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Posts Tagged ‘industry voices’

The Importance for Businesses and Investors in Manufactured Housing for Selecting the Next Supreme Court Justice

June 30th, 2018 No comments

Predictability in law is the key to a prosperous Republic. Laws must be interpreted based on the language in them first and foremost. Only, when the language is unclear, should a judge seek evidence on related legislative discourse and legislative intent at the time the law was passed to help interpret it. Otherwise, law risks becoming whatever a particular Judge or powerful person/group wants it to be.

This was the consistent judicial philosophy of former Justice Antonin Scalia, and often adopted by Justice Kennedy.

Seeking Justices who interpret the laws based on their personal conclusion of what culture wants or what one Legislator said about a law, or what the law means in another country, results in the creation of different law created by the Judicial Branch, the branch of government neither elected by nor accountable to the people.

PredictabilityInLawIstheKeyToAPropserousRepublicKurtKelleyManufacturedHousingIndustryDailyBusinessNewsMHProNews

Illustrations like the above and the headline are supplied by the editor of MHProNews, which is customary for a guest column. The text supplied are the unedited, thoughtful words of Kurt Kelley, delivered via email, on the topic of the importance of who will replace Justice Anthony “Tony” Kennedy on the nation’s high court.

Justice Sotomayor’s recent dissent opinion regarding the “President Trump Travel Ban” is an example of the danger of violating Scalia’s decision formula. She based her emotional opinion on what she viewed as President Trump’s intent as evidenced by select things President Trump said while campaigning, versus what the law specifically said in plain English. Justice Sotomayor concluded the law was a ban on all Muslims entering the United States. However, the “Trump Travel Ban” neither states this nor is it applied in such fashion by Border Control. ##

KurtKelleyJDMobileAgencyMHRManufacturedHousingIndustryVoicesMHProNewsKurt Kelley, J.D.
Mobile Agency, MHR
The Woodlands, Texas

 

 

Others are invited to sound off on this, or other industry topics.

Related Report:

“I Hate Politics!” – Bedminster Watch, and Manufactured Housing Shipments

State Association Quits Membership in Manufactured Housing Institute (MHI), Explains in Writing, Why?

February 9th, 2018 No comments

The manufactured housing industry has long been a mainstay of affordable housing in the United States.  For decades the industry has provided an unmatched quality of life with an affordability not seen in any other sector of the housing market.  The homes and the land lease communities in which they are situated have become fixtures across the country providing an affordable, quality lifestyle to all segments of our population.  Over the years it has seen its ups and downs, but has been able to survive and even thrive through the difficult times.  The greatest hindrance and the greatest threat to the industry is not the economy, the homes or the communities, it is governmental interference and over regulation. 

The Manufactured Housing Communities of Arizona (MHCA) is a statewide association representing community owners in Arizona.  As state associations do, the MHCA has been very active and productive at the state level in combatting governmental interference with its burdensome regulations and obstacles.  At the state level most community owner associations have been able to not only monitor proposed local and statewide legislation, but interact with legislators to prevent onerous regulations that are detrimental to our industry.

The MHCA had joined a national association in hopes that we would get the same representation and effectiveness at a national level.  The national legislation and rule making over the last ten years has proven that we do not have that representation.  One only has to look at the passage of the Safe Act and the Dodd-Frank Act to see how devastating and onerous national legislation can be.  Other similar chattel groups (the RV industry) saw the proposals and their representation managed to have them exempted.  The national organization to which we belonged was apparently unaware of the legislation and its ramifications until after passage and it was already being implemented.  The rule making in the aftermath has been horrendous and little if anything has been done to stop the bleeding.  Recently, HUD has issued rules concerning the screening of prospective tenants for our communities.  Again, we find no one aware of what is happening, much less advocating on our behalf.  Installation requirements are being implemented that have no basis in common sense and the result will be additional burdens on community owners and added costs for homeowners.

Due to the lack of effective representation at a national level, the MHCA withdrew its membership from the national association to pursue other avenues of representation. We are not the only state association to do so.  The MHCA has been exploring other options; including hiring a lobbying firm that is prominent in Washington, D.C. 

MHCommunitiesOfAZNealTHaneyPresidentWhyTheyQuitManufacturedHousingInstituteMHIDailyBusinessNewsMHProNews737x214

In some cases, the state associations represent community owners only and in others there is a single association representing all aspects of the industry.  We need a national association to advocate on behalf of community owners.  It does not need to be an association with conferences to attend or one that requires numerous meetings and publications.  Such an association needs to be very narrowly focused on monitoring proposed legislation and rule making.  We need someone to advocate on behalf of the community owners.  This singular task needs to be done at the congressional level and in the departments that make policy affecting our industry.  Every community owner, and every association that is accepting membership dues from community owners, should be concerned with the lack of representation at the national level and should be involved in finding adequate representation.  If you are willing to be a part of the solution, please contact our association office.

Manufactured Housing Communities of Arizona
2158 N Gilbert Road, Ste. 116
Mesa AZ 85203
Phone: 480.345.4202, Toll free 800.351.3350

You may also email our Executive Director Susan Brenton at: sbrenton@azmhca.com.

Thank you for your consideration on how you can help shape the future of our industry.

Sincerely, 

Neal T Haney,
President


##

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A Much Better Way for FEMA, Taxpayers, Says Manufactured Home Industry Professional

September 17th, 2017 No comments

I expect that all manufacturers, while agreeing with The Stafford Act, believe there is a much better way. Respect for the taxpayer certainly does not appear considered with many government purchases. 

To serve those affected by disaster, we should, but most believe we can:

Save the taxpayer money with an adjusted set of requirements, to build MHU units via the HUD code but omit the sprinkler system requirement and many other overreaching requirements. The savings are significant.

ControversiesErruptFEMAPressesHUDCodeBuildersManufacturedHomeRetailersIndustryProsReactMHProNews

These comments were shared in response to the story linked above, click for details. Off the record comments are a time-honored tradition in media, which we respect. Naturally, MHProNews routinely seeks to discern how valid (or not) a claim may be, and strives to publish only those that meets that discernment process standards. 

Save the taxpayer money by eliminating the need for storage yards through the ability to build with inventory manufacturers know they can procure and build almost immediately. The units could go immediately to FEMAs set disaster location and be immediately deployed. The savings could be significant.

Save the taxpayer money by disallowing MHU units to be pulled wherever, whenever and back again. With the ability to expedite production, this unnecessary transportation can go away. The savings could be significant

Save the taxpayer money through a warranty provision that is not punitive for minor cosmetics. Who cares? What family would be ungrateful for an MHU unit with A few blemishes? The savings to FEMA, would be significant. Manufacturers would not have to hedge.

Save the taxpayer money by streamlining the inspection processes, the IPIAs that are trusted to inspect/approve our industry’s homes that are bought by hardworking Americans with lenders respecting the loans should be able to inspect Temporary housing units. The savings would be significant.

Establish a requirement for care by the residents occupying the unit to protect it, just like any landlord might do. Design the floor plans for resale where the loss for purchase to liquidation is not so excessive.

There is much, much more that could be considered.

It is not FEMA’s money. It is the taxpayers. I believe our industry believes in a better way!

Please keep me off the record. Thanks.” ##

DefiningSICinJournalismDailyBusinessNewsMHProNews-com

iReportManufacturedHomeHousingIndustryMHProNewsTipsLogoGraphic(Editor’s Note: the above is from a respected veteran of the manufactured housing industry known by this publisher.  It came in response to the report linked here. Due to the sensitive nature of his role, he has requested anonymity, which we routinely honor.  The typos are in the original, and we opted not to use the SIC graphic where they occurred. There will be a follow up report on the Daily Business News on a related issue Monday morning, Sept 17, at about 3:04 PM ET. Other reports will follow. )

Our experience with Resident Owned Communities – no BS

January 15th, 2014 No comments

The “No BS about Resident Owned Communities” article that appears on this site brings to mind President George W. Bush’s comment while visiting Canada in 2004:

I would like to thank all you Canadians for your warm welcome at the airport. Especially those of you who waved (pause) with all five fingers.”

I get it. We have a successful business model that is reshaping resident ownership and that invites reactions from competitors.

I stand by our record of performance to prove we have a lot of five-finger waves and cheers in the marketplace for ROC USA® as we’ve closed:

  • 13 resident-owned community (ROC) purchases in 2013;
  • 12 in 2012; and,
  • 11 in 2011.

In fact, we have closed a ROC transaction every 37 days on average since we launched in 2008.

We got there by being 100-percent focused on making resident ownership effective and efficient and successful. The marketplace is the true judge.

One of the keys to our success is that we don’t have to chase capital to finance resident purchases. We have already raised all the financing the resident corporation needs — including funds for deposits and due diligence — in a U.S. Department of Treasury-certified Community Development Financial Institution.

We have current liquidity to finance $40 million of resident purchases today. No one else in resident ownership services has raised capital in advance the way we have. We did it so we could create a different transaction experience for buyers and sellers.

We’re not simply brokers who get paid at closing and walk away — we equip homeowners with the tools and training they need to successfully manage their communities. The fact is that we care about each community’s long-term performance and we know every democratic association needs leadership development and cost-effective shared services to be competitive. ROC USA has a national leadership institute for ROC leaders, a national marketing program for ROCs, and an online and in-person training system to help ROCs and ROC leaders succeed.

At ROC USA, we use the limited equity co-op for simple reasons: It is the most effective and efficient, the fairest and the most affordable model for homeowners. We stand by our work of the last 30 years with more than 140 ROCs that we took from tenants to owners.

Not one of those communities has failed.

That 30-year track record demonstrates the competency and capacity of ROC members and leaders with whom we work.

Every one of these ROCs is real ownership where each homeowner can purchase one low-cost membership interest in the corporation that owns and controls the MHC. There are no outside parties with an ownership interest in the co-op or the MHC, only the homeowners can be member owners.

ROC USA is a nonprofit and thus must serve low- and moderate-income communities, but that doesn’t limit us to small communities. Our largest completed transaction was a two-MHC portfolio transaction worth $23 million for nearly 500 home-sites in 2012. Further, and not surprisingly, every MHC we’ve worked in has sufficient numbers of low- and moderate-income — that’s not an issue.

We don’t apologize for being well-funded or widely publicized. Getting things done attracts interest and attention. Every closed transaction gets a press release and we send postcards to announce purchases. Often we’ll quote the community owner or the broker. Here are two recent ones:

The business model that ROC USA has developed is superb. It was a different transaction in that you usually have to jump through a litany of different hoops in regard to banks and bank regulations. But that simply wasn’t the case here. I would certainly do it again, and I will.”

Joel Erlitz, Broker,
First Commercial Property Corp.

 

“It’s no different than a sale to any third-party.”

Phil Johnson,
Seller in Minnesota

ROC USA does not practice public policy. In fact, we eliminated the part-time policy position at ROC USA in 201l.

We’re out earning our way in the marketplace — just like you.

That’s how we ROC ‘n’ roll. ##

paul-bradley-rocusa-president-posted-industry-voices-manufactured-housing-pro-news-com-.jpgPaul Bradley, President
ROC USA, LLC
pbradley@rocusa.org / 603-856-0709

(Editor's Note: this article comes as a response by the Paul Bradley to the Featured Article entitled No BS about Resident Owned Communities.

Other perspectives on this topic or any that impact manufactured housing are welcome. Please put OpEd, Letter to the Editor or Industry Voices in your subject line and send proposed article to – latonyk@gmail.com and/or iReportMHNewsTips@MHMSM.com – thank you.

As an additional reminder, we welcome tips on topics and local/regional/national/international news that impacts factory built housing. Readers like you can be and are a part of the story here! )

Rent Control in MHCs

September 4th, 2013 1 comment

Tony,

The phone rang one morning and a young man returned my call to him, we'd been playing phone tag. I had left a message with his wife in Oregon earlier, and he was calling about two Vermont MH communities I have listed for sale. From the voice of each, I guessed they were both far younger than I.

Speaking with him, as I answered his questions, it was obvious this was not his first call on LLCs for sale. In a knowledgeable way he wound thru the obvious questions, finally asking whether Vermont LLCs are rent controlled. Yes, I explained, they are. I went on to explain Vermont allows CPI, about 3% annually presently, without concern, and a big one, allows provable capital improvements in addition, annually. I told him that as a former VT LLC owner I had found the scheme fully workable, as do many of my contemporaries.

The next day I got an email message saying he and his partner/wife had decided not to invest in any locale where rent control is in force. OK, I get it, but that removes quite a swath of locales, many which are hot purchase markets. This philosophy allows investment in say Mississippi or Alabama, but negates purchases in Florida or much of California. Oh…

After that, my mind wondered over my experiences of the dangers of rent control and lack of it. Yes, I said the danger of the lack of it. I actually was pretty young once, had hundreds of apartments and almost 2000 MH/RV sites. With the exception of a Florida LLC, I was in no jurisdiction where rent control was in effect. And when rent control was threatened in a jurisdiction, I was the first to the battlements opposing its imposition. I was and am a capitalist, and rent control seemed an anathema to my beliefs. I'm not alone, right?

But time went by, slowly the days passed, and some of my beliefs at 40 years of age made transition to a more measured understanding as I aged and acquired experience I previously lacked. Let me be frank, I was an accomplished and notorious rent increaser, which in my twilight years brings me no acclaim by others, and more importantly, myself.

What I found was that in apartments, and we're not speaking of New York City here, the market rents in an area kinda act as rent control. You find yourself as the top dog in rent rate for your 1000 sq. ft three bedroom apartment in your area. What you are very likely to find, as I did, your apartment rents last and less, staying empty longer than it should. Recovering the lost time and money brings you back to Earth and unless your calqy is busted, your late debt payments slap Hai Karate hard. I found apartments very self correcting as to rents.

Now, on to LLCs. We all know the reasons we invest in communities; they own the dwelling unit, they can't move the house, etc. All good stuff, of course. So as I bought LLCs from original owner/developers, I found that as longtime owners they had allowed their rents to slip behind the market, keeping their management easy, with many long term residents.

Of course, the purchase price always reflected the oft unspoken premium of raising rents to market. "Hell, they can pay a lot more than that!" So I paid more than cash flow to get the community, not real unusual, right? Then the rent increases started. Often stiff and early increases happened shortly after closing.

The first few increases were swallowed, albeit with plenty of bitching by residents. We raised rents as much in two-three years as the former owner did in 10 years. Note that in some instances the increased rent still didn't pay for the capitalized investment costs. I knew that, they only knew and cared their rent had doubled in short order. No esoteric explanations of cap rates and other MH investor jargon seemed particularly persuasive to the LLC residents.

Who was it, Newton, who theorized every action has an equal and opposite reaction? I raised rents, they moved out. And I acquired a reputation in that community as a rapacious rent increaser. And these reputations are hard to escape. I wouldn't really care that much except the reputation had a very bad impact on homesite rentals. That, I did care about.

At first I did the calculation I see many others doing. Yah, I had 100 homes at $100 per month, and even though I'm quickly down to 90 homes at $111 per month, hey, I'm getting the same money with less work and expenses. And it keeps going this way as rents increase, residents fleeing like a torrent, out the MH Paradise Estates gates, which has turned into Hell Bent Acres.  And as vacancies mount, you lose control of the community, no longer able to count on the desire to live in your LLC to keep people in line. And that desire includes pricing.

Were I the only one to have followed the raise-rents protocols, then only I would have suffered the residue, but of course, such was not the case. The MH industry's then flawed model, subsidized for years by flawed lenders, finally collapsed, dropping from 373,000 shipments in 1998, then tantalizing us into believing the hurricane-inspired 135,000 shipments of the mid 2000s was the stopping point, to the grim reality of 50,000 homes in the 2010s. Yah, I hear 60,000 homes could happen any day now.

I sat in on some very contentious MHI committees in the late 2000s era trying to formulate a chattel long term lease the GSEs could swallow. In concert with this I reviewed many LLC profiles showing monthly rent and occupancy. It probably won't surprise you that the vacancy was truly scary, yet rents occurred steeply and frequently.  I had already tried that, and even with the generous retail financing by GreenTree, CIT, The Associates, Security Pacific, Chase and their ilk, it didn't work. Now we were dealing with the GSEs, who I did not find stupid, and we were trying to equate rents in LLCs to the capitalized valuation of single family conventional real estate lots. Any thought of sharply limiting rent increases to gain long term and low rate financing being the trade-off, got serious push back. Such was not to be and by then as the effort lost all bouyancy, the GSEs woke up to far bigger challenges.

As a post script I am the very first to admit that some major figures in that committee have since come far closer to the rent restraints advocated in the long term lease effort as their stated belief for industry resuscitation.  Will that be enough? I greatly doubt it, but I sure think it is an indisputable industry wide measure in the road back to something other than Warren Buffett's table scraps.

So to my young friend in Oregon, rent control, other then confiscatory NYC apartments or some California cities in MH, can be a useful LLC owner restraint, quieting some of the early animal spirits we can all exhibit before experience shackles us. Did I like going to the rent hearings in my community in Florida and taking phallus down the throat to the gag control center? Oh, I loved it.

Still, Florida LLCs are and have long been highly prized acquisitions, not greatly injured by the relatively manageable process for raising rents.  With the relatively benign rent control such as in Florida and Vermont, you and the industry are actually protected from many of the practices employed in the industry, leading to so much push back against us.

Before you believe I'm asking you to petition your jurisdiction for rent control, let me disabuse of that notion. Nothing could be further from the truth. I rail against governmental intrusion in to my affairs daily. Everyday the beast grows larger, only a financial collapse likely to abort its growth. The only point I am making is that one must practice rental increase restraint on your own. Sometimes laws can help a process.

The flip side is that lack of restraint causes lack of residents at a time LLC vacancy nationwide forebodes another step down in industry size. In places like Vermont and Florida and others, rent control, which one should practice on their own, is instilled by statute. Perhaps not the best solution, but the record says the world did not end there.

Yes, we tell a great story which seemingly has legs of truth about our affordable housing heritage. But for whatever reason, even though its great dog food, the dogs won't eat it. Perhaps a legacy of rapacious rent increases, closing parks, high default rates and high home value depreciation could be a good place to start the industry resurgence. We build great homes, but my friends, that, by itself is not enough. ##

marty-lavin-posted-on-mhpronews(MARTIN V. LAVIN
attorney, consultant & expert witness
350 Main Street Suite 100
BURLINGTON, VERMONT 05401-3413

802-660-8888 off / 802-238-7777 cell
marty@martylavin.com

(Editor's note: The hot link was added by us, not Marty, nor was the link requested in any way by Marty. We think it is good for others to realize that while Marty is 'retired,' he is still involved in this industry and clearly cares about manufactured housing deeply. That is why he sounds off on issues, because he cares enough to raise them for discussion, thought and action.

As always, letters and articles by you or your colleagues that may agree or take other perspectives are encouraged. Send them to latonyk@gmail.com with Industry Voices Guest Column in the subject line. )

Getting Zuckered! Lessons Learned.

June 6th, 2012 No comments

(Editor's note: in every monthly issue of our Featured Articles, 6-12+ articles we receive are not published – at least at that time – for a variety of reasons, including logistical ones. That is what happened to this article for June. But when the following news item linked below about Facebook came up, we felt this article was worth sharing on Industry Voices, our thanks to MB, please enjoy.http://www.cnbc.com/id/47674474)

The handwriting was on the wall when Warren Buffett said – before Facebook's (FB) over-hyped IPO – that he wasn't going to buy; certainly not at the start. GM had just pulled 10 million in annual ads on the FB site. FBs own public offering statements indicated that the advertising model was not working yet as planned. Some experts think the true value of FB might be under ten dollars a share, not in the thirties. But some buy into hype. It had less to do with NASDAQ's errors – as serious as those were – than the simple fact that FB was overpriced.

But what's undervalued?

Manufactured housing.

Why?

Failure to properly promote! The failure to create millions of Raving Fans!

The proof is hidden in the FB experience.

The hype about FB came in part as a result of millions of raving fans.

You have tens of millions of potential customers today and tens of millions more tomorrow for manufactured housing. Those Manufactured HomeOwners have to become believers. MH Owners have to be so happy, that friends tell friends, and then businesses like yours grows like crazy.

What are you going to do about it? ##

Posted for
Michael Barnabas

Dick Moore’s Industry and Finance Perspective

November 16th, 2011 2 comments

 

Dick Moore's Industry and Finance Perspective
 
Well, it seems that I struck a nerve with our friend up East. He mostly disappeared for a couple of years, quit writing his newsletter, and went dormant. I figured maybe his conscience was bothering him, after the spin he put on our industry.
 
Now I see a new post from our buddy in “Industry Voices,” the guest platform on Tony Kovach’s e-zine MHMSM NewsLine (MHMSM.com = MHProNews.com), wherein he goes on and on about me in a general mis-representation of my writings. I certainly never opinioned that he had powers akin to Superman. He did, however, invent some mystical losses derived by using losses from Brigadier, Conseco, and other lenders who did not know or understand how to buy MH paper. He then reported those loss figures to Fannie Mae & Freddie Mac, keeping them out of the (Manufactured Housing) markets.
 
This lack of competition had a negative impact on the other lenders that were still major players in our industry.
 
He admitted to me in Louisville one year that he was an “attorney” and was being “paid” by Fannie to advise them. He later denied all that, but everyone knows the credibility of lawyers and politicians. After all, who else gets “paid to have an opinion”?
 
My ex-neighbor was a college professor who taught business
administration at Memphis State University. After listening to his
many goofy ideas and theories, I realized the source of the old adage “If you can’t do it, teach it.” If you were a failure in the finance business, then go out and advise others how to do it!
 
The Mortgage Industry produced paper much worse than the MH
industry ever dreamed of, and that was the paper that our friend
advised Fannie to buy (instead of MH paper). Fannie’s losses are the worst losses the United States has ever endured, and it continues still. (How good was that advice?)
 
It is easy to measure or analyze a situation the way you
want it to look – just choose the measuring criteria needed
to give you the end result you want and ignore any thing
that doesn’t.
 
The MH Industry (its survivors) remains the only low-cost housing that is un-subsidized. Just because less qualified people enter the business and lose money from their poor business decisions does not equate to a ‘subsidy.’ Maybe our friend does not know or understand what a subsidy is. He sounds like Obama explaining the debt ceiling and how someone else created it.
 
I’m sure there will be another argumentative letter, but I have work to do and do not have the time to continue with fruitless exercises in writing.
 
********
 
This industry and its recourse lenders fared well and made good money from the 50’s to the 90’s, with no taxpayer subsidies.
 
This industry faces a number of problems, with the main one being lack of financing. The lenders and the learned professors of the industry like to blame the dealer for all the woes. True, we have had some bad apples in our business, just like every other industry. But the level of damage from that kind of dealer falls way short of the debacle we as an industry are paying for now.
 
One major issue our industry faces concerns resale values of our houses, which directly affects the lender’s recovery on defaulted loans. We as dealers have very little influence in that arena.
 
Many MH Communities will not accept houses over 10 years old; lenders will not finance homes over 10 years old. Somehow, when the house hits its 10th birthday, it suddenly is worth ZERO!?!?! And this is the dealer’s fault?!?!
 
When free enterprise existed in this country and banks lent money to their dealers with recourse, our industry performed well! Lenders were selective about who they would take on (based on the dealer’s financial condition and track record in the community), the dealers would take care of their funding pipeline by not sending them dead-beats (since the
dealer would have to repurchase if the loan fell out), and the dealers were paid endorsement fees for this guaranty. The dealers worked to re-sell the bank’s repos with good unpaid balances, and the paper overall performed quite well. It was that performance that led to the influx of the non-recourse lenders that we saw in the 90’s.
 
Long-gone lenders such as Bombardier, Conseco, Greenpoint Credit, BAHS, et al, saw the performance of recourse lenders’ portfolios, due to good resale values on houses sold under recourse agreements, and made the mental jump to they can do that too! Soon tactics such as withholding of proceeds and diverting rate spread and the odd-days’ interest into non-interest bearing reserve accounts became the norm from the lenders, at the expense of their MH dealer network.
 
In their headlong rush for gold, they also opened the funding gates to credit buyers who (like in today’s meltdown) had NO reason in their track records to get approved for loans at low rates and low down payments.
 
So, they kept the endorsement fees, put that rate spread into a reserve account for repossessions, and bought non-recourse.
 
Their inability to manage the repos, refurb and re-sell them (as the recourse lender/dealer relationships had done) created massive losses for them. Again, I fail to understand how this is the dealer’s fault.
 
********
 
President Obama is railing against corporate jets, while flying around on the most expensive jet in the world. The tax deductions on all the corporate jets in the US would not pay for Air Force One. Is this leading by example or “Do as I say, not as I do?”
 
Good leaders lead by example. They don’t accept favors from lobbyists and major contributors to their re-election campaigns, and they don’t spend the taxpayers’ money recklessly.
 
The crash of the housing/mortgage industry was caused by Fannie Mae and Freddie Mac, which is govt. money invested into private enterprise, wherein all the profits go to the cronies of powerful govt. people, but the risks and losses go to the taxpayers. # #
 
post submitted by
R. C. “Dick” Moore

The Emperor has no Clothes

August 21st, 2011 13 comments

There is a lot to say about what has gone wrong with our country and our Industry.  We will begin ‘at the top,’ with our Chief Executive, President Barack Obama.

What’s up with Obama’s recent bus tour?

I’m no fan of the prior president, but say what you will about President W, when he took a similar bus trip to President Obama’s, W used campaign dollars to pay for it.  Where is the “watchdog” media? Why no hue and cry when the administration buys millions of dollars of Canadian buses so President BO can tour in style on the taxpayer’s dime?

What’s up with all that?

Isn’t it ironic that BO tours campaign style after lecturing millionaires and billionaires about private jets and corporate perks?  Or is that rhetoric just a way of getting the votes of middle America and ‘the little people?’

Do you like ‘divide and conquer politics?  To me, it is plain wrong.  Talk about issues, talk records or about facts.  But don’t pit one group against another.

I need to be clear that W vacationed considerably more than BO.  But W went to his ranch or Camp David, etc.  But to add irony to injury, on the heels of all this bad economic news, BO is in Martha’s Vineyard – the haven of the elite – now?

Even left wing commentators see this vacation in the New England playground of the rich and famous as a problem.

  • Experts and government statistics suggest we have 17% unemployed and under-employed.
  • We have more people on food-stamps and welfare than at any time in U.S. history.
  • And BO will give us his ‘next’ jobs program in September, after his resort vacation?
  • Where are all those shovel ready and other jobs from the ‘first’ one?  Or were all the jobs ‘created’ at the job killing CFPB?

They say the emperor has no clothes.  Well, we have no emperor, but a president and his wardrobe looks just fine.

Ascendancy and Dependency

It is the party of dependency that is still in ascendency.

Or at least still in high office…

…dependency is a major voting block today.

Be it government labor unions, federal jobs or those on government assistance, it is an issue.  We have to put people to work, not get them used to no work. We do need federal and other government jobs.  But we can’t give everyone a job regulating someone who is working to produce a product or a service that keeps America’s wheels turning.

If we do not change our ways federally and locally, we will look like rioting old England some day, because we can’t afford to keep adding to our debt and taking on more programs that fail to foster independence.

While we have plenty of dependency programs, meanwhile, we have

  • flash mobs that form, rob, harass and harm others in our cities.
  • We have automatic weapons fire along our southern border.
  • We have three wars we are involved in instead of the previous two.

I didn’t favor W taking us into Iraq, nor do I favor BO taking us into Libya.  Even if we ‘win,’ what have we won in either case?  We spill American blood and treasure, for what?  We can’t be the world’s cop, and we can’t have wars for the sake of foreign oil, etc.

Let’s drill and do energy on U.S. soil and off U.S. shores, as safely and prudently as possible.  Think about the major jobs creation potential.

Private enterprise can pay for it all without federal dollars.  Let business people do business in America again.

Another Recession, whats up with that?

The media speaks of double dip recession.  What’s up with that phrase?

Did anyone notice that the ‘great recession’ never ended?  Did you notice that the housing markets still suffer, and Keynesian/Euro socialist economics just added trillions to our debt without giving us a stronger economy?

No jobs.  No stimulated business.  Tougher lending.  Very little respect overseas.  Where is the change we can believe in?  Or was that supposed to mean the pocket change we have left after taxes?

Third part candidate George Wallace once said there wasn’t a dime’s worth of difference between the two major parties. Thus Wallace favored what some have for years, a third party to bring America back. But Ronald Reagan had it closer, we don’t need a third party, but a rejuvenated second party.

That means we don’t need Rino Republicans, Republicans In Name Only.  To me, W was a Rino, socially conservative, but nearly as much a man about big government as BO is.  W helped give us that darn bail out of the bankers.  W took us into two wars with no end in sight.  W’s dad may not have “finished the job” in the first Gulf War, but he had the smarts to get in and get out.

We need business friendly independents, Democrats and Republicans.

Businesses create jobs.  Jobs are what American’s need, and then they can start buying houses again!

Speaking of jobs, how about creating 20 million new ones?

I’ve read the same reports you have; that there are two trillion dollars of investment money on the sidelines – actually overseas – that could be brought back to the U.S. In short order.

But that 2 trillion fled America due to regulations and tax policies.  Do we have the political will to bring those trillions back?

Think about what Two Trillion Dollars we don’t have to borrow, or write down, would mean to our country right now.  If every $100,000 invested created only 1 American job, that would mean 20,000,000 jobs.

Think: 20 million people off aid, off food stamps, off unemployment or other government programs.  2o million more taxpayers.  Think 20 million people less dependent, means we would be that much closer to a balanced budget!

We better find and support candidates in whatever party who know how the free enterprise system works, because creating jobs by supporting business is what we should be about.

Free Enterprise, not Keynesian/Euro socialist economics, is what made America the land of the free and the home of the brave.

November 2012 is shaping up now.  Who we support now for our state houses, or for Congress, the Senate and the White House will be on the ballot 15 months from now.

Personally, I’ve contacted my senators and representative and made my feelings known on economic and social issues.  But I will also make them known on the path to election 2012.

Give the man his props

One thing that our recently bus touring and now vacationing BO has done is give us an executive order we can believe in.  With all due respect to Marty Lavin, Danny Ghorbani was the first to bring it to our Industry’s attention.  We speak of Executive Order (EO) #13563, similar to President Clinton’s issued in 1993.

MHMSM.com posted EO #13563 months ago, that requires an examination of regulatory impact and its benefits.

MHARR is right.  HUD’s budget has grown, while our industry shipments have shrunk.  What’s up with that fact?

What the president – at least on paper –  has done is give us EO#13563 which could hold HUD and other regulators accountable.  Now will our national associations use that to our Industry’s benefit?

The Fall Congressional hearing on Manufactured Housing

Ooops.

Who do we have in DC “helping us” in the planned fall Congressional hearings on our Industry?  Congressman Barney Frank.  What’s up with that?

Let’s see.  Barney helped give us the SAFE Act.  Barney also gave us part of the name of the bill that in his: Dodd-Frank.

So do you feel safer or dodd-franked?

With friends like Barney, does our industry need any federal enemies?

Who is watching how our industry PAC money is spent?  Is this the type of anti-business candidate we need to support?

Where is that change we can believe in?  Or did I drop that change the last time I filed my quarterlies?

One of the best meeting planners around, but…

I asked Tony Kovach why George Allen’s Roundtable was not on the MHMSM.com calendar.  “George isn’t an association, and he opted not to pay for an ad.”

Maybe there is considerable momentum from last year’s event that MHMSM.com did promote.  I noticed that Allen is reporting more state association executives coming to the Roundtable this year.  State execs are often ‘comped’ for coming to an event.  George is one of the best self-promoters the Industry has seen in the past 2 decades.  I’d want state execs helping me promote an event of mine too.  Nothing wrong with it, a common practice.

In the manufactured home communities world, Allen’s Roundtables are unmatched.  Allen gets some fine speakers and topics in.  They are informative and enjoyable.

However, I can’t always agree with George Allen’s commentary, live or in his columns here or in his own publications.  Let’s parse some of his recent ones for a few moments.

I understand and agree with George that MHI doesn’t seem to have a plan for our Industry’s recovery.  What’s up with that fact?  I can see why the natives are restless in the NCC, even with Lisa B getting appointed.

George is spot on that MHI is failing to do half of what an association is called to do – protect and promote.

  • Where is the Industry promotion?
  • How has MHI worked to reverse the Industry’s downward new home shipment trend?  Marty was spot on regarding that topic, in his recent column.

But George’s bashing of Danny and MHARR misses the mark.  Why?

Because MHARR is an association for independent Manufacturers. MHARR don’t get paid to represent communities or lenders or suppliers.  MHARR doesn’t represent retailers,  which if you ask retailers like Doug Gorman or Dick Moore, MHI doesn’t seem to do such a hot job for them either.

George, the point is that MHARR can’t be faulted for focusing on what its members pay MHARR to do, namely, work on regulatory issues.  So George, if you want to fault Danny, fault him for something that group is paid to do.  At least MHARR has stated publicly they support the ‘post production’ sector (MHARR code words for MHI) in their efforts to modify Dodd-Frank, SAFE, etc.  I’ve not seen any similar effort from MHI back towards MHARR.  If it exists, it is behind the scenes.

I also agree with Marty Lavin that we better watch more what people say than what people do.  We better watch results, because words alone can be cheap.

Or words can costly, depending on how you look at it.

Industry Marketing and Image Campaign

Speaking of MHI and the Industry image campaign…

…I’ve seen the plan Tony, IMHA’s Mark Bowersox and others have put together.  In a word, brilliant.

In my mind, they need to consider a different name, but for now they are calling it the Manufactured Housing Alliance and Phoenix Plan.  Their plan navigates the key political issues that our industry has faced that has kept us from moving ahead.

We keep reading from MHI the statistics about our dropping new home shipments.   This gets back to the dual role that an association is supposed to have, protect and promote.

Where is MHI on this MH Alliance/Phoenix Plan effort to turn around our image, marketing and sales results?

Silent.

By contrast. I see John Bostick’s name on the page in favor of the MH Alliance/Phoenix Plan.  That makes me want to order some Sunshine Homes and get others to do the same!

Good for MHARR’s Chairman, who did not endorse it on MHARR’s behalf, but Mr. Bostick has obviously taken the time and had the guts to publicly say, hey, this can work.

Which leads to the questions:

> Where are the MHARR members or Danny on this plan?

> Where is MHI on this plan?

Marty Lavin on Danny Ghorbani

I’m the first to agree with Marty that Danny needs to polish up those lobbying skills.  In fact, let me take Marty’s points a step farther.  As I personally see it, and others may disagree, Danny has three options:

  1. change your ways, permanently and rapidly, to become more effective at what you do for MHARR,
  2. retire and consult for MHARR as needed;
  3. or just retire.

Danny, retire? What would happen to MHARR without Danny?  What’s up with that idea?  Can you even say MHARR without saying Danny G’s name?

Yes, you can.

Attorney and MHARR VP Mark Weiss is a good man.  Mark knows the law, can be reasoned with and Danny has prepared him to take the helm at MHARR, when the time comes that Danny decides to retire or when MHARR members make that decision.

For example, MHARR could bring in a new associate, give Danny a nice gold watch, and a one year transitional consulting agreement.  The independent factories that support MHARR can save money.  As or more important, they likely can get more done and advance their cause in DC with HUD, Congress and other regulators.

The timing is right for a change at MHARR.  Danny, don’t take it the wrong way, you are a smart guy and know the HUD Code as well as anyone in the manufacturing side of the Industry.  But in my personal opinion, it is time to change your ways for the better or you better retire.

The best suits and fine meetings

Danny has some of the best suits in DC that our Industry can brag about.  Danny and MHARR are spot on with some key issues.  But you can be right, and still do things in a way that turns people off.

But give the man his props, Danny is right about MHI meeting,

after meeting,

after meeting and

…where is the MHI plan?

But then, Danny – if you stay – you and MHARR should then walk the walk and have an action plan of your own. Not a some day, or five year plan, a let’s get it done now plan.

Perhaps John Bostick’s public move supporting the MH Alliance/Phoenix Plan will inspire others of stature to make their own public statements or just help launch the program.

But at some point, we need to get past meetings, and get to doing.  46,000 shipments.  We are now down about 88% from our post HUD-Code high in 1998.  How much lower can we go and still have an Industry?

  • We can’t fill empty home sites with only used product.
  • We need new homes bought from factories and sold to consumers.
  • We need retailers and community operators who attract customers with good credit, and then close them and turn them into happy homeowners who will tell their friends and once again let our Industry grow.

The Numbers on MAP

I like abbreviations. Let’s call this plan of Mark’s and Tony’s MAP for short, because this MH Alliance Phoenix can be our road MAP to the future. Maybe we can get Tony and Mark to come up with a better name.  But in the mean time, MAP it is for me.

I asked Tony to give me a projection on what he thinks MAP can do.  His answer?  First year from the launch date could double shipments without a need for hurricane season (no need for FEMA orders).

The next year could double it again.  That would be roughly 92,000 shipments in year 1. Then 184,000 shipments in year two.

Take a look at the MAP if you haven’t already.  If you have a better plan, why not share it?  But if not, get behind the plan that is out there being discussed.

I’m told that MAP can be up and running in short order.  We can do MAP, with no waiting for federal or state action!

Doing the Math, my Math not Ts

Tony has his math, I have mine.

Let’s say MAP was launched, and then MAP raised shipments back to 75,000 the first year.  Let’s further say, 1/2 of the increase went into communities.

  • That would mean 14,500 spaces filled.  At say $275 average a month per site, that would mean $47,850,000 more to MHCs a year.  Plus the profits off the home sales.
  • 29,000 additional new shipments would mean 29,000 new jobs.
  • It would mean security for those whose jobs or businesses are at risk due to declining shipments.How many MH plants would stay open?
  • At even a low $50,000 average per home, that 1.45 billion in new sales.  Think about the boost in revenue to retailers and developers.

Would you give $75 per location to boost sales $1.45 Billion and create about $48 million in new communities revenues?

If not, please go back to 5th grade math.  To me, this spells a good deal.

Let me stress, these are my numbers, not T’s or Mark’s.  But it tells me why they and others are working to see this plan happen.

Chattel Lenders

I’m not without experience in dealing with personal property lending.  While he wasn’t talking about just lending, I agree with Chad Carr’s recently published statement about MAP.  The MH Alliance/Phoenix Plan is the only plan I’ve seen that gets to the heart of fixing chattel lending for our Industry.  MAP provides solutions for image, lobbying and other practical issues too. It dares to be bold, without trying to step on any industry group’s toes.

If your chattel lender has not yet seen this, she or he better do so!  This can help us cut our repos losses dramatically.

It will help our customers – manufactured home owners – dramatically too.  That will in turn attract more customers, and more credit worthy ones.

Manufactured housing lenders need to see our losses cut.  Because that panel of lenders at the MHI Congress last April were correct.  A repo can cost 50% (or more) of the loan balance.   There are so many dark clouds that hang over personal property lending for manufactured housing right now, we have to have solutions if our Industry will ever advance.

In fact, our survival depends on it.

I asked Tony specifically about people who have and have not seen MAP.  T won’t comment about those who haven’t shared a public statement. I can respect that, but it does leave us guessing.

So someone needs to ask Marty Lavin or Dick Ernst where they are on this.  Have they seen it?  What is there take?  It is obvious that Ken Rishel has come out for it, big time, in his own newsletter and on MHMSM.com too.

Come to think of it, where is George Allen’s name on this subject?  Didn’t he say a few months ago, we needed an image campaign?  What’s up with that?

We could go through a list of industry leaders and say, what about you?  Where are you on this MAP subject?

If you are for it, why not say so publicly? If you oppose it, why and then propose your own alternative!  Mark, Tony and those working on this want to see consensus. I appreciate that, but I’d add that we can’t afford to debate stuff forever.  We need to move ahead, and pronto.

If we do not start advancing, more factories, more retailers and more communities will fail.  It is simply 5th grade math.

State and Communities Association leaders

Given that a pair of state association leaders have already publicly stated support for the MH Alliance and Phoenix plan, it is reasonable to think others have seen it too.  We need to watch and encourage this plan at the state level.

Because let’s be honest, the states are where it is at.  All politics are local, and your business happens at the state and local level.

Last year, we saw some state execs who took a leadership role to get things happening at the federal level.  We need to see that again, and we need to see that on MAP or their best alternative to it.

A pimple on an elephant’s bottom

We’ve heard this expression at meetings and coffee tables.  I admit it sadly fits the influence our Industry has politically in DC today.  We need to be working tea parties to get the party of jobs, business and growth moving ahead. We need to hold the feet of those who say they will change DC for the better to the fire, and get the gold of jobs and rising housing back to work building the U.S.A.

We have lost our nation’s AAA credit rating.  Debt piles up, what do we have to show for it?  Where are the jobs?  The lending?  The recovery?  What did we bail out anyway?  Who benefited from all that taxpayer funded largess?

We saw some amazing upsets at the midterms, and I think we can see more if we plan now for the best candidates and then mobilize for the general elections.

It is frankly another good reason to learn and get behind the MAP.  We will increase our influence at the state house and in Washington when our consumers are visibly supporting us in sizable numbers.

Let’s work and earn the support of our communities’ residents and home owners/customers!  Then we should make sure we continue to deserve it.  Without happy customers, we are as doomed as if HUD bureaucrats or others would just shut us down.

TANSTAFL

If I boiled this down, it would be this.  We can’t have something for nothing.  TANSTAFL = There is no such thing as a free lunch. Someone always pays.

We better work for truly positive change, or we will be left with pocket change.

We better look at and support a plan that can move us ahead.  I vote for the MH Alliance/Phoenix Plan.  Or we will suffer the fate of the buggy whip makers.

I shop at WalMart no more than I have to, because I believe in supporting the smaller and more independent business women and men out there.  They are more like me.  They want to serve me, and I in turn want to support them.

We better support the HUD Code builders, and they in turn, better support us too.

Talking and Doing.

Before we look at any other emperor who also lacks clothes, let’s close for now. Talk is fine, but let’s follow talk with do.

I want to thank those of you who have written.  Please do not think me rude, but for now…

…I hope you understand that some things need to be said that have gone unsaid too long.

More next time.##

post submitted by
Michael Barnabas

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A stunning tip by and about a manufactured housing industry chattel lender

August 21st, 2011 No comments

It sounds like Triad Financial Services is making its biggest single-day rate cut in that company’s 50-year history. A reduction of .75% for all categories of loan products for MH’s in parks to take effect immediately, according to a TFS insider. Rate sheets will be out soon reflecting this new change.

This news came out barely two weeks after our industry’s other lender, CU Factory Built, rolled out its new “step-up” loan with very low rates starting at 4.5%.

This is a typical reaction among our MH chattel lenders who are competing for top-tier borrowers (which means borrowers with 700+ credit scores). Without having seen rate sheets, it cannot yet be confirmed if this rate reduction from Triad will affect all tiers of their loan products. However, the source for this story did indicate that the .75% reduction will be “across the board”.

We now have very attractive rates to offer to manufactured home buyers moving into parks. Four years ago, the “floor rate” with our biggest lender was at 10.5%. We can now potentially offer rates less than half what they used to be.

After years of sour news, this is something that should be told to all buyers of manufactured homes in parks. Check back frequently for the latest in this “rate war”.

####

Submitted by
Dave Shanklin
NMLS # 314463

 

Why I Belong

March 9th, 2011 No comments

As far back as 1830, the French statesman and author Alexis de Tocqueville observed in Democracy in America that … Americans of all ages, all stations of life, and all dispositions are forever forming associations.  There are not only commercial and industrial associations in which all take part, but others of a thousand different types ­religious, moral, serious, futile, very general and very limited, immensely large and very minute. And you know, he was right then and remains so today.  How many folks don’t belong to one or more social, religious or business groups?  Very very few.  But the issue here is, how many of you are not maximizing the profitability of your business because you don’t belong to a state, provincial or national manufactured housing trade association or institute?

 

The has identified 22 features that attract businessmen and women to join various assemblies of like-minded individuals and firms.  And the nearly two dozen features have been grouped into four areas of emphasis: activities, information, publications, and benefits. The following paragraphs take a closer look at ten of these feature areas (i.e. reasons) that are particularly germane to manufactured housing industry aficionados.

 

1.      To support and advance a personal, business and other common and important interest to the individual or business involved.  For example, manufactured housing, finance, real estate investment or management, OEM suppliers (i.e. original equipment manufacturers), and on and on.  The purpose to all this?  To capitalize on the very real concept that there is greater strength in numbers of like-minded folk than always going it alone.

2.      To meet, network and share ideas, frustrations and lessons learned, with peers who have similar personal and professional interests.  A good example of this is the periodic meetings we attend on local (i.e. chapter), state (i.e. convention or annual meeting) and national levels to do just that.

3.      To acquire information and access resources key to one’s business survival, even prosperity.  Venues for these opportunities?  Regularly scheduled meetings, trade and professional publications subscription, trade show attendance, even recreational activities like golf outings.  Furthermore, unique and helpful resources are oft available from association staff contacts and their experience, familiarity with research results, etc.

4.      To develop new business through and with people met at association events and activities.  When I started my manufactured housing-related business two decades ago, visiting local manufactured housing association chapter meetings was essential in developing contacts and future business relationships throughout the locale in which I was working.  And now, twenty years later, the pattern repeats itself on a national and international level relative to the very same reasons.

5.      To increase and update one’s skills and knowledge base.  How?  By attending association-sponsored seminars, training programs and other related activities.  Frankly, there are no other opportunities to obtain the specialized knowledge we often need in manufactured housing than to be intimately involved with our state, provincial and national trade associations and institutes.

6.      To keep abreast with changes to industry rules, regulations, statutes and standards.  For that matter, association involvement is oft the only way one has to input the process to begin with, to express one’s support of or displeasure with pending legislation, rules changes, etc.  For that matter, sharing a practical Code of Business Ethics with one’s peers is an important feature of this particular reason for joining.

7.      To learn of and access latest worthwhile business products and services.  Vendors often contact trade associations first to ‘test the waters’ relative to market (i.e.  association member) acceptance.  This is an especially common phenomenon at our regional MH trade shows.

8.      To interface with professional association staff for answers to strategic business questions -and learn where to go for further information.  This could well include access to the association’s attorney for legal opinion and initial guidance in sensitive business matters.

9.       To increase clout in local, regional and national political and regulatory arenas.  Politics is obviously a fact of business as well as personal life.  Why not enhance your opinions in this arena by uniting with trade associations that share your concerns?

10.  To take advantage of group purchasing and/or member discounts for certain products and services.  There’s a very wide range of possibilities here: printing, advertising, travel discounts, group health and liability insurance, banking services, long distance telephone services, association -sponsored retirement plans, etc.

Convinced yet to join?  I surely hope so.  Here’s what Teddy Roosevelt had to say on the subject: ‘Every man owes a part of his time and money to the business or industry in which he is engaged.  No man has a moral right to withhold his support from an organization that is striving to improve conditions within his sphere.’  So won’t you join me?  As a matter of principle, I maintain trade association memberships in every state or province in which I have ongoing business interests, plus the national association that lobbies in my behalf at that level.