Posts Tagged ‘renter households’

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.

Harvard Study Cites Critical Shortage of Affordable Housing

July 5th, 2013 Comments off

According to the State of the Nation’s Housing report released by Harvard University’s Joint Center on Housing Studies, the housing recovery is well underway, but the millions of borrowers delinquent on their mortgages or underwater continue to pull at the edges of the recovery. In addition, the number of renter households grew in 2012 by 1.1 million, the second year of double-digit growth in the rental market. As that sector increases, homeownership declines, MHProNews has learned from appliancemagazine. The report states, “With rising home prices helping to revive household balance sheets and expanding residential construction adding to job growth, the housing sector is finally providing a much needed boost to the economy. But 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 homebuyers remain extremely tight. It will take time for these problems to subside. Given the profoundly positive impact that decent and affordable housing can have on the lives of individuals, families, and entire communities, efforts to address these urgent concerns as well as longstanding housing affordability challenges should be among the nation’s highest priorities.”

(Image credit: Fotosearch–homeownership)

Rental Market Continues to Expand

June 13th, 2013 Comments off

According to the National Association of Realtors (NAR), five to six million renter households will be created within the next ten years, as reported in HousingWire. The Census Bureau says renting households increased substantially from 2008 to 39 million, and that number will rise to 41 million in two years. Residential renter Real Property Management doubled in size during the last two years, and expects to add 60-80 franchises this year, and 100 next year. As the inventory of homes for sale remains thin and location is a dominant factor, families may choose to rent if they cannot find a house in the desired neighborhood to purchase. CEO Wally Chernoff of Rent Range states of single-family renters, 97 percent rank a safe neighborhood as important while 84 percent say school is critical. MHProNews published a story yesterday in which UMH CEO Sam Landy says the occupancy rate at the company’s 68 manufactured home communities has risen due to the strength of the rental market. As a result, UMH plans to add 200 rentals this year.

(Photo credit: apartmentquest)

Housing Becoming More Expensive

March 15th, 2013 Comments off informs MHProNews Eric Belsky, managing director of the Joint Center for Housing Studies at Harvard University, says in 2010 more than 25 percent of renter households paid over 50 percent of their income for rent, an increase from 20 percent in 2000, putting more people at the risk of homelessness. A study by the National Low Income Housing Coalition estimates employees need to earn $18.79 an hour for rent to remain at 30 percent or less of income, but the average hourly wage is $14.32. Belsky says this often translates into insufficient money for food, healthcare, and other expenses, limiting the economic impact on the local community.

(Photo credit: zimbio)