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Home > Affordable Housing, Analysis and Commentary, Business, Company News, housing, Manufactured Housing Industry, News Item, People, regulation, Stocks > Buffett’s Clayton Buys Yet Another Builder, Growing Dominance in U.S. Housing Market

Buffett’s Clayton Buys Yet Another Builder, Growing Dominance in U.S. Housing Market

July 10th, 2017
BuffettBerkshireHathawayClaytonHomesPropertyGroupHarrisDoyleHomesBerkshireHathawayHomeServicesDailyBusinessNewsMHProNews

Russ Doyle (left) and Brooks Harris, founder-principals in Harris Doyle Homes. Right hand photo, still from video on this page, below.

Last week, the Daily Business News on MHProNews was the first in manufactured housing to report that Berkshire Hathaway’s Clayton Property Group added Colorado based Oakwood Homes to their expanding site-built housing portfolio.

Now, Keith Holdbrooks, president of Clayton home building group, has another announcement.

We are proud to welcome Harris Doyle to our family of homebuilders,” Holdbrooks said in a press release.

Builder noted today that “In his 2017 letter to shareholders of Berkshire Hathaway, ceo [sic] Warren Buffett gave a shout-out to Berkshire’s Maryville, Tenn.-based Clayton Homes group and the fact that it had closed on its first three “site-built” home building operators by the end of 2016.”

Adding that, “More will come,” Buffett promised. “Site-built houses are expected to amount to 3% or so of Clayton’s unit sales in 2017 and will likely deliver about 14% of its dollar volume.”

What Others Are Often Overlooking…

While those involved in the construction trades understandably focus on the site-built or factory home building, what is going largely unmentioned is that Warren Buffett’s Berkshire Hathaway has also gone into the real estate business in a substantial way. Berkshire Hathaway HomeServices.

In a release, Berkshire Hathaway Home Services had this to say.

Irvine, CA-based HSF Affiliates LLC operates Berkshire Hathaway HomeServices, Prudential Real Estate and Real Living Real Estate franchise networks. The company is a joint venture of which HomeServices of America, Inc., the nation’s second-largest, full-service residential brokerage firm, is a majority owner. HomeServices of America is an affiliate of world-renowned Berkshire Hathaway Inc.”

 

Combined with their substantial – and growing? – presence in the housing building and remodeling supply chain, Buffett’s Berkshire – is growing in several directions.  Known within the factory built home industry for being the parent for the largest HUD Code builder, Clayton Homes, plus 21st Mortgage and Vanderbilt Mortgage.

Among other brands, Buffett’s strong presence in Wells Fargo and other banking units that do manufactured home, as well as conventional house loans.  Bloomberg and Business Insider reported last April that Buffett had to cut his stake to under 10 percent of Wells Fargo, in order to get around concerns raised by the Federal Reserve.

Back to Clayton’s Newest Buy…

Clayton, a Berkshire Hathaway company and one of America’s largest homebuilders, today announced it has acquired Harris Doyle Homes, a leading residential developer and home builder for the greater Birmingham, Ala., area, effective July 7, 2017,” stated the Clayton release.

Harris Doyle Homes is the fifth homebuilding acquisition for Clayton since 2015 and the second homebuilder acquired this month,” Clayton said.

The release pointed out that Clayton built “In 2016, Clayton built more than 42,000 homes.”  While it didn’t say how many were HUD Code, the industry total for last year was some 81,100 new manufactured homes.

FHFAFannieMaeFreddieMacGSEDutyToServeManufacturedHousingIndustryDailyBusinessNewsMHProNews7102017

To see the special Sunday evening report on this time sensitive topic, click the image above. Want more lending? Email your thoughts and comments on the GSEs plan to ‘serve’ manufactured housing. You can submit electronically to FHFA at the link shown below.

What impact will this trend have on manufactured housing, and the Manufactured Housing Institute (MHI)?

A growing number of professionals are emailing or calling MHProNews, whispering their concerns about possible “conflicts of interest.” Given that Buffett’s brands now hold two of the four executive committee positions at MHI, will Berkshire’s ever-growing presence in conventional housing influence the industry in ways that may not be for the good of most other HUD Code producers, or independent retailers, communities, and others?

What do these non-factory built housing units under the Buffett banner mean to industry efforts such as the Duty to Serve and if these are more evidence of conflicts of interest for MHI’s dominant player? ## (News, analysis.)

(Image credits are as shown above, and when provided by third parties, are shared under fair use guidelines.)

SoheylaKovachManufacturedHomeLivingNewsManufacturedHousingIndustryDailyBusinessNewsMHProNews-Submitted by Soheyla Kovach to the Daily Business News for MHProNews.com.


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