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Apartments vs. Manufactured Housing, NMHC and NAR Data, Opportunities

August 18th, 2018 Comments off

 

ApartmentsVsManufacturedHomesNMHCNARDataOpportunitiesDailyBusinessNewsMHProNEws

National Multifamily Housing Council® (NMHC) and National Association or Realtors® (NAR) are the sources for bulk of the data and graphics, shown below.

 

The executive summary could be captured with a statement made by Scholastica ‘Gay’ Cororaton, Certified Business Economist (CBE), with the National Association of Realtors® (NAR).

MonthlyMedianGrossRent2016HousingTypesManufacturedHomesScholasticaGayCororatonNARDailYBusinessNEwsMHproNews

Note there seems to be a difference between NAR and NMHC data on median rents.

She said “Based on 2016 latest data, the median household income among manufactured homeowners was $43,900, about half the median household income among all homeowners.  The median household income of manufactured homeowners is about the same as the median income of all renters, at $42,500. This indicates that renters can transition to homeownership without significant change in housing expenses via ownership of a manufactured home, if other factors that homebuyers look for are also met (e.g., accessible transportation, presence of a good school, other neighborhood qualities).”

Let’s start with the age of multifamily housing rental units, which many may find surprising.

Why?

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Because out of 19.506 million apartment units, using NMHC data, 10.316 million were built after 1980.

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So, over 9 million units were built before 1980, with 2.137 million units built on or before 1939.

NMHCAptMedianRentNMHCDailyBusinessNewsMHProNews

Note there seems to be a difference between NAR and NMHC data on median rents.

Cororaton’s data reveals that it would be a simple budgetary change to go from an apartment to a manufactured home.  Her data also shows the appreciation possible in a modern manufactured home.

ComparisonMonthlyPaymentsChattleLandHomeMixedVsConventionalExistingHomesNARScholasticGayCororatonDailYBusinessNewsMHProNews

By contrast, there is obviously no equity in an apartment rental.  So there’s about 225 percent more apartments than manufactured homes. Since turnover is steady in apartments, that’s a vast market opportunity.

DTIRatiosConventionVsManufacturedHomesNARSchoalsticaCororatonApartment construction is booming.

HousingAppreciationByLoanTypeManufacturedHomesScholasticaGayCororatonNARDailyBusinessNewsMHProNews

Like RVs, they are out-performing manufactured homes by a country mile.

What RV Industry’s 2018, Prior Results Reveal for Manufactured Housing

The RV report, linked above, reminds professional readers and investors that RVs trailed manufactured housing in 1998.  20 years later, they are outselling manufactured homes by some 5 to 1. See that report to learn more.  It’s opportunity in disguise for those who see it, and get it.

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Graphic, data, per Sun Communities (SUI).

There is a need for every kind of housing that exists.  Some need or want a short- to medium-term rental. But with hundreds, if not thousands, of manufactured home communities offering rentals, that too could be a market for the manufactured housing industry.

When Bloomberg, NAR and others are increasingly featuring positive news about manufactured homes, that should make investors sit up and take notice.

Bloomberg “New Home for $90,000? Manufactured Housing Is Making a Comeback” Reveals MH Media Challenge

Even high rises could be done with manufactured homes, when density is an issue. See that related report, linked below.

So manufactured homes are a common-sense choice. Millennials and others must be shown why they are a cool, even savvy, option.

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Learn more about the above, linked here.

Perhaps these are among the reasons why the Blackstone Group has recently entered the manufactured home space? See that in the related reports, linked below.

Notice: We plan an upcoming report on MHLivingNews on this issue, designed for the general public.  Sign up herein seconds for our industry-leading, typically x2 weekly, emailed headline news updates. “We Provide, You Decide.”  © ## (News, analysis, and expert commentary.)

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L. A. “Tony” Kovach and his wife Soheyla co-founded and publish the manufactured home industry’s two leading tradeLATonyKovachMHLivingNewsMHProNewsPublisherIndustryExpertConsultant

media; Manufactured Home Living News (MHLivingNews.com) and MHProNews.com for business professionals and investors.

Kovach’s work has been featured in publications such as the Washington D.C.’s The Hill, Value Penguin, Chicago Sun Times, and a host of other media. He’s been involved in the manufactured home industry as a manager, high-volume retail center owner, consultant, and publisher for over 25 years. Kovach has likely interviewed more industry professionals, experts, and manufactured home owners, than anyone in U.S. news media.

 

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Related Reports:

Blackstone Brilliantly Bets Big On Manufactured Housing, Enters Manufactured Home Communities Contest

High-Rise Manufactured Home Stackable Towers, Compete with Modular/PreFabs, Density at Lower Cost

 

Fresh Facts, Figures, Future of Affordable Housing -Comparisons- Conventional Site-Built v Mobile/Manufactured Home Industry Data

“Thou Shall Not Steal,” $2 Trillion Annually Lost to Lack of Affordable Homes, Making the Manufactured Home Case

 

Warren Buffett Would be Okay With Clayton Homes Losing Money, Says Kevin Clayton – But Why?

Manufactured Housing Shipment Totals, June 2018

Blackstone Brilliantly Bets Big On Manufactured Housing, Enters Manufactured Home Communities Contest

July 27th, 2018 Comments off

 BlackstoneGroupBXEntersManufacturedHousingBigBuyManufacturedHomeCommunitiesTriconLifestyleLogoDailyBusinessNewsMHProNews550x315

 

Blackstone Group LP has made its first bet on manufactured housing by buying a portfolio of communities sold by Tricon Capital Group Inc., according to people with knowledge of the matter,” said Bloomberg earlier today.

As the Daily Business News on MHProNews reported earlier this month, Tricon sold their portfolio to an undisclosed buyer.  Bloomberg says that buyer is The Blackstone Group (BX).

Sale of $172 Million Manufactured Home Community Portfolio Completed

“…a principal investor and asset manager focused on the residential real estate industry, has completed the previously-announced sale of its 14-park manufactured housing investment vertical known as Tricon Lifestyle Communities (“TLC”) to an institutional asset manager for a gross transaction value of approximately $172 million.”

A Blackstone representative declined to comment and a Tricon representative didn’t respond to requests for comment,” said Bloomberg.

Manufactured housing communities are comprised of prefabricated homes often located near common facilities such as pools and recreation halls. This area of real estate is in favor with investors, in part because of the rising costs of homebuilding. The average price of a new manufactured home in the U.S. was $73,400, according to U.S. Census Bureau data that was last updated in February,” was Bloomberg’s better-than-average mainstream media description of the industry.

Blackstone isn’t the first institutional investor to dive into manufactured housing,” their report correctly noted. “Singapore’s sovereign wealth fund GIC Pte. in 2016 was part of a group that acquired a majority stake in YES! Communities.”

TriconLifestyleCommunitiesManufacturedHousingLandLeaseBusinessDailyBusinessNewsMHProNews

Tricon announced that they planed ‘an orderly exit’ from manufactured home communities in 2018, per a 2017 company statement. The details of that deal are now becoming more clear.  Given their size, this has the potential to be as significant to the industry as Berkshire Hathaway’s entry into manufactured housing in 2003. 

Centerbridge Partners LP was an early investor in Carefree Communities Inc., which was acquired by Sun Communities Inc. in 2016. Apollo Global Management LLC owns a majority stake in Gold River, California-based Inspire Communities and Carlyle Group LP has also been active in the sector,” wrote Bloomberg’s Gillian Tan.

Evercore ISI analysts said in a note this month that they expect manufactured housing fundamentals to remain strong,” said Tan, “with projected core same-store net operating income growth of 4 percent to 4.5 percent annually over the next three years, substantially above the 2.5 percent average growth the firm expects from U.S. real estate investment trusts.”

Equity LifeStyle Properties Inc. and Sun Communities, two REITs with sizable exposure to manufactured housing, have both outperformed the Bloomberg U.S. REITs Index over the past 12 months,” per Tan’s report.

 

About Blackstone

Our investments are designed to preserve and grow our limited partners’ capital, provide financial security for millions of retirees, sovereign wealth funds, and other institutional and individual investors, and contribute to overall economic growth,” per the “Who We Are” on their corporate website.

Blackstone is one of the world’s leading investment firms. We seek to create positive economic impact and long-term value for our investors, the companies we invest in, and the communities in which we work. We do this by using extraordinary people and flexible capital to help companies solve problems. The firm was founded in 1985 by Stephen A. Schwarzman, our Chairman and Chief Executive Officer, and Peter G. Peterson, who retired as Senior Chairman in 2008,” per the company.

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Thirty years later, we are a firm of nearly 2,300 employees in 25 offices worldwide. Our portfolio companies employ more than 460,000 people across the globe,” which also touts that “At Blackstone, we apply our capabilities as a leading global investment firm to deliver solutions, unlock value and propel growth. The capital we deploy on behalf of our investors fuels the development of businesses and communities. The investments we make are the wellsprings of future opportunity. Through this work, we seek to ensure a secure retirement for millions.”

Blackstone has been added to our Daily Business News evening closing ticker for manufactured home industry connected tracked stocks.

For those not yet familiar with the appeal to the manufactured home industry, or the communities sector, the related reports further below will prove insightful. “We Provide, You Decide.” © ## (News, analysis, and commentary.)

(Third-party images and content are provided under fair use guidelines.) See Related Reports, linked further below.

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SoheylaKovachDailyBusinessNewsMHProNewsMHLivingNewsSubmitted by Soheyla Kovach to the Daily Business News for MHProNews.com. Soheyla is a managing member of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.

 

 

 

 

 

Related Reports:

Realtor University, Journal for the Center of Real Estate Studies, Makes Corrections– “The Market for Manufactured Homes,” by Scholastica ‘Gay’ Cororaton, CBE

Harvard’s Joint Center for Housing Studies 2018 – Affordability, Manufactured Homes, and Modular Housing Report

Hundreds of New Manufactured Home Communities Opened, But How Many Have Closed? Industry Research Result$

“Why Advocates Need to Rethink Manufactured Home Quality,” Harvard, GSE, Genz, “High Satisfaction”

 

Investors Looking to Cash in on Housing Market Rebirth

February 5th, 2013 Comments off

CNNMoney tells MHProNews investors are dashing to buy assets in every aspect of the housing supply chain—builders, undeveloped land, foreclosed homes, and building suppliers. Paulson and Co. has bought enough land in three western states to build up to 25,000 homes and is looking for more. Blackstone Group (BX) shelled out $2.7 billion last year to acquire 17,000 single-family foreclosed homes, and continues to hunt. Silver Bay Realty Trust (SBY) has already purchased 2,500 homes in areas pounded by the housing crisis and is on the lookout for 3,100 more homes. Brad Geisen, CEO of Foreclosure.com, has seen strong interest from investors in the last three months trying to buy quantities of foreclosed homes. He says, “A lot of investors see a short window of opportunity where there’s good inventory on the market at bottom market prices. No one knows how long it will last, so these investors are trying to buy as much as they can right now.”

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