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Video Interview Documents Quality of Sunshine Manufactured Homes

June 12th, 2015 Comments off

brent_bolding_and_LA_Tony_kovach_at_sunshine_homes__mhpronews_creditMHLIvingNews and MHProNews publisher L. A. “Tony” Kovach interviewed Brent Bolding, head of quality control at Sunshine Homes in Red Bay, Alabama. The interview documents the steps a manufactured home producer must go through in assuring the product is made correctly.

Bolding, a former self-employed businessman, now in his tenth year at Sunshine, says IBTS (Institute for Building Safety and Technology), a third-party contractor with HUD, comes in a couple of times a year to make sure the homes are built to federal standards. “A local inspector comes about every third or fourth day, depending upon our production. He does a report each week that he sends to HUD to let them know we are meeting the guidelines we are supposed to follow.

If he finds something that does not follow the standards, he can pull the label and stop production on that home until it is addressed. But Bolding says the company has been around long enough that that rarely happens. He says there is a check list for each floor that has to be fully filled out, and each house is thoroughly inspected before it is delivered.

I walk this factory front to back everyday looking for any possible violations,” says Bolding. “If I find something that is not right, we fix it right then, we don’t put it off until the next day. It makes us a better company.” As Kovach says, the goal is to make that home conform exactly to the order placed by the customer.

sunshine_home_employees_june_2015The sales slogan for the Packard automobile in its heyday was “Ask the man who owns one.” The same could be said of Sunshine Homes. The company CEO, John Bostick, the general manager and the line supervisor all live in Sunshine Homes. That speaks to the quality of their product.

Bolding says the employees are proud of what they do, they go above and beyond the federal standards to build a home as defect-free as possible. That quality assurance is critical to the HUD Code home buyer and to the overall MH industry. For the video interview, please click here. ##

(Photo credit: MHProNews)

matthew-silver-daily-business-news-mhpronews-comArticle submitted by Matthew J. Silver to Daily Business News-MHProNews.

 

Realtors ® and Manufactured Home Dealers should develop a Symbiotic Relationship

June 5th, 2015 Comments off

saddlebrook_farms_kalamazoo_michiganIn his fourth installment on General Manufactured Housing Industry Topics, MHProNews and MHLivingNews publisher L. A. “Tony” Kovach says getting Realtors ® involved in the sale of manufactured homes can be a mutually profitable proposition. “We believe there is obvious value in having real estate agents who already know manufactured housing and who respect our industry’s value talking to other real estate agents and brokers,” says Kovach.

Linda Hazelhoff shares with Kovach that she has been selling real estate in Kalamazoo, Michigan for 19 years, including hundred of manufactured homes. Her husband is a custom designer and builder, so she is familiar with the real estate industry inside and out. She says inventory is low in her market, and that it is difficult to find anything under $250,000.

She tells other realtors about the quality of manufactured homes, and agrees that home site fees in a land lease community are roughly comparable to homeowner association fees in a condominium setting. Buildable lots in Kalamazoo run from $25,000 to $75,000 and up depending upon the location, which translates into substantial savings living in a land lease community, paying site rent instead of buying the land, in addition to not having real estate taxes on owned land.

Hazelhoff was very complimentary about the quality of manufactured homes, and has forged a long-lasting relationship with Saddlebrook Farms in Kalamazoo, an upscale manufactured home community.

Bobbi Lepi has been in real estate for 35 years in the Zanesville, Ohio. She has 30 agents in her organization selling real estate, doing property management and land sales—acreage, farms and hunting areas. She is in an area where energy exploration is increasing her industrial sales.

She says the world of manufactured homes has come a long way since the mobile home days. “The most amazing thing about (today’s) manufactured housing is the way the space is so well utilized,” says Lepi. Her customers have been very pleased with the quality of the homes and the efficiency of the utilities. She says people come in to an open house and their jaws drop, they did not know MH could be so comparable to a site-built. For sale inventory in her aea is low, and she sees an upsurge in the sale of MH as the Utica Shale exploration continues to expand.

The inventory of homes for sale is low in many areas, driving prices ever higher. The inventory of affordable housing is even lower. The affordability and quality of manufacture homes is at an all time high. The time is now to contact a realtor for a possible mutually beneficial relationship. MH industry professionals know their product, just as realtors know their markets and their customers.

For the complete interviews, click here. ##

(Image credit: Saddlebrook Farms, Kalamazoo, MI)

matthew-silver-daily-business-news-mhpronews-comArticle submitted by Matthew J. Silver to Daily Business News-MHProNews.

Turning Renters to Manufactured Home Buyers

June 4th, 2015 Comments off

rent versus buy   rent-directMHLivingNews and MHProNews publisher L.A. “Tony” Kovach follows the time line formation of renter households versus homeowner households, from the New Deal’s attempts to increase homeownership in 1933 to present day attempts, correlating Fannie Mae and Freddie Mac expansion with economic programs, artificially induced interest rates and subsidies to stimulate home buying.

In the 1990s and into the 2000s there were concerted efforts to extend credit to those with modest means in an attempt to keep the American dream of homeownership alive, to give people hope. The Federal Reserve’s key interest rate was the lowest in 45 years, but lenders got loose with loan standards, which led to homeownership peaking at 69.2 percent in 2004.

However, home prices begin falling as the subprime mortgage industry imploded: bundles of questionable loans were sent around like hot potatoes until the potatoes turned rotten, leading to the Great Recession in 2008. Foreclosures increased, lending standards tightened, home prices bottomed out, employment fell, and many people turned their backs on owning a home, leading to a rise in the rental market.

Although the recession was declared over in June 2009, the recovery of the housing market, which is a major ingredient of a strong economy, has been painfully slow. First-time home buyers historically comprise 40 percent of home sales, but that number has fallen to 30 percent, leading to slack new household formation as Millennials slowly emerge from their parents’ basements and head to rental properties.

Employment has been increasing but wages are flat, and as the demand for rentals increase, so do the rents, putting homeownership further out of reach of many would be homebuyers.

Kovach: “Manufactured housing is ideally suited to tap into this rental market. As we reported last year, the National Association of Realtors (NAR ®) reported that some 85% of renters in a survey said they want to be home owners.

The reason we in MH can make this happen is because we can save them money and give them the lifestyle they want. But it won’t happen without a planned effort that changes perceptions.

John Bostick, CEO and president of Sunshine Homes, encourages manufactured home professionals to get behind Kovach’ MH Alliance-Partners in Progress-effort to help spread the good news about quality MH to the public at large. He says,”We either define ourselves or others will define us. When others define us, it is often to our detriment.

Others have been defining the industry for way too long. It’s time to turn the tables. Average rent nationally is around $1200 a month. Average price of a new manufactured home is $64,000. Do the math.

For the full article, please click here. ##

(Image credit: rentdirect)

matthew-silver-daily-business-news-mhpronews-comArticle submitted by Matthew J. Silver to Daily Business News-MHProNews.

The Path to the Rebirth of the Manufactured Housing Industry

June 3rd, 2015 Comments off

mhi  photo credit  mh under productionThrough a series of interviews with manufactured housing industry professionals, politicians and consumers and a bevy of statistics and graphs, MHLivingNews and MHProNews publisher L. A “Tony” Kovach documents the pitfalls and stumbling blocks that prevent manufactured housing from becoming a major player in meeting the growing need for affordable, unsubsidized housing for many low and middle income residents of the United States. Not only would it provide housing—it would also provide a leg up for people to build equity, achieve independence, a sense of security, and realize the American dream is not just for the one percent at the top, but for everyone.

Alan Amy of Royer Homes in Opelousas, LA, who has been selling manufactured homes for 44 years, says if federal regulations changed, 20,000 more homes would sell immediately. Sam Landy, CEO of UMH Properties, Inc. says his company is doing okay renting manufactured homes. “We lend money to people who have ten percent down and 30 percent of their income covers their lot rent and finance payments. We lend them that money at only eight percent interest rate,” says Landy. He says it’s ridiculous to think they might want to sell a home to someone who cannot afford it. He states, “The current status of the law is, if we made a good faith determination that said someone had the ability to repay, and somebody second-guessed us later, the cost to litigate that would wipe out any profit we made from nine other good deals.

Quality is up, complaints are low, the three largest trade shows are strong and growing, and production, despite the regulatory roadblocks, continues to expand, as MHProNews reported in an earlier story. Both sides of the aisle in Congress as well as consumer groups agree that federal regulations need to be modified.

As Jan Hollingsworth reported in Dodd-Frank and Manufactured Home Financing:The Place where Good Intentions and Unintended Consequences Collide, when Eric Powell tried to borrow $7500 to buy his father’s manufactured home that was sited on family-owned property in Louisiana, because of the Dodd-Frank Act that created the Consumer Financial Protection Bureau (CFPB), despite good credit the only loan he could find was at an interest rate of 35.91 percent. The monthly payment was only $350 a month. Loans under $20,000 on manufactured homes generate as much as $3000 in points and fees to originate because the CFPB classifies them as “high cost,” which drives lenders away.

While former Congressman Barney Frank agrees the measure that bears his name was not intended to affect manufactured home loans as it has, the CFPB ignores industry lenders who have tried to explain how MH lending differs from traditional mortgages. Dick Ernst, involved in MH finance for 40 years, says, “It’s been a three-year battle with CFPB, because they have the discretion to change things. It’s been very discouraging, because they have a certain mindset.” That mindset does not accept that consumers are the ones suffering from not being able to purchase a manufactured home, regardless of the interest rate, the price, or any other factor.

One reason chattel loans bear a higher interest rate is the cost of repossessing a ten to 30 ton home if the buyer should default. Another reason is the lack of a secondary market that could amass a portfolio of loans and spread the costs out over thousands of them. Originators of chattel loans have to carry their own paper.

Kovach says better education of public officials, consumers and the media would go a long way towards correcting the misconceptions that surround the MH industry. Passage of The Preserving Access to Manufactured Housing Act would not only spur the MH industry to build more homes, but that in turn would create jobs and more demand for furnishings and other home goods as well as financial services products.

The federal government is said to spend $40 billion in rent subsidies annually. Says Kovach, “Why not channel those dollars into programs that can yield home ownership via quality, appealing, affordable, energy-saving manufactured housing? Why channel dollars into the hands of those who will keep raising rents, and yield no equity for those millions involved?

Home ownership is the single best path to a higher net worth. For those who say that manufactured homes depreciate, what they fail to consider is that site-built housing dropped like a rock in value when the mortgage crunch hit in 2008. Conventional housing is artificially supported by federal policies and lending support. To deny a similar application to MH is a form of policy discrimination. Leveling the playing field helps consumers, lenders, public coffers, professionals – indeed all involved.

For the complete article, please click here. ##

(Photo credit: Manufactured Housing Institute-new manufactured homes under construction)

matthew-silver-daily-business-news-mhpronews-comArticle submitted by Matthew J. Silver to Daily Business News-MHProNews.

Will Matt Drudge, Fox or CNN Spotlight Unfair Challenges Harming Millions of Manufactured Home Owners?

May 20th, 2015 2 comments

 

Mike-Baker-SeattleTimes-Daniel-Wagner-CenterForPublicIntegrity-hr650-s682-preserving-access-manufactured-housing-act-corrected-mhpronews-com-

Correction on this photo, an earlier version did not have the proper image of Mike Baker, left.

The Seattle Times/Center for Public Integrity has allegedly targeted Clayton Homes and Berkshire-Hathaway affiliated finance companies in an attempt to derail much needed reforms to Dodd-Frank which harm millions of manufactured home (MH) owners and thousands of MH businesses.

Mike Baker and Daniel Wagner – writers of the Seattle Times articles, done in conjunction with the Center for Public Integrity – used shock tactics prior to the House of Representatives vote to attempt to derail the now-passed HR 650, which enjoyed bi-partisan support.

More recently, that writing duo turn on Warren Buffett’s firms again, in advance of a Thursday May 21st vote in the Senate Banking Committee that will include industry sought relief (S 682) from the Consumer Financial Protection Bureau regulations. Industry professionals say that The Preserving Access to Manufactured Housing Act, would mitigate the harm done to the value of millions of low-cost manufactured home owners by the unintended consequences of Dodd-Frank.

It might take a link by billion-plus monthly page views Drudge Report, or media mavens like Fox or CNN, to right the imbalanced coverage spawned by Baker’s and Wagner’s questionable journalism.

Writing in the Seattle Times, Baker says that the default rate on manufactured homes is higher than conventional housing, and uses pejorative terms about the loans such as “predatory” and “risky.” But should 97 home buyers be barred home ownership via financing others won’t offer, so that the 3 who fail in a year be spared their loss?

As a comparison, should millions be stopped from working because a small minority might quit or lose their jobs? Should subscribers to the Seattle Times digital or print publications be barred from buying their brand of news, because some every year will stop paying them? Should their publication be barred from selling ads because some advertisers will stop using them every year?

Yet that is kind of reasoning being used by Baker and Wagner. Their self-evident goal is an attempt to stir up enough shock value that blurs their use of faulty or circle reasoning, aimed at undermining support for much needed Dodd-Frank reforms.

Real Harm to Millions of Real Home Owners and Thousands of Businesses

The Seattle Times and the Center for Public Integrity (CPI) fail to balance their report by pointing out that the loss of lending that has taken place is harming the value of the lowest cost manufactured homes.

Some 20% of the homes that 20 million manufactured home owners live in would sell for under $20,000, the mark that 21st Mortgage Corporation set below which they could not safely make a loan and still hope to profit. With 8.8 million manufactured homes and pre-HUD Code mobile homes in the U.S., that 20% would represent about 1,760,000 manufactured/mobile homes (MH).

Since most MH owners live in their homes an average of about 10 years, millions may not yet realize they are harmed.

Comrades in Arms Against Reform?

Organizations like the Center for Enterprise Development (CFED) are ducking tough questions from MHProNews. Meanwhile, CFED’s Doug Ryan willingly comments to the Seattle Times or OZY Media, why? Are his comments made to other media a desperate effort to shock enough people with headlines and stories that don’t stand up well to close scrutiny? Aren’t CFED and Ishbel Dickens led National Manufactured Home Owners Association (NMHOA) harming the very home owners they claim to be advocating for? Is their ideological stance more important to them than the realities on the ground caused by the polices they advocate?

Dickens sent MHProNews an emailed reply, saying she was on vacation, and thus could not answer questions. Her “vacation” ends after the Senate vote. She can email that she is on vacation, but can’t email a simple reply on the impact of current CFPB regulations on the values of millions of manufactured homes? Or how publishers such as OZY Media are arguably harming the value of MH owners, by using improper and derogatory terminology?

CFPB Regulations harms all current Manufactured Home Lenders

By spotlighting Berkshire-Hathaway affiliated companies, Baker and Wagner are allegedly attempting to derail needed reforms of Dodd-Frank, that impact manufactured home owners and every lender in the manufactured housing space.

don_glisson_2Triad Financial Corporation is a competing company to 21st Mortgage. Triad’s President and CEO, Don Glisson Jr., has told MHProNews that his firm’s costs have skyrocketed since CFPB regulations have gone into effect.

Glisson said, “Triad has been the leading lender in the “A” credit market for over 50 years and I have personally been with the company for over 30 years. Regulations have always been a fact of life for us, but our compliance costs have quadrupled in the past 3 years alone.”

Another industry lender, formerly with US Bank, told MHProNews off-the-record that their bank’s manufactured housing loan program was profitable. But the high costs of regulatory compliance, coupled with low loan volume, caused U.S. Bank to end their manufactured housing lending program. That mirrors the official statement made by the bank when they pulled out of manufactured home lending in November, 2014.

A third manufactured home lender said off-the-record that they are glad 21st Mortgage and Vanderbilt Mortgage and Finance (VMF) make the loans they do. Why? Because in the wake of the 2008 financial collapse, loans on manufactured homes originated by 21st and VMF were crucial to the survival of thousands of MH Industry companies, which included hundreds of independent operations not owned by Berkshire-Hathaway.

Doesn’t the dismal failure to report in a balanced fashion – as Jan Hollingsworth did in writing on the impact of Dodd-Frank on manufactured home buyers and professionals – undermine the credibility of a journalist?

Senior management with every major industry lender MHProNews spoke in favor of reforms on Dodd-Frank, even if they don’t make the same kinds of loans 21st and VMF do.

Triad’s CEO elaborated on the challenges faced by their firm and other manufactured housing professionals. “Since we specialize in A credits, we have never had an issue with higher cost loans and the rules that surround higher priced loans have zero impact on us.”

However,” Glisson stated, “the rule that prohibits a manufactured home retailer from advising the customer on finance options is one that we would like to see changed. Currently a buyer of a site built home can receive advice from their realtor or builder on financing options, while manufactured home buyers have no similar ability to seek a seller’s help. This would be like going to a car dealer to buy a new SUV and when you ask for help securing a loan they hand you the phone book and say they can’t help you so just pick one out yourself.”

Glisson explained what impact this CFPB regulation has made on their operation. “This has doubled the amount of applications we are now processing to do the same amount of lending. In the past, before the CFPB regulations, a retailer could pre-qualify a buyer by accessing their credit reports and analyzing their income, just like every Realtor ® in America can do. With that information, they could at least determine what lender NOT to send the application to. We have had to add several full time equivalent team members to handle the crush of applications, as we are now bombarded with applicants who have no chance of qualifying with us.”

This is a pattern of “shot-gunning” applications by retailers to all MH lenders, to avoid the appearance of steering, that other lenders have confirmed for MHProNews.

Glisson went on to say that, “Beginning in 2014, when the rules went into effect, our origination cost per loan has skyrocketed. Pre-2014 we would approve about 50% of the applications we received as they were pre-screened. Currently we approve about 30% of the applications we receive, so our efficiency went down the tubes and we are working harder and spending more to make the same amount of loans.”

These are the kinds of real world problems caused by federal regulations that cause a lender such as U.S. Bank to pull out.

inside_mh__am_landy

As Sam Landy, President and CEO of UMH Properties pointed out in a video interview linked here, it has caused them and others in the community business to stop lending to potential manufactured home owners. They now rent homes to those who before would be qualified by their finance arm to make renters into home owners. How does that regulatory caused impact help those thousands seeking ownership and equity instead of rent receipts to advance in life?

Doing the Math

Finance experts tell us that a community operator like UMH, using a related or ‘captive finance’ company, can afford to make loans at a lower interest rate than a traditional lender because they are only loaning on manufactured homes in their community. In the event of a default, their costs and thus their loses are lower. Additionally, a manufactured home community operator can benefit even if their loan program is only marginally profitable, because they are getting additional revenue from a sold home and filled homesite.

There is no similar benefit to the third party loans made by 21st, VMF, Triad Financial, CU Factory Built Lending or Mountainside Financial. The same holds true for regional or local lenders who must profit on the loan itself, or they won’t make the loan in the first place.

Does Buffett win more than Millions of home owners would from the proposed reforms to Dodd-Frank?

While the Seattle Times’ Baker and his tag team writer Wagner make it sound that Warren Buffett and Berkshire-Hathaway related companies are the big winner from financial reform, they clearly overlook the real world impact on an estimated 20% of those home owners who live in a home that is worth under $20,000.

If those homes averaged $15,000 each, 1.76 million MHs represent an aggregated value of $26,400,000,000. That sum dwarfs the benefits to Berkshire-Hathaway, or indeed, to the entire manufactured housing industry.

Since financing is the key to most big ticket sales, a loss of financing causes the same drop in value that was seen in conventional housing in the wake of the 2008 mortgage collapse.  Just as conventional housing lost value absent lending, the same holds true for manufactured homes.

As the now-retired president of the Manufactured Housing Association for Regulatory Reform (MHARR), Danny Ghorbani, has said, the factory built home industry was not the cause of the 2008 housing/mortgage bubble. So why were manufactured home owners, housing businesses and professionals penalized? Why is manufactured housing owners and buisnesses taking such a direct hit from the impact of CFPB regulations?

eric_powell_and_family

 As Eric Powell told Jan Hollingsworth about the impact of Dodd-Frank and the CFPB regulations on their manufactured home purchase, What were they thinking when they did that?”  Or as Sam Landy told MHLivingNews, the consequences to millions of manufactured home owners and thousands of business may well have been untended, but someone has got to fix this. ##

(Image credits 3 and 4, MHLivingNews; Don Glisson Jr photo and composite photo and graphic of Baker and Wagner made by MHProNews).

matthew-silver-daily-business-news-mhpronews-comArticle submitted by Matthew J. Silver to Daily Business News-MHProNews.

Rents are Rising—Manufactured Home Living more Reasonable than Ever

May 11th, 2015 Comments off

mhlivingnews__mhpronews__tyson_blattnerA new study of homeownership, home values and income growth from 2000 to 2013 by the National Association of Realtors (NAR) indicates 90 percent of metropolitan housing markets have seen a decline in homeownership rates. Rising home values and static incomes are widening the wealth gap which is leading to more people renting instead of buying homes.

Noting that homeownership has historically been a source of wealth building for middle class families in the U. S., NAR Chief Economist Lawrence Yun states since underwriting standards have become more stringent due to the Great Recession, the homeownership rate has fallen to 63.7 percent, the lowest in 25 years.

As millennials stay in rentals, older citizens downsize to rentals and milllions who lost their homes to foreclosure now rent, the cost of renting is going up. As CNBC tells MHProNews, renters paid $20 billion more in rent in 2014 than in 2013. While homeowners experience wealth growth, renters see increases in housing expense which detracts from wealth.

Changes in wealth are especially noticeable in larger metro areas, like San Jose, California, where homeowners experienced an increase of $210,671 in housing wealth while renters saw their wealth decline as rents rose. Similarly, in Miami, homeowners gained over $50,000 in household wealth from 2000 to 2013 as home values.

As rents and home values continue to rise, the door is opening more and more for manufactured homes as a means to promote homeownership and not experience wealth decline from renting. The average price of a manufacture home is around $64,000 for a new three-bedroom, one bath home, approximately one-third of the average increase of housing wealth in San Jose (italics added). The average price of a new site-built three-bedroom home is around $270,000.

Tyson Blattner, a Purdue University student poised to receive his MBA, lives in New Durham Estates manufactured home community in northwestern Indiana. He understands numbers very well. Click here for his take, on MHLivingNews. ##

(Photo credit: MHLivingNews)

matthew-silver-daily-business-news-mhpronews-comArticle submitted by Matthew J. Silver to Daily Business News-MHProNews.

New Featured Articles Scheduled to Go-Live by 11 PM May 2

May 1st, 2015 Comments off

15-minutes-daily-feed-the-mind-improve-results-shutterstock-ipadcredit-daily-business-news-mhpronews-com-(3)Due to an extended Inside MH Road Show, the prior week at the MHI Congress and Expo, pending special announcements and other factors, the new Featured Articles (FAs) on MHProNews are scheduled to go live by approximately 11 PM May 2nd.

Until then, you’ll find recent articles on MHLivingNews.com, such as:

http://manufacturedhomelivingnews.com/tyson-blattner-purdue-university-grad-student-on-manufactured-home-living-inside-mh-video-interview/

http://manufacturedhomelivingnews.com/who-knows-manufactured-home-reality-the-best/

http://manufacturedhomelivingnews.com/olga-pecanac-olgas-place-westville-indiana-inside-mh-road-show-video-interview/

http://manufacturedhomelivingnews.com/take-another-manufactured-home-tour-inside-mh-road-show-model-video/

http://manufacturedhomelivingnews.com/evan-atkinson-walnut-model-home-tour-inside-mh-video-road-show/

During our recent road show, we captured over 40 video interviews, three manufacturers and multiple retailers and communities, plus dozens of MH home owners and community residents. These videos will help inform the public to better understand and appreciate our homes and industry, directly from those who know it best.

Since all leaders are readers, odds are good that you are or aspire to leadership in your organization and the MH Industry. Our team thanks you for your understanding and dedication to advancing the cause of manufactured housing. ##

(Graphic Credit: Shutterstock/MHProNews.com)

Manufactured Housing may Become the New American Dream

April 28th, 2015 Comments off

mfg home delivery  sfgate  creditWhile many studies have shown that homeownership continues to be a large part of the American Dream, the Joint Center for Housing Studies at Harvard University reports in 2013 home purchases fell for the ninth consecutive year, and homeownership has dropped to 65 percent, the lowest rate in 20 years. Incomes are stagnating, housing values are rising, credit is tight in the wake of the housing crisis and rents are rising in response to demand for rental units.

Although the chronicle-indpendent notes that manufactured housing (MH) has less than a squeaky-clean, all-American, apple-pie image, its price points are appealing, and people like L. A. “Tony” Kovach, publisher of MHProNews and MHLivingNews, who recoils at the words “trailer” and “mobile home,” are determined to bring manufactured homes into the mainstream as the quality and affordable housing alternative.

Since the federal government began regulating design and construction of MH in 1976 with periodic upgrades, quality and safety have increased substantially, and homes often are more energy efficient than site-built homes, with strong wind resistance and increased insulation. Newer ones offer sunken tubs, granite countertops, high-ceiling domed entryways and other appealing features found in more upscale traditional homes. The Census Bureau says the average price for a single-family home in 2013 was $324,000, while an MH average price is $64,000. Even attached garages and covered porches are available with MH, and still considerably less than a stick-built home.

Paul Bradley, president of Resident Owned Communities (ROC), an organization based in New Hampshire that assists residents of manufactured home communities in buying their communities to form co-operatives, sees MH as the future of affordable housing. “The subsidy pie is fixed, and the need is growing,” says Bradley of the current affordable housing stock — which is made up mostly of subsidized apartments. “People will start to look at low-cost production options, it has to happen eventually. ROC USA has helped finance 51 MHCs outside the state to the tune of $90 million, and more inside NH.

Today’s factory-built homes do not necessarily look like single-and-multi-section units that people associate them with. Bill Matchneer, one-time manager of the manufactured housing division at HUD, and former senior counsel with the Consumer Financial Protection Bureau (CFPB), says, “I see the modern manufactured home as equivalent to a typical site-built home, at about half the cost. We’re not talking about a mansion, but people would be surprised.

Marty Lavin, who owns manufactured home communities in New York, says many MH consumers will sacrifice interior quality to obtain more square footage, like substituting solid wood cabinets and doors for particle board in order to increase overall space. “If your financial circumstances are such that you can’t afford a $500,000 home on a quarter acre, a $100,000 home can satisfy your dream. That’s a great thing for many people,” says Lavin.

Many worry about depreciation of manufactured homes, but Datacomp Appraisal Systems completed a study recently of 185 MH in Michigan, comparing the average sale price and resale price, and discovered they are subject to the same factors as other homes. “The appreciation in value of manufactured homes comes back to the old real estate axiom — location, location, location,” read the study. “When properly sited and maintained, manufactured homes will appreciate at the same rate as other homes in surrounding neighborhoods.

Lavin says with rising home prices and stagnating wages, manufactured homes may be the ticket to the American Dream. ##

(Image credit: sfgate-manufactured home delivery)

matthew-silver-daily-business-news-mhpronews-comArticle submitted by Matthew J. Silver to Daily Business News-MHProNews.

H. R. 650 will Lead to More Jobs, More Quality, Affordable Housing

April 13th, 2015 Comments off

manufactured-home   archerland2005 back slash FlickrWriting in Manufactured Home Living News, MHProNews  publisher L. A. “Tony” Kovach says those opposed to the passage of the Preserving Access to Manufactured Housing Act, H. R. 650, which is scheduled to reach the House Floor for a vote this Tuesday, are fueling the mainstream media with misinformation about MH lending and the MH industry in general.

Manufactured housing does have traditional mortgage lending through the VA, FHA, USDA and other sources.  These loans perform about as well as other mortgage loans, a fact that many MH naysayers do not know.

The other form of lending for manufactured homes is personal property loans, often called “chattel loans,” unique to MH, and that is a core issue of H. R. 650. One of the reasons manufactured home loans carry a higher interest rate than a car or boat is because moving a 20 to 50+ ton home once installed is expensive and requires expertise, if repossession becomes necessary. They are no longer “mobile homes,” a term that expired when the federal government began enforcing production standards on June 15, 1976. Modern MH cannot be hooked up to a trailer hitch by a pick up truck or car and get pulled away.

Contemporary manufactured housing is stronger, safer, more energy-efficient, greener and less costly than conventional housing,” says Kovach. Models run from entry level styles of 400 square feet up to custom-made two-story residential styles, but all are durable, made to HUD Code standards, and often exceed the quality of conventional houses, per a video interview with prior federal MH program director, Bill Matchneer, JD.

Just like any other business in the U. S. economy, lenders must be paid for their service and need a profit. However, even with somewhat higher interest rates on chattel loans, monthly payments on MH are lower than site-built homes. The U. S. Census Bureau states a manufactured home costs half as much as an on-site built home. As noted and linked above, former head of HUD Code for the MH construction and safety program, Bill Matchneer, says new MH is as well-or better- built than moderately priced site built homes.

Large banks and small community banks that once made profitable loans on MH have stopped due to current federal regulations under the Consumer Financial Protection Bureau (CFPB). MH retailer Alan Amy said his business has been curtailed by 30 to 40 percent due to the regulations.

Kovach cites estimates from MHI that each new MH home built would create one additional job, so changes brought about by HR 650 could yield about 22,400 new jobs. 

One of the inadvertent effects of the Dodd-Frank Act, as later pointed out by co-author and now former U. S. Representative Barney Frank, is its limiting of MH sales. As Kovach says, “Due to regulations and processing expenses, the cost to ‘originate’ or make a $50,000 loan on a factory-built home is about the same as making a loan on a $250,000 site-built house. There are little or no closing costs on an MH home-only loan. When you factor in the tax, and other money-saving factors, MH personal property lending is more competitive to land-home than a mere interest rate makes it look.

Additionally, the SAFE ACT prevents MH retailers from even suggesting the possibilities of lending options, where to turn for lending. “Consumer protection” in this case is a misnomer. Most people who own older, low-cost MH likely do not know they cannot obtain a loan for $20,000 to $25,000 because of CFPB regulations. These are the most affordable homes, and, in many cases the most vulnerable citizens. The same “consumer protection” likewise forces lenders out of a market they want to serve.

The National Association of Realtors, the Mortgage Bankers Association and the National Association of Credit Unions have all signed on to H. R. 650. This measure will help millions, create jobs and provide for more quality, affordable housing. Don’t be misled by the misguided mainstream media. For Kovach’s full report, see this link here. ##

(Photo credit: archerland 2005/flickr–manufactured home)

matthew-silver-daily-business-news-mhpronews-com  Article submitted by Matthew J. Silver to Daily Business News-MHProNews.

Article on Manufactured Homes and High Winds Gets it Wrong

April 1st, 2015 Comments off

hurricane   corbis photos creditAccording to what newsobserver reports from North Carolina regarding deadly tornadoes, “While the perception might be that tornadoes target trailers, the reality is that manufactured housing is the least safe place to be in severe weather, second only to an automobile. It’s just that simple.” In fact, it is not that simple.

A video sponsored by the American Modern Insurance Group on NBC’s Today Show, July 23, 2014, clearly documents a high wind-rated HUD Code home installed on a permanent foundation resisting wind storms better than surrounding site-built homes, seen here on MHLivingNews.

NBC‘s Kerry Sanders explained that 80 percent of severe damage to manufactured homes is caused by carports or patio covers that have been improperly installed. If the homes’ roof and that of an add-on are connected inadequately, winds may rip both off of the home.

Manufactured homes are frequently in rural areas, and in some cases are damaged or destroyed when a tree falls on the home, or other debris smashes into the home..

The article continues: “So, why are mobile homes so unsafe? They are not considered sturdy shelters because of the materials used in their manufacture and the fact that they roll easily. Straight line winds of around 75-80 miles per hour can roll a trailer just as easily as rotating winds in a tornado.

If it is truly a mobile home produced before June 15, 1976 when the Department of Housing and Urban Development (HUD) set standards for the construction of manufactured homes, and the home is not anchored to the ground, there might be some truth here. But it would be comparable to being involved in an auto accident and not wearing a seat belt.

As MHProNews knows, interchangeably using “trailers,” “mobile homes,” and “manufactured homes” to describe the same thing is totally incorrect. ##

(Photo credit: corbisphotos)

matthew-silver-daily-business-news-mhpronews-com  Article submitted by Matthew J. Silver to Daily Business News-MHProNews.