Mobile Home Park News Briefing

ALL IDIOCY:

If you’ve ever even considered buying a mobile home park in California, read this article and that should put an end to the discussion. What a bunch of lunatics.

ALL FACT AND NO IDIOCY:

While Point Dume Club is a bit of an outlier, mobile home communities are finding new favor among retirees and losing some of the negativity previously associated with these types of communities. Because getting a new community approved can often be challenging, existing properties are highly desirable. Communities can be solid moneymakers for investors because tenants rarely pick up and move their homes so vacancies are low.

"Some of the most profitable investments are in industries where demand is outpacing supply," Kristin Millington, director of manufactured housing and self-storage at Dallas-based Crow Holdings Capital, told Bisnow earlier this year. "That's the exact dynamic we see present in the manufactured housing space and we don't really see that changing."

Yes, that’s all correct.

JUST IDIOCY

The law requires that when mobile or manufactured home park owners prepare to sell their properties, they notify the residents. The residents then have the opportunity to form a homeowners association and purchase the park.

The association has the right to match existing offers and negotiate with the park owner to find mutually beneficial terms. If the owner finds another buyer, residents are supposed to be given the opportunity to match any substantially different offers.

The Shady Acres Mobile Home Park in Danbury went up for sale late last year, triggering the start of this process. Residents formed a homeowners’ association and made plans to purchase the property from owner Cajo LLC, but the deal fell through after inspections showed serious problems with water waste disposal systems that would be expensive to fix.

OK, the tenants had their shot and they blew it. You can’t ask later for a do-over. That’s not how the real world works.

JUST IDIOCY

Another vulnerability the residents face is the homes themselves; many were built in the 1970s and '80s and have exceeded their lifespan and have repair/ maintenance issues. The residents are often responsible for having to pay out of pocket for the repairs, Porter noted. HED determined that 62% of mobile home structures were 42 years or older.

I kind of thought that HUD’s 1976 takeover of manufacturing ensured that mobile homes are safe for continual residency and didn’t have “lifespans” like a dog or cat. That’s why they proudly have the HUD seal on the back – the government blessed them as forever homes. Right?

FACT VS. IDIOCY

IDIOCY:

“I think one of the biggest challenges that I've been hearing throughout the last couple years has been the maintenance of roofs and ceilings, and some of the decay over the years,” Addison said. “These are not meant to be permanent housing.”

FACT:

When asked if mobile home repairs are included in their responsibilities as landlords, the company said: “We do not own the mobile homes, and have never owned any of the mobile homes. The tenants own their own homes and are solely responsible for their upkeep as well as their yard and driveway.”

IDIOCY:

Addison, who is running for Richmond mayor this November, said poor living conditions also expose that landlords might not be taking care of infrastructure around the home.

FACT:

The Dressler Corporation, the Florida-based company that owns Mobile Towne, told VPM News via email: “We replaced all the water lines, sewer lines, roads, mailboxes and most of the electrical hookups. Cost over $1.? [sic] Million.”

EXTRA CREDIT IDIOCY:

Note that the mayoral candidate is claiming that mobile homes are not intended to be “permanent housing”. I’m not sure that HUD – or the law -- would agree with her theory.

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: 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: THE CHASSIS RULE WAS DESIGNED TO MAKE MOBILE HOMES NON-COMPETITIVE.

There's some debate about whether HUD's chassis requirement is primarily responsible for a massive, post-1970s drop in manufactured home production…

Gee, I wonder why HUD would have made it illegal to remove the mobile home from its hideous boat trailer foundation, thereby requiring it to sit 3’ off the ground and brand it with the “trailer” stigma? Let me think. Do you think it might be the well-funded single-family home lobby that could get their political allies with influence over HUD to derail the threat of $20,000 homes that look like $100,000 stick-builts back in the day? Nah, they’d never do that, right?

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.

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: HAVE A SENSE OF HUMOR, IT WON’T KILL YOU.

I’ve been in the “trailer park” business for 30 years and I sincerely doubt that anyone truly finds any of this so objectionable that they are going to lose sleep over it. We see this same stereotype shamelessly advanced in absolutely everything on television and the movies.

ST. PETERSBURG — A candidate for City Council has removed posts on social media about a Catholic school fundraiser she hosted two years ago under a “trailer trash tragedy” theme. In May 2022, Torrie Jasuwan posted about the party at her home that included several photos of party guests dressed in ways that promoted stereotypes, including exposed bra straps and fake tattoos. Several were photographed with plastic red cups and cigarettes in their mouths, with one sporting a fake pregnant belly. “Such an epic “Trailer Trash Tragedy” murder mystery party-party for HFCS this weekend!” Jasuwan wrote. “Now to think of our theme for next year...”

The only one who cares about this story is this person’s political rival for that city council spot.

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.

Here’s the actual housing stats for Springfield, Massachusetts:

• Single family home price average is $240,800
• 3-bedrroom apartment rent is $1,540 per month.

Against that backdrop, the tenants of a mobile home park have filed suit stating that a rent of $503 per month is abhorrent, unjust, and every other adjective they can think of:

A housing court judge promises to make a decision about a mobile home park’s rent increase appeal by the month’s end. But first, the tenants’ lawyer will file new documents hoping to sway the judge’s decision. Effective Feb. 1, the West Village Mobile Home Community received a nearly $300 rent increase — going from $207 to $503.06 a month — for the land on which their mobile homes sit.

The foundation of their argument is that the rent is going up 150% to get to $503 per month. Apparently what the tenants are hoping is that by focusing on the 150% the judge will somehow be blinded to the fact that – at the new rent – the mobile home park is 66% less than an apartment, and around 90% less than a house.

They better hope that the judge is a total idiot.

I believe that the McDonald’s Value Menu Cheeseburger has gone from $1 to $3.15, which is a 215% increase. But that’s 50% of the cost of the cheeseburger at other restaurants. Get the picture?

COMMON SENSE ALERT: WHEN YOU BUY THE PARK TO TEAR IT DOWN YOU ARE NOT “SAVING THE PARK”.

This story is so stupid that it’s hard to believe I’m the only one calling them out on it. For several weeks now, the media has been raving about how Charlottesville is “saving the mobile home park” by helping Habitat for Humanity buy the property to then tear it down. They’re not even trying to mask the fact that the wrecking ball is already being lined up.

This comes after it voted in early August to join efforts along with Habitat for Humanity and the Piedmont Housing Alliance to save the park. The City will help financially by committing more than $8 million over a five year time span. The money will be considered a loan. There will be a minimum of 180 units. At least 70% of those rentals will be for households with low to moderate incomes. This is just one component of what would be an overall project involving lots of different eventual requirements from different funding sources,” Councilor Michael Payne said. Construction is set to begin by December 2029 and to be completed by December 2033.

So apparently when Habitat for Humanity tears a mobile home park down they are “saving it” and when anyone else does they are “forcing residents into homelessness”. Pathetic.

COMMON SENSE ALERT: A FIRED MANAGER IS PROBABLY NOT YOUR BEST SOURCE OF NEWS.

I knew this article would be interesting when I saw that the main protagonist was the manager that the new owners had just fired. Here’s her side of the story:

Schumacher said during her time as manager, she noticed glaring issues from ownership, stating they don’t even have an operating license.

“Our license for our address is still under the former owner. It expires at the end of this month,” she said.

And then you have the response from the owner that fired her:

“We have worked cooperatively with EGLE, and Water District 1 in Lee Township to get the residents a better-quality water coming from the municipal water system. And that’s gone into place. And now our efforts will focus with the new manager on further cleanup of the park. And we’re also working on taking some of the abandoned trailers and getting them into shape so that new tenants can come in to make it a more robust community,” Cherin said.Cherin also said that the company was having issues with Schumacher’s performance, and they gave her ample time to improve. When that didn’t happen, she was let go.

And then you have her rebuttal in which she proclaims that she’s only speaking out for the good of the nation and not because she’s mad that she got canned, of course:

For her part, Schumacher said she’s not a disgruntled former employee, she just wants what’s best for the residents.

You would have to be a complete idiot not to see through this story.

It’s also important to note that when you turn-around a mobile home park there’s a delay between closing on the property and getting things done. You have to line up contactors, get permits, get the correct weather and many other items. Once again, common sense would make this readily apparent to anyone who is not a complete idiot (which the author of the article is sadly guilty of being)

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.

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.

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.

"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!

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?”.

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.

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.

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.

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.

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.