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Bloomberg – Manufactured Home Industry is the Solution to the Affordable Housing Crisis

September 23rd, 2016 Comments off
Sunshine_Homes__credit

The single section home is featured in a video on MHLivingNews. The Energy Star ™ would often sell in the low 50s, has 3 bedroom, 2 baths and is thus lower in cost than what the Bloomberg story shows as the average price. Image, Sunshine Homes, Red Bay, AL.

An article in Bloomberg makes the case that manufactured homes – what they refered to as mobile homes (sic), are an obvious solution to the affordable housing crisis.

It starts with a simple question: Why Aren’t We Building More Mobile Homes?” While their terminology isn’t exactly accurate – and they admit that mobile homes aren’t very mobile – their message is clear.  The manufactured home industry provides real hope for the American Dream of home ownership at a reasonable price.

Bloomberg’s article shares metrics that show people in West Virginia accepted delivery of more than 1,000 manufactured homes last year, while 2,000 conventional builders secured permits to for new single family homes. This means that 1 in 3 homes added in the state last year was a manufactured home.

The more facts one sees, the more apparent the solution becomes, as MH professionals know.

The average sales price of a manufactured home was $67,800 in April, 2016. By contrast, the average sales price for a site-built home in the same month was  $380,000. While the manufactured home was priced without land, even factoring land cost in creates an amazing savings.

According the stats in the Bloomberg article, 75% of manufactured homes residents have household incomes of less than $40,000 per year.

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Bloomberg means, HUD Code Manufacturd Homes, not mobile homes, but the stats are useful. Credit, Bloomberg.

While the graphic shown above cites that most of the manufactured homes are highly concentrated in southern states (where the bulk of sales have been,) there are over 500,000 manufactured homes in California, which has pushed aggressive regulation that continues to affect the ability to own a home.

While those of us in the industry can see growth, it’s not always as clear to those outside of manufactured housing, due to long insufficiently addressed lingering perceptions.

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Bloomberg cites age, loose lending practices and the fact the manufactured home sales peaked in the mid 90’s – when they made up 1 in 3 homes sold nationwide – among reasons they think MH loans started to go bad, flooding the market with foreclosures and thus limiting demand.

While MH is years into its recovery, the data also shows that manufactured home sales have been slower to recover from the last recession than other forms of housing.

Bloomberg points to Doug Ryan, director of affordable home ownership at the Corporation for Enterprise Development (CFED – a Washington-based nonprofit group,) who cites advantages, and challenges, that the industry faces.

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Doug Ryan, CFED.

You can put them anywhere you have the land, said Ryan. As the Daily Business News recently reported, CFED’s Ryan routinely promotes manufactured homes as an important option in the affordable housing crisis.

What you’re up against is the stigma. You’d have people coming to the planning meetings and saying that you’re killing their home value.” The Daily Business News has covered this scenario playing out in Austin recently.

The Bloomberg piece ends with something for the industry to think about:

Maybe it’s time for another rebrand. The homes vary in size and price, but they’re generally smaller than the typical site-built home. Instead of “manufactured,” why not borrow the name for another kind of often prefabricated abode: the tiny house.”

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Narrative control, it seems, is everything in the fight for the American dream.  As regular readers know, MHProNews and MHLivingNews, we’ve extensively covered the many ways that the MH industry is the solution to the housing affordability crisis in the U.S.

Underscoring Bloomberg’s tip to the MH Industry?  Rebrand them as tiny houses, which are hot. ##

(Image credits are as shown above.)

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RC WIlliams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News, MHProNews

SILVAR President Tonna says Internet, Education key for Today’s Home Buyers

August 24th, 2014 Comments off

silvar-president-david-tonna-senator-feinstein-constituent-breakfast-posted-daily-business-news-mhmsm-com-David Tonna, President of the Silicon Valley Association of Realtors (SILVAR), is on a mission to educate today’s home buyers, MercuryNews  tells  MHProNews. Some 90% of all home buyers begin their home shopping online. Most search for a property for 6 months before they contact a real estate agent. But home buying is more than facts found online, because there is both information and misconceptions found on the web.

Tonna says he spends no less than 90 minutes with a future buyer upon their first meeting. He says, “Homeownership is an investment in your future and offers immediate benefits and long-term value. Realtors are trusted resources for the most up-to-date, comprehensive and accurate real estate information because they know the communities, see many homes and can help buyers successfully navigate the increasingly complex buying process.”

Buyers are asked to describe their ideal home, lifestyle, schooling needs, commute goals and their location/community amenities. Tonna presents buyers with a bound manual outlining the buying process, including the complexity of their home search, offer(s), escrow, contingencies and closing. Then they go over forms the buyers will encounter. “This process takes the mystery out of home purchasing,” Tonna stated.

Tonna notes the internet may bring international buyers. He also contends that Realtors ® do more than generic real estate agents or online information alone, because websites can’t replace a Realtor ®. “The process I describe illustrates that Realtors are not simply order takers for properties they found on the Internet and visited at an open house. It raises the level of our professionalism in our industry,” says Tonna.

SILVAR and Tonna stay politically engaged as well, he’s pictured above at California’s U.S. Senator Dianne Feinstein constituent breakfast.

As regular MHProNews readers know, many of these same points apply to manufactured and modular housing. The need for professionalism routinely starts with a good online engagement strategy, but must include trained and motivated professionals who deal with prospective buyers with an appealing customer service and education approach. Given the widespread misinformation about manufactured homes, more best practices methods and online engagement must take place to attract increasing numbers of qualified home buyers. ##

(Photo credit: SILVAR)

Each $1k Rise in Home Price Equals 200k fewer Buyers

August 5th, 2014 Comments off

mortgage ates   caudium  ceditAccording to a new study by the National Association of Home Builders (NAHB), for every $1,000 increase in the cost of a new median-priced home, 206,000 more prospective buyers are forced out of the marketplace. Among the states, the number of households that would no longer qualify for a mortgage based on a $1,000 increase to a median-priced home range from a low of 313 in Wyoming to a high of 18,250 in Texas. While the number of households affected varies across states and metro areas, and largely depends on population, income distribution and new home prices, the report contains detailed figures for over 300 metro areas. Measuring metro areas, as MHProNews has learned, the number of households that would be priced out of the market based on a $1,000 increase range from a low of 19 in Napa, Calif. to a high of 5,742 in the New York-Northern New Jersey-Long Island, N.Y.-N.J.-Pa. area. ##

(Image credit: caudium.com)

Builder Confidence Nudges Up One Point

April 16th, 2014 Comments off

Builder confidence in the market for newly built, single-family homes rose one point to 47 in April following a March reading of 46 on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). Based on a survey the NAHB has been utilizing for 30 years, the HMI gauges builders perceptions of current single-family home sales, expectations of sales for the coming six months and traffic rate of prospective buyers. “Job growth is proceeding at a solid pace, mortgage interest rates remain historically low and home prices are affordable,” said NAHB Chief Economist David Crowe. “While these factors point to a gradual improvement in housing demand, headwinds that are holding up a more robust recovery include ongoing tight credit conditions for home buyers and the fact that builders in many markets are facing a limited availability of lots and labor.” Regionally, as MHProNews has learned, the West posted a nine point decline, the Midwest witnessed a fall of four points, while the Northeast and South each fell two points.

(Photo credit: theglobeandmail.com–prospective homebuyers)

NAHB: Housing Numbers Showing Modest Rise

April 8th, 2014 Comments off

Statistics from the National Association of Home Builders (NAHB) indicate modest improvement this month over March, and anticipates a traditional, solid, spring home-buying season. Based on employment, permits and price data, the NAHB/First American Leading Markets Index (LMI) reports 28 percent of metro areas experienced a rise in their score this month, and 83 percent saw a rise within the last year. Baton Rouge, LA tops the list of large metro LMI areas, MHProNews.com has learned, followed by Honolulu, Oklahoma City, Austin and Houston, Texas, San Jose, CA. and Harrisburg, PA. Smaller metro areas with strong LMIs are centered around energy exploration sites such as Odessa and Midland, Texas, and western North Dakota. ##

(Image credit: etftrends.com)

Study Ranks Home Buyers based on Ethnicity

March 13th, 2014 Comments off

A survey conducted by the National Association of Home Builders (NAHB) in 2013 reveals housing data based on ethnic and racial considerations. The information could be valuable to builders when dealing with potential customers, as MHProNews.com has learned.

  • Minority home buyers typically purchase a home at a younger age than whites: The median African-American buyers is 39, the Hispanic buyer is 37, the Asian buyer is 36 while the white buyer waits unit 43.
  • At least half of all purchasers in all ethnic/racial groups are married couples and most have children: 80 percent of white buyers, 50 percent of African-Americans, 74 percent of Hispanics, and 79 percent of Asians.
  • In terms of median household income of all four groups, Asian home buyers rank first with $72,797, followed by whites with $67,747, $50,221 for Hispanics and $43,774 for African-Americans. ##
  • (Photo credit: theglobenadmail.com–homebuyers)

Potential Home Buyers Shift Attention to Holiday Shopping

December 6th, 2013 Comments off

The number of people looking to buy a home in November dropped seven percent from October, but it was less than the 11 percent drop for the same period last year, according to what Redfin tells nationalmortgagenews. Meanwhile, eleven percent fewer people signed offers in Nov. over Oct., but an improvement over the 14 percent decline for the same month-to-month in 2012. But as MHProNews has learned, tours were down 28 percent the week of Thanksgiving from the previous week, and offers fell 23 percent. Additionally, mortgage applications declined 13 percent that same week, seasonally adjusted, with a four percent drop in purchase applications, according to the Mortgage Bankers Association (MBA).

(Image credit: hansafx)

Iowa Climbing Back from Low Manufactured Home Sales

August 5th, 2013 Comments off

While the manufactured housing industry continues to recover, it still has a long way to go, according to Troy Hames of Hames Homes in Marion, Iowa. Noting the company has sold manufactured homes for 44 years in east central Iowa, Hames says new home sales in the state were 2,200 in 1996 but only 220 in 2012 and are expected to rise to 280 this year. The company also owns five manufactured home communities with a 90 percent occupancy rate, about 1,200 families, but 80 percent of sales are for previously-owned homes, thegazette informs MHProNews. Joe Kelly, executive vice president of the Iowa Manufactured Housing Association (IMHA), states financing has always been tough for manufactured home buyers, but the economic downturn combined with consumers taking advantage of low mortgage rates to buy site-built homes has made matters worse. Kelly says while there is pending legislation in Congress to ease lending for manufactured homes, he does not expect matters to change anytime soon.

(Photo credit: Adam Wesley/thegazette–Troy Hames entering a manufactured home)

Most Housing Market News is Good, except…

August 1st, 2013 Comments off

The latest data from Harvard University’s Joint Center for Housing Studies reports the rise in housing prices, while lauded by many, is driving many potential home buyers out of the market because incomes are not rising along with home prices. From 2001 to 2011 the number of households paying over 50 percent of their income for housing rose 6.7 million, an increase of 49 percent. This rise in households (includes renters) severely burdened has hit record highs, just as millions of federal rent subsidies will expire over the next ten years. As MHProNews has learned from creditwritedowns.com, the market is demanding one million new residential units annually. If construction cannot keep up this pace, home prices and rents will continue to rise, and if incomes do not then rise, the housing cost burden will spread to more households.

(Image credit: shutterstock–deflated)

Center for Housing Studies says Housing Recovery is Real

July 29th, 2013 Comments off

While the Census Bureau says home ownership is at its lowest point in 15 years, Harvard University’s Joint Center for Housing Studies reports “After across-the-board declines in 2011, all major house price indexes registered significant increases in 2012.” As documentation, the Center says the March 2013 median house price was up 11.6 percent over March 2012, and as of April 2013, home prices have risen in all except two states and in 94 of 100 major metropolitan markets. Between Q4 2011 and Q4 2012, the number of underwater borrowers dropped 1.7 million to 10.4 million, which represents 23 percent of all mortgage holders. Further, as philly.com informs MHProNews, the rise in prices resulted from increased sales and fewer listings. April 2013 marked the 34th consecutive month of rent increases as ranked by the Consumer Price Index, and last year rental households grew by 1.1 million. Eric S. Belsky, the joint center’s managing director, says, “Even as historically low interest rates have helped make the monthly cost of owning a home more favorable than any time in the past 40 years, the national homeownership rate fell for the eighth straight year in 2012.” He adds, noting the challenges still ahead, “Long-term vacancies are at elevated levels in a number of places, millions of owners are still struggling to make their mortgage payments, and credit conditions for home buyers remain extremely tight.”

(Photo credit: knoxnews)