Mobile Home Park News Briefing

The tenants want to buy their mobile home park to fend off the evil landlord that might buy it. But there’s a big problem:

The homeowner leaders of the newly formed Milner Park Community Cooperative are in active negotiations with the out-of-state investor/owner trying to purchase the Milner Mobile Home Park property. But negotiations currently find the two sides more than $2 million apart.

So the residents are asking strangers to send in $2 million to bridge the gap:

For anyone who might like to help the homeowners purchase the land under their homes, tax-deductible donations can be made through nonprofit Yampa Valley Community Foundation.

Here’s the problem: it’s not gonna happen. Not ever. Not even close.

It might be time for the “Free Rent Movement” folks to acknowledge that their “tenant-owned” fantasy just doesn’t work in real life.

In real estate, cash is king. If you have none, then don’t bother to show up to play. End of story. Standing around with a can on the street corner might score you $10 from strangers, but not $2 million.

FLOWER POWER SCORE: 10

Owners of mobile and manufactured homes in Maryland’s coastal communities and their insurance agents are having difficulty finding insurance coverage as carriers pull away from the market. The problem is squeezing owners who want to sell their mobile or manufactured homes. They can’t sell to buyers who need home insurance to satisfy lenders, so their pool of potential buyers is limited to those able to pay cash. Local officials are worried that this, in turn, is reducing property values.

The flood insurance business has been a scam from the beginning. It takes in around $4 billion a year nationally yet has losses maybe ten times that amount. So the insurance companies are finally pulling out. You can’t blame them. “Free Rent” folks will claim it’s the fault of evil landlords but the truth is that the insurance industry is simply no longer willing to prop up reckless behavior by sponsoring living in areas that tend to go under water on a regular basis.

FLOWER POWER SCORE: 8

Lennon, who owns eight mobile home communities, said that increase was needed because the previous owner was charging too little for too long — the park has only seen two rent hikes over the last five decades, he said. That left the park poorly maintained, he said, with a backlog of costly upgrades needed. Since his purchase, Lennon has paved roads, added fencing and installed new mailboxes, among other improvements.

Look, all of this “Free Rent Movement” nonsense is simply not going to work. If you deny a property owner’s legal right to raise rents to market levels, they’ll simply tear the park down and put something else on the land that is more profitable. Now it looks like the ‘Free Rent” folks have a new plan: let’s just buy up all the mobile home parks in the U.S. and then artificially suppress the rents. Only one problem: to service the debt, they’ll still have to raise the rent just as much. And then, of course, they’ll have to also raise the rent to account for higher prices on water, sewer, electricity, insurance, property tax, etc. By the end of the movie the tenants pay the same rent if they own it then they would with a regular investor owning it.

But it turns out worse. Because the tenants don’t really buy these properties, non-profits do. The non-profit originators go through the exercise to get up-front fees which they pocket. However, the loans are personally guaranteed by a different non-profit (the lender will not accept the tenant’s personal guarantee as they have no assets) on typically a 5-year loan term. When it comes due, the non-profit guarantor can simply lose interest in the renewal and then the property gets sold back to a regular investor. In other words, it’s a racket. And all the residents get out of the deal is lousy management and poor living conditions from the amateur management of their fellow residents. And all for the privilege of being a promo piece for the non-profits before they cut them loose.

For the truth about these “tenant owned” parks, look no further than the story of Sans Souici in Colorado https://coloradosun.com/2024/04/22/sans-souci-boulder-county-mobile-home-park-challenges/. It details the miserable failure that these deals become.

FLOWER POWER SCORE: 10

Elliott suggested that maybe there should be one rate cap for people on Social Security and a higher cap for people who are still working.

Oregon already has rent control. But some mobile home park tenants don’t think it goes far enough. They now want there to be two types of rent control: one for seniors and one for younger people. I know that using the word “socialist” has been worn out this election season, but that’s effectively what we’re talking about here. To quote Wikipedia: ”the goal of socialism is to distribute goods and services equitably”. Basically, it’s the inverse of the free-market capitalist system. If Oregon wants to change from capitalism to socialism, that’s fine I guess, but at least be honest about it.

BUREAUCRATS GONE WILD RATING: 9

Oregon Housing and Community Services, the state's housing agency, will auction off 140 defective modular homes in a series of two-week-long auctions. The state purchased the homes in 2021, with most of them intended to rebuild Royal Oaks Mobile Manor in Phoenix, which was destroyed in the 2020 Almeda Fire. Families who lost their homes in the fire were prioritized for housing. But last summer, the homes were found to be unfit to live in, due to mold, water leaks and other issues. There are unresolved questions about why the homes had defects. Now, OHCS has announced it will auction off the defective homes in an effort to recoup some of the approximately $24 million dollars it says it spent on them.

It is unbelievable that the State of Oregon spent $24 million on 140 mobile homes to begin with – that’s $171,428 per home! But what’s even crazier is that they spent all that money on homes that are so defective they can’t even be used. In the private sector, everyone involved in this would be fired. But my bet is that not one person will be held accountable. Oregon will lose $20 million at auction, and then spend another $24 million on the replacement homes, which means they will then have $300,000 in each mobile home. This type of wasteful spending is what separates the government from the rest of us and is why the average American has zero confidence that their tax dollars are being properly spent.

BUREAUCRATS GONE WILD RATING: 10

Based on the information presented in the article, the bureaucrats in Sedona are going to have a tough time trying to negate their written representations to the buyer that the mobile home park was legal for short-term rentals. Maybe next time they should write their certificates of zoning in invisible ink?

BUREAUCRATS GONE WILD RATING: 7

Based on the MIA team’s preliminary research, it appears many homeowners are unable to find full coverage on the standard market for mobile and manufactured homes in certain coastal areas in Maryland,” she said at the start of this week’s hearing. “Our research has also shown that surplus line carriers are beginning to limit their coverage for these homes, for example, by excluding wind coverage, or only writing [policies for] homes that are less than 20 or 25 years old.

The National Flood Insurance Program has created a monster. The result of the National Flood Insurance Act of 1968, it is the primary source of flood insurance coverage for residential properties in the United States. It is a coop of government agencies which issues over five million policies providing over $1.3 trillion in coverage. The program collects in only about $4 billion in annual revenue from policyholders’ premiums and the government funds the rest.

Now think about that for a minute. Those with homes in the flood areas chip in $4 billion against a total exposure of $1.3 trillion. How in the heck is that going to work? Effectively, the U.S. government has allowed people to build homes in flood areas – literally sponsored it – and has an unfunded obligation that is 30% of the nation’s total annual tax revenue. The damage in Hurricane Harvey was $200 billion. Hurricane Helene is thought to be about the same. Hurricane Milton was a bargain at around $50 billion. So let’s see, those $4 billion premiums should catch up on just those three hurricane losses alone in only 112 years, assuming there’s not another hurricane loss for the next century. And there’s no way out of this mess.

BUREAUCRATS GONE WILD RATING: 10

Concerned that the increase was a precursor of things to come under the new owner, tenants in the park initiated a petition drive to establish a rent control ordinance for mobile home parks. Tenants found such an ordinance in use in a town in California and revised it to be OOB-specific. The petition was submitted to the town in August, and was subject to a public hearing before the town council on September 3. The ordinance has been reviewed by the town’s attorney, and found to be acceptable. The council had two choices at the September meeting: approve it that evening, or allow voters to decide the matter in the form of a referendum. The latter was approved on a 4-0 vote.

So Maine apparently wants to be the next California. It makes complete sense that only mobile home parks should have rent control and that the bureaucrats have decided to allow the locals to vote on whether it’s a good idea or not, right? I wonder what would happen if the locals also voted on putting a cap on gas prices, food prices, insurance prices, and even car prices, because that’s the logical next step.

BUREAUCRATS GONE WILD RATING: 10

The owners of River Terrace told tenants in July last year that they’d need to move off the property by this past May. The eviction notices caught the park’s roughly 40 year-round residents, many of whom are low-income or seniors, by surprise.

You don’t see a whole lot of articles on Alaskan mobile home parks, but this one’s pretty ridiculous. The owner had already given the residents one year notice to leave the property prior to redevelopment, then the city tied it up in court for a year, and now the city has passed a new rule that states … park owners must give the residents one-year advance notice to close the park. Common sense would say that the owner has already met that threshold, but the crazy bureaucrats have now tacked an additional year on this saga with no compensation for the property owner who did everything right.

BUREAUCRATS GONE WILD RATING: 7

Florida is a “red state” in name only. I’m not sure if their goal is to go back to raw farmland, but you can’t go to people that have just had their homes ruined in a hurricane and tell them “sorry but now we’ve changed the rules and you have to spend another $50,000 just to put your $5,000 singlewide back on its lot”. This whole nightmare for Floridians began with the condo building collapse a few years ago followed by the empowerment of bureaucrats to make impossible demands on good-natured people who simply want to retire in peace (the going average is around $100,000 per condo owner for studies and structural refinement). Now Florida is stacking on similar “deal-killing” mandates for single-family and mobile homes. The result is that people are starting to leave the state in droves. I’m not sure what Ron DeSantis is thinking, but I’ve never seen a state so bent on self-destruction. Between the State’s inept attitude, the regular hurricane season and the lack of available insurance, the only thing residing in Florida may eventually be orange trees.

BUREAUCRATS GONE WILD RATING: 10

In an effort to keep rent costs low, residents attempted to purchase the parks. When this effort did not work, they began to explore rent control.

And if that doesn’t work, they’re going to slash the park owner’s tires? This has nothing to do with fairness or value but simply the “free rent movement”. These folks simply don’t want to pay rent regardless of what a great deal they’re getting.

AND THE GUILTY PARTY REALLY IS: PEOPLE WHO DON’T WANT TO PAY THEIR RENT BUT INSTEAD WANT A HANDOUT.

According to Kuschel, current residents of the mobile home parks pay around $500 in lot rent, but new residents will now need to pay an increased rent of $895. On top of this, the residents' lot rentals for next year will face a 10% increase.

Let me get this straight: a current tenant who pays $500 per month in lot rent is complaining because all new residents moving in will have to pay $895 per month. That would be like me complaining that I used Hotels.com to get a $100 rate while other people (who I don’t know) are paying full retail for the same room.

The new park owner even pointed this stupidity out:

Over the last few weeks, we’ve notified residents about all our improvement projects, which will result in an average rent increase of $52 that will go into effect on January 1, 2025. New residents moving to Southern Hills will receive landscaping services and be paying a rate that is more in line with the local market.

What’s really going on here? Some random ‘free rent movement” advocate wants to complain about things that are none of their business because, clearly, landlords are inherently evil.

AND THE GUILTY PARTY REALLY IS: LONELY TENANTS WHO WANT THEIR 5 MINUTES OF FAME

Some of Harbor View is still without power and much of the trash is still piled up. “When I first moved here this was a beautiful mobile home park and now we are living like trailer trash. It’s ridiculous. We pay way too much money to this big corporation to not have any consideration,” said Heffelfinger.

This Park was wiped out in Hurricane Helene and the residents are blaming the park owner for that. Good to see that even in a national crisis the “free rent movement” is going strong.

AND THE GUILTY PARTY REALLY IS: HURICANE HELENE

Electrifying and decarbonizing one home is a step in the right direction. But what if a whole neighborhood had cleaner, more efficient power? 

Sure, you would imagine that – at a time in which Americans have never been more broke – there would be more important items than “decarbonizing” mobile homes (you know, like buying food). Unbelievable that they would not be embarrassed to run this article.

AND THE GUILTY PARTY REALLY IS: WRITERS THAT HAVE LOST TOUCH WITH REALITY.

The city said “no” to building a new mobile home park

This year, residents overwhelmingly voted that down in the August primary, seemingly definitive.

And then the guy wanting to develop it appealed that vote and they voted again:

The appeal was unanimously rejected by the three-person board.

So now the deal is dead. What’s the lesson learned? Nobody – and I mean nobody – who owns property in the United States wants a mobile home park built anywhere near their property. That’s never going to change. And that’s why I’m so negative when people tell me they are going to start a venture to build new parks. It’s simply a futile mission.

AND THE GUILTY PARTY REALLY IS: THE SIMPLE TRUTH THAT THE PRESENCE OF A MOBILE HOME PARK DEPRESSES THE VALUE OF ALL PROPERTIES SURROUNDING IT

The only other option is to build the homes up in some cases 12 feet to make them compliant with the city’s flood ordinance. But given the cost and the layout of the two mobile home communities in town, that’s virtually impossible.

And now you know why Ronald Reagan said the nine scariest words in the English language are “I’m from the government and I’m here to help”.

AND THE GUILTY PARTY REALLY IS: THE CITY OFFICIALS.

Webb said the purpose of the regulations, specifically the 2-acre lot size requirement, was to ensure wastewater and sewer hookups were adequate.

Sure, it makes complete sense that single-family homes are fine on a quarter-acre lot but mobile homes require 2 acres under the new ordinance. And I’m sure that it’s to ensure wastewater hookups are adequate. No way it could be a way to make sure there are no more mobile homes brought into Tupelo, Mississippi, right?

AND THE GUILTY PARTY REALLY IS: THE NEGATIVE STIGMA AGAINST MOBILE HOMES.

In the complaint, Parkland Inc. alleges that former company employee Todd Storey, who the company says was in charge of reading the meter and reporting the readings to the city, resigned in November 2022 and vowed to “take (Gregg) Pardieck down for $250,000.” Pardieck is identified in court filings as the company’s president. Collectively from June 2021 to August 2023, Parkland Inc. reported using around 62.83 million gallons more water to IDEM than what it reported to Seymour’s water utility, according to records included in the complaint.

So let me get this straight. The park owner fires the manager and he “vows to take the owner down” by reporting that he under reported to the city 62.83 million gallons of water that had been dumped down the sewer line without any supportive evidence of any type.

For those who are complete idiots (apparently the city and the reporter qualify) 62 million gallons of water would equate to filling 62 football fields 10’ deep in water… and that’s how much this little trailer park supposedly used… and the city believes that… yeah right.

I hope the city has a really good attorney because the judge will have to be smoking crack for them to win. 62 million pounds of crack to be exact.

From the same Letitia James that brought you Trump’s bizarre victimless fraud case, she is now turning her legal prowess to solving the problems of some mobile home park residents who stupidly think they are using her to get rent reductions when, in fact, they will simply end up homeless once she fines the owners $3 million and shuts the park down. Smart.

Flint can’t even provide safe drinking water but somehow, they view a mobile home park as the most dangerous thing on earth. It would appear the city can’t get the park torn down fast enough – or at least before anyone questions why it can’t just be fixed up. Gee, I wonder why? After all, I thought that cities love affordable housing. That’s what they’re always saying, right?

So, the city has decided to unilaterally make 12 of the 16 parks in the city “seniors-only” without any authorization, process or approval from the government. Never mind that the city is fully aware it will never hold up in court. Sounds like they need to hire Letitia James as she doesn’t typically let the law stand in her way. Doesn’t It remind you of the scene in Blazing Saddles in which the outlaws are deputized by the corrupt governor and then given badges to which they shout “badges?... we don’t need no stinking badges!”

Manufactured houses, widely known as mobile homes, are one of the most affordable options for homeownership in the United States, but they typically come with a big risk: You own the house; you don’t own the lot it sits on.

That has made mobile home parks ripe targets for investors, who buy communities and then increase the lot rents to boost profits. It’s a massive industry: manufactured homes account for approximately one in 10 new single-family homes in the United States, according to a 2023 report by the Manufactured Housing Institute trade organization.

To curb investor involvement, the state of Maine ushered in a new law last year that requires mobile home park owners to give advance notice to residents if they intend to sell, giving the community members a chance to buy it themselves.

Let’s break this typical “free rent movement” narrative into the three positions presented.

Paragraph 1 says that mobile homes have one HUGE risk: the tenant doesn’t own the land. Well, that’s why mobile homes are so inexpensive to begin with. The average detached dwelling in the U.S. is $400,000 and the average mobile home is probably $10,000. By not owning the land under the home it becomes actually affordable for the bottom third of Americans that can’t afford $400,000. It’s not a risk or a problem – THAT’S WHAT CREATES THE OPPORTUNITY TO LIVE IN A DETACHED DWELLING FOR AROUND $500 PER MONTH IN LOT RENT. They DO sell mobile homes that come with the land. They are called land/home deals. They cost around $150,000 and up.

Paragraph 2 says that “private equity groups increase lot rents to boost profits”. All businesses – large and small – raise prices, when possible, to maximize profits. It’s called the free market system. It’s part of our economic structure called “capitalism”. The issue is not that private equity groups want to increase lot rents – everybody does – but what’s important to note is that this is possible because mobile home park lot rents are ridiculously low. Owners of office buildings and shopping malls would also like to raise rents but there’s no demand so they can’t do it. And so would airlines, car dealers and every other business on earth. But mobile home parks could double existing lot rents and still be the cheapest housing on earth. And stay completely full. And that’s why private equity groups are buying mobile home parks, because they’re a bargain. That’s also why investors bought Apple when it was a dollar a share and gold at $300 an ounce.

Paragraph 3 says that Maine’s new law gives residents a chance to buy the park. But the problem is that residents have no money, so that’s not who’s buying the park. Instead, this concept requires a non-profit to provide the down payment and another non-profit to personally guaranty the loan. And there are not too many non-profits wanting to do that which, as a result, makes the successful purchase of the park by the residents about as rare as a documented sighting of Big Foot.

Residents have described the living conditions as dangerous, citing and reporting problems such as rodent infestation, mold growth, and deteriorating floorboards in many units. These ongoing issues have made Cherry Lane Park a frequent topic of discussion at the Town of Southport's monthly meetings. Over the past two months, town officials decided to revoke the park's license to operate, which legally prohibits any residency on the property.

So the residents complained to the city and the city used them as pawns to get the park shut down and make them all homeless. When will mobile home park tenants realize that the city government is never on their side, but simply using them to find an opening to get the park torn down and a higher use put on that land?

STUPIDITY INDEX RATING: 10

First, let’s look at the improbability of the tenants buying the park:

O’Banion says federal grant money is needed to move forward with the $41 million land purchase — something she is unsure they will secure by Nov. 1.

There’s no way on earth that the tenants are going to find a federal grant of at least $10 million in three weeks for the down payment, and everyone knows that. This is the same government that can’t even get a $750 check to the victims of Hurricane Helene.

But there’s an even more worrisome part to these tenant-first-option pitches and that’s the way that the media frames it as a life-or-death predicament:

“History has shown that when an investor purchases a manufactured housing community there is economic eviction because the residents are not going to be able to afford the lot rent that the investor charges,” said O’Banion. 

Here’s where that argument falls apart. There are hundreds of mobile home parks that change hands each year and residents buy somewhere around 10 of those. That’s all. And I don’t see any uptick at all in the vacancy rates in those parks bought by professional investors. In fact, it’s the exact opposite. When a professional investor is the buyer they typically improve the park’s infrastructure, bring in homes to sell to occupy the vacant lots, and install professional management. This leads to a better living experience for the residents and makes detached affordable housing attainable. It’s a total contradiction to the claim that the residents are saddled with “economic eviction”.

The truth is that – and I urge you to research this – many properties that have sold to the residents have had nothing but declining conditions coupled with higher rents than even the professional buyer would have charged. The reason? Committees of residents are terrible managers of the property, having no desire to evict each other for non-payment as well as being incompetent stewards of the property.

STUPIDITY INDEX RATING: 10

This after their landlord’s 90-day notice to move their homes, stated the land was being sold and the new owner has other plans for the space.

I think I’ve been very clear for years now that there is a universal axiom that LOW LOT RENTS = REDEVELOPMENT. Contrary to what the “free rent” nitwits may tell you, mobile home park owners always have the option of simply cutting the park loose and building something else on the land. This trend is accelerating as apartment rents skyrocket and park owners are too insecure to match market numbers and, instead, simply elect to redevelop. Every single resident in every mobile home park would be smart to go to the owners and say “I’ll happily pay whatever the lot rent needs to be in order to keep the doors open”.

STUPIDITY INDEX RATING: 10