building on site and building in a factory. All builders are looking to our industry for answers,” he said.
What Media Means to Kevin Clayton and His Company
Clayton very recently launched a media campaign bent on waking potential customers to the idea of factory-built homes. The initial TV commercial espousing the question “Who’s laughing now?” has garnered 37 million views.
They’ve shared the idea of “Have it Made”, and the edgy “Prefabulous”, “Sustainabling” and “Affordabliss” monikers to their target markets.
“It’s elevating our industry in a big way,” Clayton said.
“We were on national football, and we’re getting ready to run in the next few months all the way through Thanksgiving again,” he said. “This time it will be national football but also really targeted at the buyer-decision maker in the household, who many times is the woman of the house.”
The design of the campaign was to elevate all builders, home centers, community owners and homeowners. The drive is to increase the percent that manufactured housing represents in all new housing starts. The industry always has held eight to 10 percent of the new home market.
Angling for the Sentiments of New Home Customers
These industry initiatives are improving the perception of manufactured housing and causing Clayton to upgrade all 40 of its home building facilities. Kevin is encouraging other industry pros to do the same which in turns improves the team member experience resulting in a better customer experience. All this is part of elevating the industry.
“That ties into what our big aspirational goals are, opening doors to a better life,” Clayton said. “We really do want to make homes more affordable and more available for everyone.
“There absolutely is an affordable housing crisis out there,” he said. “The stars are aligning for this industry on a number of fronts right now, and it’s why the GSEs and so many others are really listening to us and want to be part of the solution to solving the low homeownership rate in our country. With rising interest rates and land prices, site-built housing is not in a position to help like manufactured housing.”
new technology from Clayton Homes.
How Clayton Can Attract the Emerging Buyer
For the first time in years, Clayton opted to skip bringing a new model home to the annual shareholders meeting. Rather, they’re pitching their new technologies that help put a potential buyer in a house. The Home Touch™ touchscreen technology being introduced to retail locations this summer, allows shoppers to have a virtual experience, swap out floor plans, and view photos of other home features.
The new technologies connect potential customers to their dream home in a real way much earlier in the home buying process than we’ve seen from this or any other sector.
“I’d like to see our industry stay focused on this New Class of MH which includes the exterior features that the GSE’s, appraisals, and zoning officials want to see. We need to be disciplined and innovative to make these features affordable so MH can be treated on par with other forms of housing. That home with the price tag on it right at the front of the home center facing the highway without any discrimination in how it is financed or appraised will draw a whole new buyer in addition to the important customers we serve today.” – Kevin Clayton, CEO of Clayton Homes
New Buyers Have Different Needs and New Expectations
Millennials, clearly, are a major focus for Clayton and the industry.
“The good news is they’re getting older and having children,” Clayton said of the younger buyers. “They don’t have the same bias against the industry older buyers might have. They are starting to buy homes. And they will buy in a big way, but they don’t want to buy in the same way.
Millennial homebuyers and many others will gravitate to the My Clayton Built Home app, which is currently in development. When released, it will follow those buyers through their path to ownership of that home. The app assists the buyer no matter where they buy or what they buy. It provides updates on the home, maintenance and planning.
Even before the home is placed, the app will tell the customer where their actual home is on the line, in photographs and otherwise to convey how construction is coming together, the processes and materials being used.
“And here’s the thing,” Clayton added. “We know that what the millennial buyer is going to do is share that experience socially, posting pictures and comments, which is great for us and the industry.”
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simply because they provide assistance in the mortgage loan process.
Did you know that MHVillage not only offers home listings, but you can also run Pay-Per-Click ads. In fact, many MH professionals use these ads to catch the eye of homebuyers and homeowners. These ads are simple text ads that appear on MHVillage. In particular, they are great for getting out a particular sales message.
MHVillage continues to be known as the #1 website for advertising your manufactured homes for sale or rent
advertisement options, and resources for customers. During the last year we’ve put additional focus on being the top resource for 
