Mobile Home Park News Briefing

Another park that might have been saved with higher lot rents. Instead, as always, LOW RENTS = REDEVELOPMENT. 

Tester’s Manufactured Housing Community Sustainability Act would create a 75% federal tax credit offsetting capital gains if the property is sold to a resident-owned cooperative or nonprofit. This economic incentive would help preserve more manufactured housing communities and keep more families in their homes, while protecting the long-term viability of this important piece the affordable housing market.

Well, this is sort of on the right track. The future success of keeping mobile home parks from being redeveloped could be achieved with aggressive tax abatement. I wrote an article years ago when a Congressman proposed that there be no capital gains tax charged when a mobile home park is sold without being redeveloped. Of course, that concept didn’t go anywhere. But tying that idea to selling to the residents is a death sentence for this vision to have any real impact, as the odds of the tenants successfully buying any park is about .00000000001%. If you remove that roadblock, you might really have something of value. Hopefully, Tester will soon realize this to be the case.

More common sense takes hold! This is the way to preserve affordable housing: by helping park owners and mobile home residents make upgrades to homes, particularly in areas with severe weather risk.

I wish more counties would take this approach with their infrastructure funds.

Another positive article about a city government realizing the importance of preserving mobile home parks.

This can’t be happening! Where did all the wokesters go?

Madison Township trustees have denied a rezoning request that would have allowed for the expansion of a manufactured-home park in the community. Trustees, during a recent meeting, voted unanimously to reject a zoning-amendment application submitted by James Place Properties Inc.

I find it endlessly amusing that people inside our industry (and on Biden’s soon-to-be-unemployed advisory team) claim that there’s a new era of mobile home park construction right around the corner when the truth is that absolutely no city or town in the U.S. is ever going to allow new park construction under local zoning laws.

I will note that another week has passed without a single person responding to my simple challenge to send me the information on any new parks that have been actually built and opened in the U.S. (not just talked about, applied for, or investor funds raised). The “new park narrative” is blatantly false and anyone who has ever actually applied for a permit to build a new mobile home park already knows that.

Kerr Properties intends to rezone the site to industrial use.The letter points out that the company contacted 20 nonprofit agencies seeking assistance in the relocation and support tenants.“The response to our appeal for help from these agencies was extremely disappointing with only one group responding. Fortunately, PIERS stepped up and offered assistance to all those willing, and in coordination with our relocation coordinator successfully relocated all tenants.”

Another article about a mobile home park being torn down to build a more profitable industrial use. What’s interesting about this is that 19 out of 20 non-profits rebuffed any assistance to the residents in relocation efforts. This further supports my theory that most non-profits only interested in fundraising or publicity – not because they actually care about people in need.

Finally, a fair and balanced article about the mobile home park industry! It talks about the stigma against “trailer parks” and then goes over the benefits with profound accuracy. It notes that the buying decision was not made because mobile homes are “mobile” (which is why this person also bought an RV for travel) but because they are cheap and offer more financial freedom. She also likes the “support network” which her neighbors provide (and which Time magazine raved about a few years ago).

It appears there are still real journalists out there!

This sale is happening during a time when mobile home parks are rapidly disappearing all over the country. Statistics about this are surprisingly difficult to find, but the Associated Press reported on the trend last year, as did Forbes and Time. This is important because mobile and manufactured homes are the single largest source of non-subsidized, affordable housing in the United States, according to the U.S. Office of Housing and Urban Development. And once they’re gone, the parks are not being replaced. That is certainly the case in the Charlottesville area. Carlton Mobile Home Park is one of just two remaining parks in the city, and one of six if you include parks in Albemarle County. In the last 15 years or so, the  area lost at least four parks.

We’re on a roll this week. Another fair and balanced article. Looks like journalists are starting to realize that the big stories to cover are parks being torn down because rents can’t support keeping them as mobile home properties, not “evil landlords who raise rents”. Maybe media groups are finally taking back the reins from young, woke writers after the terrible Biden debate performance and the inevitable end to the age of stupidity.

When Sylvester moved to the park, the rent for each lot was $359 per month, which she said was affordable as someone living with a disability and working at Stop & Shop part-time. Months later, the rent control board approved an increase to $410, and Leisure Woods management is now seeking to raise it to $588. “I haven’t even lived there two years, and if you take $588 out of my income that leaves me with nothing to survive on,” Sylvester said. “I would be forced to sell.”

Back to the old worn-out woke narrative that a mobile home park lot rent of $588 is too high in a market in which the single-family home is $265,000 and an apartment is $1,420 per month. Only a total fool would believe that narrative. But what’s more troubling is the writer’s contention that it is somehow the park owner’s responsibility to provide housing to people who claim to only make $600 per month. The writer forgets that it’s the government’s responsibility to house people who can’t survive in the real world under the Section 8 program (which has about a 5-year waiting list), not the park owner. In looking at the profit-and-loss numbers provided to the rent control board, I have no idea why this owner has not demolished this park already and redeveloped it into a more profitable use. They better not push the owner into that position – it’s a miracle that he’s willing to even accept $588 per month to begin with.

HARNETT COUNTY – Harnett County commissioners denied a rezoning request from a couple who said they wanted to bring affordable housing to seniors in the Chalybeate Springs area at its meeting June 17. The final decision came at the end of a heated, gavel-banging debate. 

Yet another example that there is absolutely no chance on earth that there will be any meaningful new construction of mobile home parks in the U.S. in the years ahead. I will note that not one person responded to my offer last week to educate me on all these supposed new mobile home parks that have somehow been built nationwide but that I’ve never actually seen any evidence of. If you do ever come upon one of these Big Foot sightings please send the new park’s name and address to me. I’ll keep everyone posted on the results.

Have you ever been to Delaware? Nobody wants to live there, nobody wants to visit there, and nobody wants to invest there. Crazy new laws such as these only further make the state dead in the water as far as any revitalization efforts are concerned.

Mullin said Sharpe could sell the property and the development would have to move to another location since it's no longer in escrow, but he would like to see the development move forward in the same location. Sharpe didn't respond to a request for comment.

Gee, what a shocker – another new mobile home park development that never got off the launch pad. When will people learn that this stuff is just never going to happen? To build a new park you have to go so far out in the middle of nowhere to get the permit that no bank will finance the deal, and there’s nobody who wants to live there even if you built it.

I don’t know any of the facts in this case, but this appears to be simply one side of the story. The facts of this narrative have nothing to do with the fairy tale of the “big, evil landlord” but simply revolve around the lease term and quasi-rent control rules of Massachusetts. Those black-and-white items can be resolved in court. But clearly this article is written by a writer with “landlord derangement syndrome” and there is much included that not only has no bearing on the story but is clearly just an attempt to manipulate the reader, like swinging a gold pocket watch in a 1940s hypnotism movie.

Clearly, this park is going to be torn down, as the purchase price of $7 million equates to over $100,000 per lot for this dilapidated property. And the writer is correct that mobile home parks are being redeveloped at the fastest pace in American history:

Its sale is part of a national trend: Mobile home parks are disappearing across the country — fast. Statistics on this are difficult to find, but there are reports around the country of parks being sold, demolished and redeveloped. The Associated Press reported on the trend last year, as did Forbes Magazine and Time Magazine. As housing prices and land values rise dramatically, developers are buying up the parks, forcing residents out, tearing down the trailers, and building more traditional housing in their place.

But what I find offensive about this writer’s spin on the story is this quote:

When a mobile home park is sold, residents are usually displaced one way or another, say attorneys familiar with Virginia’s Mobile Home Lot Rental Act who spoke with Charlottesville Tomorrow. Either the new owner raises the lot rent beyond what the current resident can afford, or decides to use the land for something else.

Clearly, the only way that a park like this would NOT be torn down is for the lot rent to go up to a level that the park is actually worth over $100,000 per space based on the true operating net income. If residents don’t want to pay market levels then, yes, the park gets demolished. It’s not rocket science. So maybe the solution is for lot rents to go up to levels high enough to make sense for some mobile home parks to stay in that line of business. It’s a total lie to claim that park buyers lose all of their tenants (more like between zero and 1%) when rents go up, and equally false to imply that the owner actually intends to displace them in the first place. But, yes, there are marginal tenants in every property in America that may not be equipped to handle modern housing costs (and not just in mobile home parks) and they need to swiftly be placed into Section 8. To claim that higher rents are inherently bad is just plain stupid, as that lame theory serves as the trigger for redevelopment and displacement of all of the residents as opposed to just a few, if any.

What started as a win for residents of Little Woods Mobile Villa last week – as an arbitrator struck down a massive rent increase put forth by the park owners – quickly soured when those same park owners issued yet another proposed rent increase and formally notified the city of their intention to permanently close the park. “We will continue to arbitrate annually until we are either able to achieve long-term viability or are forced to cease operations,” said Nick Ubaldi, whose family owns the park and who oversees its day-to-day management, in an email to reporters.

For how many years have I been explaining LOW RENTS = REDEVELOPMENT. It’s called common sense. The tenants may have won the battle but they lost the war. Instead, their focus should have been to ask “we know you need to make a good return on your investment or you’ll redevelop this place, so how much does our rent need to be?” and then happily paid it on the first of each month. That would have saved the day.

What’s equally sad in these articles is that the residents are often mislead into these losing positions by non-profits suggesting that the tenants have legal rights which they simply don’t. They effectively empower these people to become homeless, then move on to lunch at the country club.

The City of Moab bought the mobile home park in 2018, with the intent of turning it into an affordable housing development. Six years later, there’s no development and no plan in sight.

You have to love the hypocrisy of the media, which has no problem when a city shuts a park down but, when a private sector landlord does the same thing, they demand capital punishment.

I know nothing about this case and the details involved, but the legal issues listed can easily be resolved in court and will probably do nothing more than delay the rent increase for a few months.

But what I take offense to is this quote:

“The crux of our complaint is that this out-of-state company has come into our community and bought up a number of mobile home parks in the area …”

Week after week we get these woke journalists trying to brainwash America that somehow out-of-state landlords are inherently evil as opposed to in-state owners which are better. Why? Of course, the answer it they’re not any different, but it’s all part of some stupid wokester narrative that big private equity groups are going to rule and destroy the earth and, since they are all located in New York, any park that’s not in the “Big Apple” can be slapped with this type of label to somehow hurt private equity group morale and make them cry. It’s about as convincing an effort as those who are now trying to brainwash America that Joe Biden did fine in last week’s debate. It’s just not going to work. 

“President Biden and I believe that every American deserves affordable housing, so they have a roof over their head and a place to call home,” said Vice President Harris. “That is why we have a plan to build millions of new units of affordable housing in communities all across our nation, which will bring down the cost of housing for renters and help more Americans buy a home. Today, I am proud to announce that we are taking a critical step forward by investing $85 million to help more than 20 communities throughout our country remove barriers to building more affordable housing.”

That sounds like a speech Huey Long would make in the 1930s to energize poor, stupid voters by claiming he would “put a chicken in every pot”. After last week’s debate and Supreme Court ruling, we all know that absolutely nothing will come of this and it’s just an attempt to appear relevant and distract voters from bigger issues like Biden’s disastrous debate performance.

As for this one particular program, the total value of all U.S. single-family homes is around $35 trillion. So exactly what will be accomplished with $85 million? Nothing more than a few non-profits engaging in meaningless studies. This is as stupid as me giving a televised speech in which I proudly announce that I will be investing $5 in space colonization, to move the needle on building a vast colony in the sky. But at least I won’t require a teleprompter.

Apartments slated to replace the Meridian Mobile Estates mobile home park in Puyallup have encountered delays, leaving some former residents frustrated.

Here’s another park being torn down to build apartments. Gee, I wonder if there are many parks being torn down right now? Umm …yeah, I guess so.

A state lawmaker says large corporations are buying up mobile home parks in Florida and jacking up the prices. In two weeks, a new law, HB 613, takes effect to try to stop it.

So the idiots in the Florida legislature have decided that the best way to keep parks in operation (in the same state where insurance rates are up 400% -- if you can even get it) is to make it less compelling for private equity groups to invest there. Smart move IF YOUR GOAL IS TO TEAR DOWN ALL THE MOBILE HOME PARKS IN FLORIDA. Who do you think even wants to buy a mobile home park in Florida when the state has become hostile to business owners and landlords of all types? Clearly, the better use for many of these parks is to simply redevelop them into uses that are far less litigious and politically ensnarled with crazy politicians.

The best thing going in mobile home parks today are private equity group buyers. They are the only ones that are willing and able to inject the capital needed to bring old parks back to life and to make them profitable again. And, yes, they will definitely raise rents to provide a good return on their investment. But the residents will have a higher quality of life when they’re done and – equally importantly – they will not be displaced by the wrecking ball. Given the fact that most mobile home parks in the U.S. are around 70 years old and mom-and-pop owners have never kept them updated, only buyers with deep pockets can turn around large parks that often have price tags of $10 million to $50 million.

I have driven far more mobile home parks than probably anyone reading this (I drove 100,000 miles in 2019 alone visiting our properties) and I can tell you from experience that when you drive into the nicest parks in America they are invariably owned by private equity groups. Yes, that’s right, those “greedy”, “out of state” entities that the media and government hate. They are the very future of a large section of this industry, if it is to survive and not be redeveloped. We need new stewards of affordable housing and professional owners are the only ones qualified for that role. Don’t believe me? You need to go drive lots of parks, find the nicest ones with the happiest tenants, and then research who the owners really are. The proof is found in the pudding, not in the words of some stupid bureaucrats from Tallahassee who have probably never been inside a “trailer park” in their entire lives.

Residents point to back-to-back rent increases, which they say is a result of "corporate greed."

In a world of stupid quotes, this one has to be the winner. If these residents have not noticed (and you know they have if they drive a car, shop for food, have insurance, or pay utilities) the prices under the Biden administration have risen more than 20% in the past three years. I don’t think it’s fair to say that raising lot rent every year is a sign of “corporate greed” but instead “corporate survival”.

What a ridiculous and non-supportable position to take!

They are also worried about redevelopment, pointing out the park is located on prime real estate about a mile from Patriot Place and Gillette Stadium and near highway access. The Cormier family that has owned the park for years has a June 6 sales agreement for $6 million with a Mark Blanchette, according to a letter dated June 12 from the owners to the tenants. Under a fairly new state law, tenants have first rights to buy a mobile home park put up for sale, and the owners provided a copy of the state law with their notification letter to the tenants as required. “The tenants have right of first refusal. They can purchase it before anyone,” owner Janet Cormier told The Foxboro Reporter. Tenants met Saturday morning to learn more about such a move. A total of 31 tenants turned out to the meeting held in the park.

Clearly this park is going to be torn down and redeveloped. The price appears to be more than $100,000 per space and the tenants clearly can’t possibly make the numbers work for the park to remain in operation. But despite the fact that there is absolutely no chance of success, the seller must waste a few months giving the tenants a shot at doing the impossible. The residents would have better odds pooling their money and buying a winning Powerball ticket to pay for the purchase.

“In King George, the zoning for mobile home parks is A-3 and there is very little A-3 property in King George,” Palivoda said. “You’re not going to see any more trailer parks with the current zoning. It would be more honest for them to say, ‘Trailer parks aren’t allowed.’” 

This is not really a story about a city that is blocking the use of the existing mobile home park lots – because the owner fortunately is near full occupancy – but is more a story about the simple fact that cities and counties nationwide are never going to allow any new parks to be built. But, of course, they won’t say that to your face, instead adopting the politically correct stance of “we love affordable housing and would love to give you a permit if you can only meet these one-thousand impossible conditions”.

I’m sure the owners of this park are relieved that they now can move forward to tear the park down and redevelop it, having given their best shot at keeping it in operation yet being very publicly rebuffed. I’m always amazed that people don’t see the cause and effect of restricting lot rents when it’s all around them. $5 bet the next time you hear about this park will be the announcement that it is being redeveloped into apartments.

Another story about a mobile home park being torn down and redeveloped into a different use – this time as single-family home lots. Spotting a trend here?