COMMON SENSE ALERT: DO YOU THINK TWO YEARS AND $20,000 IS MAYBE OVERKILL ON A $1,000 HOME?

Only in bureaucratic America can it make sense to delay a development for two years and spend $20,000 per home for four holdouts in a mobile home park. The homes in the photo appear to be 1980s models in poor condition and probably worth $1,000 each. Unbelievable.

After about nine months of back and forth, a West Kelowna mobile home park has officially been rezoned to allow for industrial uses. After being deferred twice this year, West Kelowna councillors were satisfied that four remaining residents of Shady Acres Mobile Home Park would be given adequate notice to move out and access to compensation from the developer, Kerr Properties. Brent Magnan, director of development approvals, said that once the zoning bylaw amendment is adopted, that will trigger the 12 month notice period for tenants to vacate as well as the $20,000 compensation for their homes.

I’m sure the poor developer regrets getting involved with a city this out of touch with reality.

COMMON SENSE ALERT: NOBODY BUYS A MOBILE HOME BECAUSE THEY THINK THEY CAN MOVE IT.

All that is great, but the fundamental flaw of manufactured housing remains. Owners of these units typically don’t own the land under them; they rent space in trailer parks. And mobile homes, despite their name, are hardly mobile. Relocating one can cost $10,000 — more than most of their residents can afford.

People buy mobile homes because of their one big strength: THEY’RE INCREDIBLY INEXPENSIVE. Nobody, in real life, ever has the desire to move a mobile home. It has always – and will always – make much more sense to sell it where it sits. Let’s just model that out for a minute for those who are truly common sense challenged. If you buy an old mobile home for $5,000 already set up in a mobile home park in Kansas and then get a new job in Oklahoma, you could move the $5,000 home at a cost of $10,000 (net loss of $5,000) or just sell it to somebody else – exactly where it sits – for $5,000 (so you get all your money back) and then buy another one for $5,000 in Oklahoma. It’s not rocket science. These articles attempt to make you feel that being deprived of your ability to move your housing choice is what makes it a bad buy. The last time I checked you could not move a single-family home or condo either. Give me a break.

COMMON SENSE ALERT: THE RENT GOES UP JUST AS FAST WHEN THE RESIDENTS OWN IT – OR FASTER.

We once sold a mobile home park in Austin to the tenants. Years after the sale calls still came in from the local media wanting to know why we were shamelessly gouging the rents. I explained to them that we had sold the park years earlier and the residents were simply learning the harsh realities of ever-increasing utility costs, insurance, property taxes and all the real-life things that park owners must pay.

All that really happens when a park sells to the residents is that the debt becomes dependent on non-profits that have to personally guarantee it – typically on short balloons – and when they no longer want to stick their necks out it goes back on the market for a normal landlord to purchase. Has a single resident-owned deal ever made it to full 25-year maturity of the mortgage?

COMMON SENSE ALERT: WITH MORE REGULATION COMES HIGHER PRICES WHICH BENEFITS NOBODY.

People buy mobile homes simply because they are inexpensive. When HUD adds on more regulations it simply makes the price higher, while providing nothing of real value to the buyer. Nobody goes around the mobile home park trying to outdo the neighbor by saying “my home saves $4 per year on my energy bill due to my unique window design” but instead says “I sure am glad I bought my mobile home before HUD raised the prices by $15,000 with those new regulations”. I know the nation has gone nuts for ecology and virtue-signaling but the reason you buy a mobile home is not with a concern about energy efficiency. Let rich people worry about all this nonsense and don’t punish those on small budgets with unnecessary add-ons.

COMMON SENSE ALERT: NOBODY WANTS A $2 MILLION MOBILE HOME. BETTER KEEP DROPPING THAT PRICE.

Sarah Paulson brings her Malibu mobile home down from $2 million to $1.8 million

I guess she has friends in the media who keep hyping this up like it’s a great buy or something – it’s been floating around every week for like a month. Give it up.

The group of investors who bought four neglected Spartanburg mobile home parks in July plans to fix up the units while also raising rent. “We're not looking to come in and be the highest rent in the area,” said Tim Woodbridge, one of the investors who made the purchase. “We're looking to increase enough so we can put enough money back into the parks. If you're not making money, you're not putting the money back into the parks, into the homes, and all of a sudden it just cascades into a bad situation.”

I commend the new owners on their narrative to the media, which is that you have to charge higher rent to offer a good, safe product.

And then, of course, the writer can’t help themselves to add this worn-out quote from a resident:

"If they’re doing an increase, they’re gonna put a lot of people out of a place to live".

You can use that same quote on literally every good and service in the U.S. right now, which are up a collective 20%+ under the Biden administration. It’s a meaningless statement. I wrote an article recently in which I highlighted that – under the government’s own budget-setting on-line help site for Americans – it shows that housing is not the #1 cost, but instead ranks behind healthcare, childcare, taxes and even transportation costs. When you get those four solved then you might start complaining about mobile home park rents going up! Give me a break.

It’s really hard to lose money financing mobile homes in mobile home parks that are “backstopped” by the park owners (the model that Buffett created) and incredibly easy to lose money on financing mobile homes without the park owner being involved in “backstopping” them (just ask any mobile home lender on their results from the year 2000 “Great Chattel Crisis”). Once again, park owners get zero credit for this invaluable service they provide their residents. Does that seem unfair? It does to me.

Then, one of her neighbors reached out to Dan Rosensweig at Habitat for Humanity." A woman from the mobile home park came to our office in a panic," he told Radio IQ. "She showed us a note that’s been distributed to all of the residents at Carlton that said the mobile home park is being sold. It was basically a 60-day notice." Working with the Piedmont Housing Alliance, the Legal Aid Justice Center, and park residents, he offered to buy the place with $7.25 million dollars from the city. Over the next three years, Habitat will help residents plan a new community with plenty of affordable housing. No one will be forced to leave, and the group says it won’t raise rent more than $15 a month.

Yes, this is the same story – regurgitated for weeks now -- in which Habitat for Humanity pretends to be the savior of these poor residents who have absolutely no idea what is about to happen. It’s like watching a war movie where the soldiers are walking into an ambush while admiring how nice the weather is. Just look at the wording “… will help residents plan a new community with affordable housing …”. That means the trailer park is going to be torn down and put back as an apartment complex or something other than a mobile home park, in all likelihood. That’s apparently what Habitat has done in the past, according to a park resident in an earlier article. Sure sounds that way to me.

Located in Malibu, CA, the park, known as Paradise Cove Mobile Home Park, has an illustrious history. In addition to Paulson, the trailer park also counts the likes of Stevie Nicks, Matthew McConaughey, Pamela Anderson, and Minnie Driver among its current and former residents.

Before I ever got into the mobile home park business, I owned billboards including a company I bought during the Los Angeles economy crash at the time of the Rodney King riots and the Northridge earthquake. Back then it was well-known that those mobile home parks were the home to stars on the way up or the way down in their careers. There’s certainly nothing wrong with that role, but to pretend that a 1960s trailer is a “jewel box” is as absurd as pretending that a 1980 Yugo is a “classic high-performance automobile”. Nobody is going to buy that outside of Los Angeles.

Not to dispense advice – and with the understanding that I am not an attorney and never hope to be one – but here’s what a well-known municipal attorney once told me the attack plan was on cases like this: sue any council member or official who acts out of accordance with the law, in a personal capacity. When they realize that they have personal accountability for their actions – including potentially having to personally pay their own legal defense – they will typically change their vote. I don’t know the details of this case, but that’s an angle that should probably at least be discussed by the owner with his attorney if he feels that this group refused to give him the permit that the ordinance demands he should receive. Most bureaucrats and volunteers in these committees have no idea of the litigation liability dangers they face when they go “rogue” from what the letter of the law states. And, once informed, they may have an immediate attitude adjustment.

With rising property values in California, there is a growing concern that developers will buy out entire mobile home parks and displace residents.

No joke. Mobile home parks represent perhaps the most attractive re-development parcels in every market in the U.S. Not only do they have the right size (2 to 10 acres) for virtually every pad user, but they also typically have great street frontage, access to municipal water and sewer, and the city will grant any zoning or variance required to get the “trailer park” torn down. I have long said that eventually somebody would figure this out and build a business model around simply buying parks for the development potential. They’ve already figured this out in California. That’s why the national conversation on mobile home park lot rents needs to be “how high do they need to go to keep mobile home parks from being torn down?”.

If you go to the website of ROC – who has been, to my knowledge, the most prolific promoter of “resident owned communities” – you will see that virtually all of their properties have been in New Hampshire. You will also see that there are very, very, very few properties that have ever been successfully made into tenant ownership. We’ve sold several properties to the residents – so we are no stranger to the concept – but I wonder if U.S. politicians are aware of how incredibly few of these transactions have ever happened. The bureaucrats spend so much time talking about this concept, and even passing laws regarding it, without probably realizing that they actually go to completion at an incredibly low statistical level. It’s like spending time legislating new laws to protect polar bears that are hit by lighting and then hit by a meteorite.

"It's really disappointing that banks are not willing to see how stable the market is for manufactured homes in a land use community," said Dolan.

No, what’s really disappointing is that nobody appreciates the fact that probably 90% of every mobile home loan in a mobile home park is “backstopped” by the park owner in order to get the customer financed. Under that arrangement, if the customer defaults, the park owner has to abate rent, effectively take over payments, renovate the home, run the ads, and get it sold. The media gives 0% attention to this fact. Once again, without mobile home park owners the U.S. supply of affordable housing would be greatly reduced – yet we get zero thanks for that fact!

Jon Stratton has called the Southside community home for 21 years. “Southside’s been dying for a long time now. It’s been happening probably over the last 12, 15 years that I’ve noticed,” Stratton said. “And I feel like the whole economy on this side needs to be rejuvenated.”

Finally, a truthful quote from a “normal” resident – and not some nut case who would choose a bucket over a toilet if it saves $3. This is what 99.9% of park residents really think about park improvements and higher rents – they are 100% on-board with it. It’s about time that the media starts interviewing the nice people with nice homes, yards and cars and not the .01% of park residents who could care less about their quality of life as long as it saves 50 cents.

NIMBYism certainly plays a role, but what is it about modern, well-kept developments like Kathleen Manor and Olde Stone Village that puts off prospective neighbors? We find nothing objectionable about them at all.

Whoever wrote this obviously lives in an apartment as no homeowner on earth would welcome a mobile home park being built in their neighborhood. If this writer did own a stick-built home, and there was suddenly a zoning request to build a “trailer park” next door, you know they’d be the first one marching on city hall with a flaming torch. Give me a break.

Baez says the real problems remain: parking policies she claims are aggressive and discriminate against the park's lower-income families – policies that she said eliminated free street parking, charged monthly fees for extra parking spaces, and charged additional fees for visitor parking.

Virtually every mobile home park in the U.S. was built for a maximum of two car parking per mobile home. It is not the park owner’s fault that residents have more than two cars. Despite this, most park owners try to accommodate this issue with overflow parking and dicussing if those with one car would allow others to park on their spaces. But the contention that mobile home park owners are required to provide unlimited parking is pure insanity. I dare you to find an apartment or condominium in the U.S. that allows you to park as many cars as you want there.

Now this is an interesting article. A rent control board member is accused of deliberately keeping the mobile home park rent increase low in order to try to buy the park themselves at a reduced price. I hope the park owner wins and that puts the fear of God into every other rent control board member out there that they may actually have personal liability from their decisions. It reminds me of the zoning case in Dallas in the 1980s in which a real estate speculator went to the Dallas City Council to renovate an abandoned K-Mart into a movie theater. The neighbors hated the idea and got to the board members and convinced them to vote against it. The property owner reminded the board members that the property already had the zoning for a movie theater and they had no option other than to approve the plans. Nevertheless, the board voted it down. So the developer filed a personal lawsuit on each and every member of the board that voted “no” and within two days they had an emergency meeting and approved the theater.

Amazing how a little personal accountability takes the fun out of things, right?

The land on which the mobile home park sits, with some ancillary properties, was purchased by Joy and Eddie Hanks in 2020 for $600,000, with plans to redevelop the park into “Digs on the River,” a 23-acre mixed use area with plans for apartments, a restaurant and commercial space.

What part of the residents’ “fate” is uncertain here? They have been formally given notice to leave and the owners of the property seem to be following all the correct steps.

What’s really interesting is the price paid for the property, which equates to only around $15,000 per space. Once again, this park could maybe have been saved with higher lot rents, as most well-run parks today are worth around $50,000 a space and that would have made the redevelopment plan less appealing.

Once again, as always, LOW LOT RENTS = REDEVELOPMENT.

So what private equity found it could do was coming and raise lot rent — sometimes by as much as 60% and 70%. Which, you know, may not sound like much if you're going, "Oh, it went from $320 to $405." But think about if your mortgage was increased by 40%, 60% ... that is a huge impact on people…

No, that’s not correct at all. Raising rents from $320 to $405 is an increase of 27% NOT 60%. If you raise the lot rent from $320 to $405 that’s a $85 increase. The average mortgage payment in the U.S. is $2,715 per month (per Google). If you raised that by 27% that’s a monthly increase of $733 per month. THERE’S NO WAY YOU CAN COMPARE AN INCREASE OF $85 PER MONTH TO AN INCREASE OF $733 PER MONTH – that’s nearly a 10-for1 difference! Using this logic, McDonald’s raising the Dollar Menu price of the McChicken from $1 to $1.60 – a 60% increase – represents a much greater offense and financial burden than either of the above.

When you talk about price increases, the percentage means nothing and the actual amount means everything. If milk goes up 50% and a car goes up 5%, guess which one is a bigger problem for the average U.S. household?

How math challenged is America, anyway?

Residents of the community said the park's owner got permission from the rent control board in Ludlow to raise their lot fees by 150%. They're hoping to have that decision reversed in court.

So let me get this straight. The park is subject to rent control. The rent control board approved the increase. So how is this even a story? Do the “free rent movement” folks now want a rent control supreme court to watch over the rent control board – just because they don’t like the outcome?

These residents are sending a definite message to the park owner: “time to redevelop into something else”. If they keep this up they won’t have a mobile home park to complain about.

"Currently there are 10 counties that have a rent stabilization ordinance that specifically addresses mobile home parks in the unincorporated areas of their counties,” Nolen said, "We're not talking about section 8, we're not talking about homeless situations but if we don't have this conversation that is exactly what we're talking about."

Oh, I get it, the park owner is responsible for the tenants’ lives in perpetuity and must be held accountable if the tenants fall into Section 8 or homeless status because of their own failure to manage their finances and live in a modern world.

Only in California.

Based on this writer’s arguments, every single product and service in America – which have risen a collective 20% under the Biden administration – is a part of the “economic eviction crisis”. If gas costs $4 a gallon and eggs cost $5 a dozen, that takes away money that could go against higher rents, right?

But the bigger issue – and one that nobody wants to talk about – is the simple fact that seniors may need to move to more inexpensive areas of America in retirement since they no longer need to have access to employment. These type of articles always give the narrative of the expensive urban market with lot rents approaching $1,000 per month as opposed to the rural mobile home parks in states like Arkansas, that rent for $150 per month. And that’s not fair or constructive.

The bottom line is that most seniors, as part of their downsizing in housing and costs, need to move to cheaper states and more rural areas. If they don’t want to do that, then that’s their choice. But the option is always there and if they refuse to embrace it then they shouldn’t complain.

Residents say new management for the land their homes are on arrived in March and have since been making changes to property rules. People with cars have been told they have to pay to have them parked in the community now, and some of them have lost their dogs because they’re not allowed on the property anymore.

One look at the homes in the photo and any idiot can tell why certain residents are being asked to leave. The new owner is obviously trying to bring this downtrodden park back to life and, with progress, some people get displaced.

Park owners can’t win with writers like this. If the new owner left the dilapidated homes alone, they would be tagged as slumlords in these type of articles, and if they get them torn down, they’re identified as being cruel.

You can’t please everyone, so you have to please yourself, your good residents, your bank, your city inspectors and the surrounding community. It’s that simple.

Wow, the free legal aid attorney got the residents a few weeks more time. Big deal. The fact is simply that the park is being redeveloped apparently into apartments. It’s the same old adage week after week: LOW LOT RENTS = REDEVELOPMENT. How high would the lot rents have needed to be to make a mobile home park in this location more valuable than an apartment complex? Not sure. But that’s the key issue people need to explore.

“We were looking for a place that was almost a presence within this community. And we have members that live within this community, and through them and being around, we noticed ‘hey, there’s a building that’s not being used,” said Pastor Preston Pratt.

We are also big believers in converting every inch of common area in every mobile home park into an amenity for residents. Abandoned clubhouses are low-hanging fruit and, with the addition of working heat and air-conditioning, sturdy carpet, fresh paint, and a vision for what the residents need, we have converted such structures into party areas, game rooms – even libraries.

Getting help from non-profits to augment the amenities is as simple as asking. We converted an old laundry building into a library and the local library donated all of the shelves and books – simply because we called and asked if they could help. We even had a Lions Club donate a giant playground.

Want to enhance your amenities for residents? Call and ask other non-profits.