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Posts Tagged ‘new homes’

An analysis of The Atlantic’s report on Manufactured Housing, CFPB and MH Financing

October 27th, 2014 No comments

One thing that strikes me about the article in “The Atlantic” is that there was a great deal of good press for manufactured housing. It touted the energy efficiency, the lack of waste in the factory building process and the ability for more modest income families to become home owners. All great points.

On the negative side, it seems to focus on what truly plagues this industry and that is undeniably, the difficulty in financing manufactured homes. Unfortunately, the industry is caught between a rock and a hard place. Chattel loans are under the exact same strict CFPB regulations that apply to mortgages, but there are no lenders or secondary markets that consider them the same as a mortgage.

If CFPB is going to continue this interpretation, they should also mandate that any lender allowing conventional mortgages cannot simply deny a manufactured home loan.

Many manufactured home consumers are elderly, disabled and families with children. The refusal of lenders to loan on manufactured homes in a land-lease community seems to me to cause a disparate impact on at least three protected classes; age, disability and family status. The industry is not making this argument and I truly believe this is a talking point we should make for our cause.

In addition, some non-profits that are pro-manufactured housing are advocating for manufactured homes in land lease communities to be considered real property. If this would bring lenders to the table, I would say it might be worth looking into. Unfortunately, this is not a real solution and in fact can cause some serious problems. Some states already have this type of arrangement and they have no more lending than any other states.

Let’s keep the conversation going and try some new arguments and strategy to get this industry motivated to the point where we see retail sales centers popping up in high visibility locations.

Let’s try to get communities filled with NEW homes that will revitalize the community and provide that affordable housing the entire industry is so proud of. It is time to move forward and that will take the voice of the entire industry speaking to Federal, State and Local officials that are motivated to help. ##

Amy-Bliss-CAE-wisconsin-housing-allianceAmy Bliss, CAE
WI Housing Alliance/Tomorrow’sHome Foundation
258 Corporate Drive, Suite 200C
Madison, WI 53714
608.255.3131

(Editor's Note: Amy Bliss' response is to the article inThe Atlantic entitled, The Case for Trailer Parks, linked here.

As with all OpEds, the views expressed may or may not represent those of MHProNews or our sponsors. We welcome other perspectives on this or other topics of interest to industry professionals. Please send your letter to the editor or OpEd – with Industry Voices in the subject line – to this link, thank you.)

Why the Continued Conflict?

March 8th, 2014 No comments

One has to ask themselves why this conflict continues? You ask what is the conflict and why do we as an industry need to concern ourselves with this issue? The answers are simple; the conflict is the continued divide between MHARR and MHI. The reason we must concern ourselves is obvious; industry unity will bring us further and faster than continued disunity.

I am not alone in asking this question about the root causes of the conflict.

Recently individuals from both inside the industry and the regulatory sector have written about the approach and tone of the messages sent by the Manufactured Housing Association for Regulatory Reform's (MHARR) President and CEO, Danny Ghorbani.

There is no reason for messages of the nature like the one linked here to continue.

Just this week the industry received some well needed good news that Pamela Beck Danner, JD, was appointed as the new Career Administrator for the HUD Manufactured Housing Program.

Rather than just leaving the message as a congratulatory letter, Danny stated that MHARR will challenge HUD’s change to the law regarding the position to being a career vs. non-career administrator.

Even if HUD has inappropriately changed the law, why send this widely distributed mixed message? Why not just congratulate Pamela and then quietly send HUD an objection that would not be widely distributed?

Continuing this pattern of creating conflict is not beneficial to anyone involved in Manufactured Housing regardless of which area of the industry one is involved in. Are these the types of messages that we want as we work to accomplish our industry goals? I think not.

Just think how much more our industry could accomplish by working together! It is critical that as an industry we focus on the target and develop a cooperative effort to move our goals forward.

Both organizations do not always have to agree; in fact we may agree to disagree. Even in that case, we must show our public unity and spend our collective time working on the core issues.

By not working together some think we weaken our message. By contrast, when we work together we can send a more powerful message to Congress, the Regulators and all others involved that we stand together to accomplish our collective goals.

Clearly MHI is moving the ball forward in this regard, on both the regulatory and legislative fronts. One might ask, if MHI can do it alone, without Danny Ghorbani/MHARR, will MHARR and Danny become politically irrelevant?

I have been in the Manufactured Home Community and Home Sales businesses for over 32 years. During this time I have worked with manufacturers that were members of both MHI and MHARR. In fact, some of the manufactures whom I purchased homes from were only MHARR members. Naturally, I have spent a great deal of time with the principals of these companies along with Danny discussing many issues.

We have developed close personal relationships from working together. From our times together I have learned much about many issues, some which I was not aware of previously, others that could affect my business. There have been issues on which we have not agreed upon, yet we never treated each other rudely or without mutual respect.

That is the type of relationship which both organizations must strive to maintain, especially in today’s difficult times.

Those of us in the business are all very conscientious of whom we choose to work with or purchase products from today. Our decisions are influenced by many factors; company history, price, service, product mix, warranty and personal relationships. I am about to purchase new homes to place in my communities. One consideration that I would be remiss to not consider in my decision making process is which manufacturers support the industry's goals that I support.

In addition, I have very strong reservations on working with a supplier who supports continued conflict and inappropriate messages being distributed by MHARR's CEO. Why would one work with a supplier who is not aligned with our industry's or my personal goals?

This is no different than one deciding to no longer buy homes from a manufacturer who lacks in timely, quality post-sale service and warranty support.

To financially support a manufacturer who through his association dues allows this discord and strife to continue in this small industry is questionable at best. We need to vote with our wallets! Maybe that will get the attention of those who fund the emailed or print messages that slow or harms our industry's message in Washington, DC.?

Maybe that would stop this avoidable and counterproductive multi-decade conflict. ##

rick-rand-great-value-homes-manufactured-home-pro-news-industry-voices-guest-blogRick Rand
Great Value Homes
Milwaukee, WI.

(Editor's Note, Rick stresses he is writing as an industry business professional, and not on behalf of any association. Rick was recently interviewed, see A Cup of Coffee with…Rick Rand., and is also in a video interview shown on the paged link here.)

A Decades Old Quest!

December 5th, 2012 No comments

(Editor's note: a message with a ten year old editorial column came in with an attachment. I asked the sender to write a new introduction, which is the first paragraph below. The rest is a decade old, but could have been written yesterday! Let's not let another 10 years go by and say, “what if?”)

It is not news to any of us in the Manufactured Housing arena that there are serious challenges facing our business from all sides. In survival mode during hard times, it’s easy to forget some of the important  image issues that have constantly plagued us.  How we present ourselves personally; neat and tidy, with a smile on our face, ought to be applied to the way our industry presents itself to the public.  Consider the following:

There has always been a lot of talk within the manufactured housing industry about our image. As a Landscape Architect and planner of manufactured housing communities for more than thirty-five years, image has been an important consideration in the design of communities and the focus of my activities in the industry. It is the source of great frustration to me, that both new and older communities are being designed or presented to the public like the trailer parks of the past.

Row on row of new homes spread out like dominoes on the land, with little apparent thought given to the final appearance of the community and the image it will portray for generations to come. Why is it so? Do developers, engineers, designers and planners feel that our customers don’t deserve better? Is there an assumption that creative planning is too costly? Is enough energy being expended by the national and state industry organizations to promote good design as an important part of our image building strategy? Are we doing enough to educate the planners who review our projects to recognize, encourage and approve projects that are attractive and desirable living environments? I fear that all of the above are true.

Our counterparts in the site built housing business are keenly aware of the benefits of creative planning. The traditional neighborhood development movement, open space conservation planning, planned unit developments, cluster designs, and curvilinear concepts are stock in trade for the better developers. The appearance of their developments from the street, curb appeal and sizzle of their homes is as important a part of their merchandising effort as their floor plans, interior decorating and furnishings. Models are creatively furnished inside and attractively landscaped outside to excite and stimulate the customer. Builder’s displays at development model centers are creatively done with renderings illustrating the final and complete appearance of the home package.

Contrast this to the way the majority of manufactured homes and developments are merchandised. For the most part our homes are pictured by the manufacturers as “plain Jane” boxes devoid of the elements that if added would ultimately make the house an attractive home. These same units are shown to the public at sales centers without any of these important added elements. Is it any wonder our customers feel that their home is complete once it is blocked up on their lot? Community and subdivision developers also miss an opportunity when houses are permitted in developments without the simplest of requirements that would assure curb appeal for the home and the development. Even simple appearance requirements would help to assure growth in the value of the home and the development.

The majority of manufactured homes are designed and built with image emphasis on the long side of the home, this is all well and good when the home is placed long side to the street on wide subdivision and land lease lots. Unfortunately these wide lots result in a significant increase in development cost and a reduction in density. So much for affordability! A few manufacturers are placing emphasis on “developer Series” homes, homes that look good on larger lots and in scattered site settings. A “community series” of homes with emphasis on the appearance of the narrow end of the home would be a great improvement. After all, aren’t most of the homes in communities and subdivisions placed on affordably planned narrow lots resulting in end rather than side views of the home from the street?

Perhaps if our industry were to place more emphasis on the final product, the completed home, we could more rapidly move toward public acceptance of manufactured homes. Many years ago, the Urban Demonstration Project sponsored by MHI proved that with sensitivity to detail and proper presentation, our homes could be a welcomed addition to most neighborhoods. Will we ever profit and learn from these experiences, or continue to “succeed in spite of ourselves” because we provide the least costly available housing. I am certain that the continued growth in of our share of housing in America is dependent on whether we view each new home sold and each new development as an opportunity to improve the image of manufactured housing. I am also certain that continuing to design and develop new “trailer Parks” and sell incomplete homes will perpetuate the industry stereotypes that have helped to keep us from reaching our full potential….What do you think? ##

Don Westphal
Donald C. Westphal, Associates
71 North Livernois Ave.
Rochester Hills, MI 48307
PH: 248-651-5518
Fax: 248-651-0450

What Manufactured Housing Competes Against

August 7th, 2012 5 comments

l;ance-inderman-mhpronewsI think we need to take a serious look at what our industry is competing with in the housing marketplace and the regulation that each of our housing competitors are facing.

We worry way to much about what one of the 3-C's of manufactured home building are doing than we should. As a percentage of new homes sold, we just keep loosing ground.

The site builders are pushing us further and further into the rural abyss. I have a partner that builds homes with me in Lubbock and we are able to build a brick home with porches and 6/12 roof pitches for around $40 a square foot including material and 100% subcontract labor.

I have another friend that builds about 125 new homes a year with annual sales of about $35,000,000 and a little over 10% net bottom line. He does this with 9 employees, no multi-million dollar building, total work in process and finished goods of about $1,500,000. He has no licensing requirements. His company and his salespeople have no continuing education requirements. He does not offer paid vacations to his employees or laborers. He is not faced with massive unemployment taxes if he does not have a house to build tomorrow. Government mandated health insurance does not affect him. Basically he has almost no regulation and very little overhead. He builds a quality product and is very successful.

I drove down the beach between Beaumont and Galveston and pass one RV park after the other with all types of RV's up to buses that cost over a million dollars.

I saw manufactured homes that were at least 12 feet in the air to protect a $40K double wide from flooding. The construction cost to complete these jobs has to be close to exceeding the cost of the home itself. This does not appear to be a very efficient way to supply housing to me. It looks to me that the RV industry is getting a big piece of our pie and the site builders are getting an ever increasing bite as well.

We have to become more efficient at what we do from the factory to the finished product.

I think the factories do a fabulous job building 16×76's, its the most efficient 3 bed 2 bath housing I have ever seen. But by the time we: 

  • market that 16×76 to our customer at retail,
  • deal with all the regulatory requirements to install and complete the home,
  • deal with private finance against government subsidized financing on site built's,
  • escrow over priced insurance and taxes and
  • then deal with the cost of servicing a home in the middle of nowhere,

our monthly payments are as much or more than most people can buy a new starter home including land in a tract home subdivision.

We must do everything in our power to control these costs, including, but not limited to:

  • getting our finance on a level playing field,
  • getting higher deductible lower cost insurance in our market,
  • factories working with the retailers/installers to do everything possible to lower the cost of installs and
  • last but not least keeping the regulators at bay.

I think our industry has a remarkable product that we can build and a great story to tell but all you hear and see is "I don't want a trailer in my back yard."   Most of those yards now include a brick home with an RV in the driveway.

I've said it a 1000 times that if we did not have FHA, FNMA and Freddie Mac that our industry would be producing the most affordable quality housing option on the market. What gives?

Lance Inderman

l;ance-inderman-mhpronews(Editor's note: Lance Inderman is arguably one of the most successful independent retailers of manufactured homes in the country. Champion Homebuilders recently purchased Athens Park Homes, a HUD Code, modular and park model builder that Lance and his associates operated. He was the Chairman for the Texas Manufactured Housing Association in 2010-2011 and remains an active player there. Lance plans to attend the TMHA annual event.)