Why You Should Join Your State Manufactured Housing Association By Dave Reynolds

When I got into the business over two decades ago, I didn’t even know that Manufactured Housing Associations (also known as MHAs) existed. Back
then there was no internet to speak of, and most community owners were not that social. But then I found the TMHA (the association for Texas) and I knew that I had found lasting friendship. I have remained a loyal member for over a decade.
So why should you join your state MHA?

They do great things for the industry

In the case of the TMHA, they have literally re-written the laws of the State to the betterment of community owners. Take for instance the revisions to grandfathering law that were passed a couple years ago. If you own a property in Texas, the city now has no power over you to utilize all of your lots. And they succeeded in fending off the HUD desire to take over home installations and cost all owners around $7,000 in site preparation fees. The list goes on and on. And that’s also true for many other state associations. They are basically the lone group watching out for you on a national stage.

They offer outstanding resources
If you need to know anything from water billing laws to habitability minimums, your state association is the one stop resource. If you need the name and number of a great
municipal attorney, they’ve got it. If you need to know if you can add administrative fees to a water bill, then call the MHA.  From their directories to their simple summaries of state law, they are 100% invaluable. They shortcut the learning curve by years.

They encourage discussion between owners and a sharing of ideas
Have you been to an MHA event? The whole purpose is to share ideas. They have no intention of selling you anything and they don’t care if you own one property or 1,000. It’s simply community owners gathering to share ideas and war stories. We have made many friends through associations, and know you can do the same.

They can be enormously helpful in a pinch
When the chips are down, you need an ally. Your MHA is a great first responder when you have a problem with a governmental agency. We have gone to them many times
with complicated issues and they have helped us solve them.  Having your state association call and support your cause has a real impact on bureaucrats, and having a support network gives you greater peace of mind.

The dues are insanely cheap
For all the reasons above, the dues to join your state MHA are ridiculously low. In terms of value for your money, it’s hard to find a better thing to do. I think that too many people never bother to check out the dues structure and just assume they can’t afford it. It’s seriously cheaper than some newspaper subscriptions. With as much as you have invested in your property, how can you rationalize not joining? How will you be able to explain to forgive yourself for missing out on that law change because you were not in the information pipeline?

It’s the right thing to do
Progress in any industry comes from a collective effort. It comes from investment spending. All the benefits that we have today – all of the advances – come from people years ago deciding to invest their time and money to make them happen. Rome was not built in a day and neither has been the manufactured home community business. The right thing to do is to join in the effort to take our industry to the next level. And that’s what your state MHA does.

I’m glad that Manufactured Housing Review is getting involved in promoting and supporting MHAs
When I heard the rumor that Manufactured Housing Review was changing its format to dedicate itself to the promotion and expansion of the state MHAs I was thrilled as I knew that was the right direction to go. While MHVillage can continue to provide the same old articles and ads with their old-fashioned printed quarterly publication, only MHR can offer real-time internet delivery on a monthly basis of the latest news,
announcements and activities of all state associations.

Conclusion
I’m very proud to be a member of 28 different state associations – one for every state we own properties in. And I’m also proud to be a writer for MHR as it endeavors to become the one collective voice for all the state associations. I’m looking

Dave Reynolds has been a manufactured home community owner for almost two decades, and currently ranks as part of the 5th largest community owner in the United States, with more than 23,000 lots in 28 states in the Great Plains and Midwest. His books and courses on community acquisitions and management are the top-selling ones in the industry. He is also the founder of the largest listing site for manufactured home communities, MobileHomeParkStore.com. To learn more about Dave’s views on the manufactured home community industry visit www.MobileHomeUniversity.com. This article originally appeared in the Manufactured Housing Review, subscribe for free here.

Why Part of the Rise of the MH Sector is Based on Mistakes by the SF and MF Industries By Frank Rolfe

am firmly convinced that the manufactured home community industry has fallen into one of the most envious positions of any real estate sector in U.S. history. We are literally on top of the world based on every mega-trend. But part of our success has to be credited to the poor performance of the single-family and multi-family industries and their key strategic mistakes. So how did the SF and MF industries blow it?

Failure to position themselves for the sweet spot on housing demand

While affordable housing is one of the hottest sectors of real estate, not everyone got in position for it. A recent speech at the Texas Manufactured Housing Association’s
annual meeting pointed out the fact that it’s fundamentally impossible to build a $100,000 stick-built home today, since the average lot alone in most major markets is
over $50,000. As a result, there’s no way you can build an affordable housing product in the single-family home sector. Meanwhile, with the average apartment rent in the U.S. is well over $1,000 per month, there’s no way that apartments can tap the affordable housing market unless they are subsidized by the U.S. government through Section
8 – and that program’s broke. Apparently, these groups were not paying attention to the entire affordable housing segment. Could it have gone better? Single-family builders
could have put a greater focus on building a smaller home product with more efficient methods and apartments could have followed suit. But they missed out on it completely.
And now it appears to be too late.

Poor property condition in Class B and Class C apartment holdings

While Class A apartments are well-maintained, Class B and C apartments cannot say the same. Many of the largest apartment portfolio owners sell off their oldest and weakest properties to moms & pops who do not have the capital to make needed
repairs. A whole bunch of the apartment stock in the U.S. is literally falling apart. These poor conditions push residents into looking for alternative housing that offers a better value: and one of the best alternatives are manufactured homes. We give the resident amenities that no apartment can, namely 1) no neighbors knocking on walls or ceilings 2) the ability to park by the front door 3) a yard 4) a sense of community and
(perhaps most importantly) 5) the ability to be a homeowner and not a renter.

Not finding a way to limit supply or build a “moat”

Probably the feature that manufactured home community possess and other housing sectors most envy is our barrier to entry, which Warren Buffett would describe as a “moat”. We have it because city governments have decided that they collectively don’t want any new community construction. But those same city father’s love more single-family homes and apartments, and that affection is a curse from a supplyside perspective. We’ve always been told that home and apartment builders keep developing new properties until the banks stop them – typically when the cycle is far too late – and that seems to always be the trend. While you rarely see manufactured home communities end up in foreclosure, look what happens to SF and MF all the time. Remember what happened during the Great Recession? And it’s too late to convince city government to offer more restrictive zoning on SF and MF and keep competition at a more reasonable level.  Why should they?

Conclusion

We honestly feel sorry for SF and MF owners. They have business models that are lacking the right raw material for the years ahead. They have peaked and have nowhere to go but down. And their lack of planning and execution has offered a terrific boost to manufactured home communities. Part of our success is how good we are, and part is simply how bad they are. Since neither is likely to change, we’re in a great position
going forward.

Frank Rolfe has been a manufactured home community owner for almost two decades,
and currently ranks as part of the 5th largest community owner in the United States, with more than 23,000 lots in 28 states in the Great Plains and Midwest. His books and courses on community acquisitions and management are the top-selling ones in the industry. To learn more about Frank’s views on the manufactured home community
industry visit www.MobileHomeUniversity.com.