What will mobile homes look like in the decades ahead? Will anyone still want to live in them? In this week’s Mobile Home Park Mastery podcast series, we’re going to discuss these issues within the general theme of The Future of the Mobile Home Park Product. We’ll talk about futuristic designs from a half-century ago from folks like Frank Lloyd Wright, to new things we’re seeing introduced in today’s models.
Episode 5: The Future Of Mobile Home Parks Transcript
The future. Does that term make you think of Star Trek, The Jetsons, or a single-wide? Yes, there is a future to the mobile home product. We're going to discuss what is that future and what will the impact be of the future of the product we know as the mobile home. First, let's talk for a moment about people who saw the future even 50 years ago. Frank Lloyd Wright. He designed a mobile home called the Usotonian Americana. In fact, it travels the country periodically from museum to museum.
Raymond Lowry, the number one industrial designer in American history, also designed a mobile home about 50 years ago. Sadly, neither of these two great designers' product ever went into production. They did see the future and to them, the future was producing a product that did not look like a conventional home. Now if you've gone to the mobile home shows over the last several years, whether you go to Louisville or Tunica, you've probably noticed that the interiors of mobile homes have become very, very advanced.
When I look back on mobile homes that I walked in 20 years ago straight off the factory floor, they are so pathetic compared to the modern ones, it's scary. How did they get the interior so good? Well, I think a large part of it was Warren Buffett's purchase of Clayton's Homes. Buffett brought with him obviously a lot of capital, a lot of expertise in management, and somehow they were able to attract some of the best designers in the US coming out of single family and multi-family and apply their abilities to the redesign of the standard mobile home interior.
When you go to the mobile home shows and you go to the Clayton booth, you're just blown away with how good things are. You go in some of those homes that are produced today by plants like the Wakarusa plant up in Indiana and you say, "My gosh, this looks just as good as any Class A apartment that I've ever seen." You're exactly correct. In fact, it looks identical to those Class A apartments and it looks very similar to a lot of the single-family new product that people are building.
They've really got the interiors down well. I don't really see much needed as far as the interiors of the mobile home going forward and I'm, frankly, not exactly sure what you could do to improve on the interior. Now there are some things to the interior that, yes, you could do a little better. Typically, that would be in the realm of windows, however, they're trying to work on that. They're trying to come up with windows that are more appealing that don't look just like somebody punched some rectangles in the wall and put a simple, a couple pieces of glass in it.
I know that Clayton has looked to put in some horizontal windows at the top of the ceiling line which are interesting looking. Really all manufacturers are starting to work on new designs to make the windows look more, I don't know, finished: valances, draperies, boxes, things on the windows. Really the windows are one area that, yeah, you could probably do a little better. Other than the windows, when you're on the inside of a mobile home, I think most people today on the new models are simply blown away.
I show photos periodically to people who didn't go to the show, lenders and other folks. They always say, "Oh my gosh, I can't believe how good the interiors are." Then you show them the outside of the homes, they're no longer blown away. I think the future of the MH product is going to be much better exterior design. I think that is the weak spot of the industry. I think if you ask any 10 people, "What could our industry do better as far as the mobile home product?", they're pretty much all going to say it's the exteriors.
Not that the exterior is terrible. The advent of the shingled roof, vinyl-sided home definitely made it look more finished, more professional, more home-like, but the problem is it's very plain Jane. It's very boring. It's not really a turn-on. It does not look like it's come very far, to be quite honest with you. When you look at homes from the 1980s, the late 80s where they first started bringing out those pitched roofs given that they were metal on metal, they still kind of sort of look like the new homes on the exterior.
What can we do? How can we make the exterior seem more modern? More upbeat? More attractive? More desirable? I think what you're going to see is a lot of things coming from the tiny home movement that will ultimately be blended into the mobile home product. What am I talking about? Well, look at your typical tiny home and what do you see that's different or compelling. You'll see it tries to look nothing like a traditional home.
There's no pitched roof, there's no little plain Jane windows and things that you see at the shows with the new standard homes. It gives it a little difference, a little more creativity. How do you do that? How do you take and put the tiny home movement lessons learned onto mobile homes? Well, I think you're already starting to see that. When you go to the shows, typically at the back of the pavilion of whatever manufacturer it is is a tiny home or two. Yes, they do make standard industry created tiny homes.
Some people know these by the name of park model because that's who they were originally designed for. They were designed for the RV industry typically as kind of a hotel, by the night alternative to an RV. However, those little tiny homes yield some pretty big ideas. Those RV owners and the people who buy recreational vehicles are a little pickier about design perhaps than a lot of your mobile home shoppers.
In fact, if you go over and look inside recreational vehicles at your typical RV lot in anywhere America, you'll see that their designs have actually gotten a little more advanced even perhaps than the mobile home park sector. Why is that? Well, their price points are so much higher. A typical motorhome today can run $100,000, $200,000, all the way up to a million or two. You have a much more discriminating customer, somebody who really demands perfection for the price they're going to pay.
Those are the breeding grounds of great design. When you're trying to sell a $1 million dollar motorhome, you better knock it out of the park as far as making something that people really, really want to own, that they're proud to own. That's why I think you're going to see so many new, fresh, and great ideas coming from these very shows you see on HGTV. Tiny Home Nation. All of these tiny home productions are really going to be where all these great ideas come from. Those are going to be the little grain of sand that makes the pearl in the oyster.
I was at the Tunica show and I went in the tiny homes. Those tiny homes are so much cooler and edgy looking than the mobile homes, it's crazy. You look at the two products and you say, "Well, why don't they put some of those ideas into the mobile homes?" I think the problem right now is fear, fear of the unknown. They don't know how people would respond to a product that doesn't look like it has for the last 50 years.
Clayton, under Warren Buffett, built a couple home models people do not know about. One was called the iHome, one was called the eHome. Energy efficient, kind of edgy looking. I really liked the way they looked, but they didn't sell probably because the price point was around $100,000, so it really was outside the box of what the typical mobile home customer would want to pay. But could we take some of those ideas and graph those onto the traditional mobile home as we know it as affordable housing?
Is it possible that we could do that? Could we find a new way to provide a product that's not only cheap, but extremely attractive on the outside? I think we can. I think you're going to see that. When you look at some of these designs, and probably my favorite design I've seen from the tiny home movement was a design in which they used the roof as an additional living space. How cool is that? They have a stairs on the outside of the home with a handrail and you go up the stairs. On the top of the home, you've got this patio.
That's so neat. You know consumers would love that. Buying 1,000 square foot mobile home with 1,000 square foot additional bonus space on top? That's pretty much something. I think those are the kind of things you're going to see. Entirely new ideas, entirely new ways to use space and entirely new looks that say, "Hey, I'm not a mobile home, I am a completely different animal." I think consumers are going to love that concept. I honestly believe you will see that in the years ahead.
For all I know, you'll see it this coming year. I think the Louisville show's in February. For all I know, that's going to pop up at the Louisville show. If you can make the exteriors look as good as the interiors, the future of the product is pretty much limitless. You've got all these neat initiatives going on right now in the government, which we're going to talk about. All the Duty to Serve initiatives and things like that.
There's another group out there that isn't really part of Duty to Serve and that's a little more upscale customer base that could be attracted to the industry if they could just make the homes look a little more exciting for the consumer. You'll find in a lot of mobile home parks in the US, particularly in urban areas where cost of housing is very high, Austin, San Francisco, those kind of markets, you'll see the customer's not what people think of when they think of a mobile home park resident: someone with a higher income, higher educational status. A little more of a picky shopper.
So what are they doing? Well, they love the concept of micro-living, of having a yard and having a sense of community. What's holding them back from living like that? It's probably just the stigma. You see, they don't really want to live in a mobile home, they want to live in something new. They don't want their friends to say, "Oh, you live in a mobile home. Oh, I guess that's okay." They want to be proud. They want to be completely different.
I think that's the future of the product is you're going to start seeing exteriors that are different that shout, "Hey, I'm new, I'm special" and not try and look like a shoebox with some windows cut in it and a slightly pitched roof. I think you're going to be seeing an entirely different product in the years ahead. Here's what's great about that. When you build out that new product, whatever it is, personally, I think it will come from Clayton, but it might come from a different builder, something that's edgy and different that people say, "Wow, look at that."
Kind of like when they brought out the Mustang in 1965 and people said, "Whoa, you can make a car look like that? Holy smokes. I want to buy one of those." They sold a million units in a year. The same thing will happen with mobile homes at some point. People will say, "Gosh, that's really cool." People will start lining up to buy them kind of like the Tesla, only without the electric engine in it. You'll get a better quality of customer. A customer that was never really in the affordable housing arena, but is in the micro-housing arena and loves the basic contact.
Remember that Tony Hsieh, the founder of Zappos, lives in a mobile home park out in Las Vegas. It's called Airstream. The Airstream Park is the name of it. About half the units in Tony's park are Airstream trailers, hence the name. The other half are micro-homes. Tony lives there because he loves the camaraderie of his neighbors. Prior to that with a net worth of $800 million dollars, he had kind of set himself aside from the public living in a high rise there in Downtown Las Vegas.
He felt, apparently, very lonely and he wanted this sense of sharing his existence with other people. He built Airstream Park in order to spend his time bonding and having a sense of community among people who were just like him. Younger, edgier adults all trying to make a difference in society and start companies and do all those things that modern people want to do and of course, not that different from what all of us did 20, 30, 40 years ago. I think to get this done, you've got to have a new product.
I don't think Tony Hsieh would have moved into that mobile home park if he'd simply filled it with regular old shingle-roofed, vinyl-sided mobile homes. It wouldn't have been attractive to him, it wouldn't have been attractive to his customer. If we can just embrace a new product that looks entirely different, we can tap into a market we've never tapped into a long, long time. I say a long, long time because if you look back in the 50s, mobile home parks had a higher demographic profile than stick build housing.
For one brief moment in time, we led the pack. People who lived in mobile home parks had the highest incomes and the highest educational status of any group in America. Don't believe me? Look at it yourself. Look at the facts. Elvis, the King, lived in a mobile home park during the movie 'It Happened at the World's Fair' in 1963 and again in the movie 'Speedway' in 1968. Everybody in the film was driving a sports car as they'd drive around the mobile home park.
I think we can see that again. I think we can get another new realm of invention in the appearance and the outward appearance of these homes. We can attract a new customer base we haven't seen in half a century. Also, obviously, having these better customers will be great for park owners themselves. The higher demographic customer will be able to pay and will want to pay a higher rent. That's good for the owner. They'll also exhibit great pride of ownership. Again, good for the owner.
In fact, I can't give you one negative connotation to having this higher demographic base than we currently have. Now not all parks will attract that, sure, that's a given, but there are a lot of parks out there in more urban areas that will. We own a mobile home park. Not one, we own about 10 over in Urbana, Illinois, where the University of Illinois is located. Our mobile home parks are filled with regular affordable housing folks, but one day, for all I know, some portion of those properties will be filled with students or faculty or people who just like the whole idea of tiny homes and micro-living.
I think to get there, we've got to offer them more of what they want: a product that looks and feels different. I think that's the key to the future of the mobile home park product is it's going to be coming up with something on the exterior side that's different. Again, the interiors, I have no problem with them at all. I think they look fantastic. I just wish we could get the exteriors to look as good, but I know that we will.
I know that the tiny home movement will eventually have an impact on the way we look at these things from a design standpoint. Those designers will be able to come up with some radically great ideas. In fact, I wish they'd start off by looking back at those designs by Frank Lloyd Wright and Raymond Lowry. I thought they were really neat. I think it's kind of cool when you look at them to think what would have been had those gone into production, but yet it's not too late.
Maybe we can bring those really neat designs back. I think that the future of the industry, particularly the mobile home model, is very bullish. I believe if we can get the exteriors looking as good as interiors, it will be an amazing product. "An insanely great product" to quote Steve Jobs. That will lead to new folks looking at buying these that have never thought about our industry ever before. Again, the future of the MH product, it's rosy if we can just get the outsides to look as good as the in. I know that we can.