Some 22 years after the last peak in manufactured home (MH) production was achieved, manufactured housing shipments are still only about 25 percent of their 1998 levels. While it is useful for the narratives of those in the industry who peddle ‘happy talk’ to compare the MH industry to its low point of 2009, that fails to ask address questions. What caused that low of 2009? Or what caused the industry’s slide from that last peak of 1998?
Hold those thoughts.
Meanwhile, despite the glee of the industry’s consolidators, the manufactured home community sector is stuck in its own vexing ruts. The numbers of pre-HUD Code mobile home parks and post-HUD Code manufactured home communities that were developed has been marked by a steady drop in the number of such properties. Since 2000, that decline is estimated to be in the thousands of fewer land-lease properties in 2020 than existed then.
Who says? Manufactured Housing Institute (MHI) members. One example is shown below, using Datacomp’s figures.
The decline in land lease communities, and the relatively few that are opening are due to several factors. They include a widespread rejection of acceptance of new communities for development. Who says? A prominent manufactured home community designer and developer, Don Westphal, who is a well-known MHI member and association cheerleader.
That dearth in acceptance of new developments in turn is fueled by the lack of understanding and thus acceptance of the industry’s homes. That’s sometimes aptly referred to as the image issue or the acceptance of the public of outdated stereotypes. Who makes such claims? Once more, it is implied by MHI member Don Westphal. Let’s note that his business includes upgrading and developing new communities.
Beyond his perspective, the data from third-party Zillow supports Westphal’s claims. Zillow has made clear that interest in manufactured homes has declined during an affordable housing crisis, and while not pointing the finger at MHI, that has occurred during the very years that MHI claims to be ‘promoting’ the industry.
Even prior MHI Chairman Joe Stegmayer, on a video shown in the report linked below, admits that manufactured housing remains a largely ‘untold story.’ Well if that is true – and the evidence supports that claim – then who is there to blame for it, beyond the trade group that he led and claims to be promoting manufactured homes and living?
Note that each of these problematic issues are being documented by MHProNews using the statements of pro-MHI members or third-party sources of information. Note too that these problems are either glossed over or ignored by pro-MHI publications and echo-chamber cheerleaders.
Put differently, what’s vexing about this pattern is that MHI ‘leaders,’ when asked privately, reportedly attempt to dismiss the concerns based on an unproven claim that this publication peddles ‘conspiracy theories’ or is otherwise biased against them or the industry. That’s not only untrue but is contradicted by their own leaders public statements. As MHProNews approaches the anniversary of our 11th year of publication, it is a good time to recall that we launched this platform as a pro-industry resource to examine problems, point to proven solutions and thus fuel the return the industry to robust, sustainable and ethical growth.
So, the purpose of ‘true state of the manufactured home industry’ reports like this one is to spotlight the root issues so that they can be dealt with in an honorable fashion.
As even this brief survey reflects, a closer look at their own data and their own members and affiliates statements often points to the opposite of their claims of promoting the industry or claims of ‘momentum.’ They can’t have it both ways.
When pro-MHI cheerleaders are not busy peddling the ‘MHI party line,’ they ironically are among those that even this brief historic trends review admit in their own words reveal numerous and in various ways perhaps worsening problem areas.
But playing devil’s advocate for the moment. Even if every MHI member always stuck to their association’s party line as reflected out of locales like Omaha, Knoxville, Chicago, or Arlington – the facts and third-party research makes it clear that the trends reported here and on our MHLivingNews sister site contradicts the ‘sunshine and roses’ – or ‘we are working on this or that on behalf of the industry’s’ claims by MHI and their ‘leaders.’
To demonstrate that, the following will illustrate the point. Once more, persons involved for years with MHI and the industry will make the point.
Industry Investor Says Outperforming Requires Contrarian Thinking, Action
“In order to outperform the market, you have to have a contrarian point of view,” said Robert “Bob” Robotti, to the investing media resource, the Motley Fool. Robotti’s firm has been called a “top money manager” by Money Manager Review. They have described their investment methods like this. “Our approach is through classic value investing as pioneered by Benjamin Graham and as interpreted by our analysts.”
Robotti, years ago, teamed up with Chris Stinebert, who was then president and CEO of MHI. They did joint presentations to potential investors to explain the reasons why manufactured housing could be the wave of the future. See their media release, linked here.
But that was 2004, early into the Berkshire Hathaway entry into manufactured housing. As MHProNews has reported, Robotti’s firm cut their stake in Cavco Industries, for example. It wasn’t the first time they cut their positions in CVCO, even during the Stegmayer leadership of the firm.
Why wouldn’t Robotti dump Cavco (CVCO) after what an insider from the publicly traded firm called their “debacle” under Stegmayer? As the old saying goes, “Fool me once, shame on you. Fool me twice, shame on me.” For those who might think that Cavco Industries has after months of posturing and publicity about their so-called reforms magically ‘changed the spots on a leopard,’ see the latest revelations on the report linked below from our headlines for the week that was on that firm. Nor are these the only warning signs for the company. After all, the failure to make Cavco’s failure to get their acquisition of Lexington Homes to perform after their buyout brought concerns that they bought it to close it, which if so, would be an antitrust violation.
Chris Stinebert, sources at MHARR have said to MHProNews, at times clashed with MHARR leaders. But there was mutual respect.
That was made manifest by the passage of the Manufactured Housing Improvement Act of 2000. MHI, MHARR, and the Texas Manufactured Housing Association (TMHA) under the guidance of the late Will Earle, J.D., came together to pass a law that laid the potential future for the industry to overcome the discriminatory behavior that had limited the industry for so long.
Not only did they pass the law by working together, but for a time, MHI – during the Stinebert era pre-Warren Buffett’s leading the takeover of Clayton Homes, 21st Mortgage Corporation, Oakwood Homes, and their leading – MHARR, and various state associations worked together to advance the industry. See the epic leaked MHI document linked here as one piece of evidence for that statement.
The possible takeaways are many. But what Stinebert’s exit message, Robotti’s pull back from MHI member Cavco, and the words of MHI award winner Marty Lavin are all from voices that were aligned with MHI. These are not MHI naysayers, rather, they were or still are among the association’s supporters.
Fast forward to our time, and Mary Gaiski candidly told mainstream media that discrimination against the industry is increasing.
In the light of these statements – often from pro-MHI sources – what the Ohio Manufactured Home Association Executive Director Tim Williams said recently and earlier this year in widely distributed emails to MHProNews and other state executives looks absurd on its face.
Note the clever dodge that OMHA’s Williams attempts to deploy to the unsuspecting who read the following emailed remarks?
Williams knows that MHI has worked to limit or bar MHProNews from these events, as a memo from MHI’s then general counsel Rick Robinson obtained by MHProNews reflects.
Rephrased, OMHA’s Williams changed his posture on debating the so-called effectiveness of MHI, Lesli Gooch, Mark Bowersox et al, just days ago with a new pre-condition. That pre-condition was one that Williams knew MHI and their leaders would never allow. It was a blatant ruse that only those in arguably in the dark about the details would buy into.
Put differently, MHI, their leaders and mouthpieces – which seems to include OMHA’s Williams – are unwilling to debate the facts presented above or linked herein. It is a de facto admission of their inability to disprove the contention. Which leaves several embarrassing-to-MHI contentions made by Andy Gedo’s – ironically on behalf of MHI – undisputed too.
It’s a prima facie case that MHI is – as MHProNews has alleged – operating a deceptive and fraudulent scheme that industry insiders have launched to use the association to consolidate the industry while allowing or fostering underperformance.
Instead of embracing the opportunity to debate these types of evidence-based concerns outlined herein that have often come from voices inside or supportive of the pre-Berkshire era at MHI, Williams attempts to set up a new condition to debate MHI’s supposed effectiveness and his arguably absurd claim that Gooch is the best he has ever seen in 25 years. His ass-kissing of Berkshire by name, goes against the obvious evidence, doesn’t it? Did his nose come out brown after that episode?
The Bigger Picture
There is a granular picture that is manufactured Housing industry specific. Bu there is also a macro picture, that MHProNews – is virtually alone in spotlighting among our industry’s trade media.
It isn’t just manufactured housing that is steadily being monopolized. Other industries are facing this same pattern, although some of the tactics may be distinctive based upon the industry.
It is Buffett’s buddy Bill Gates who said that Warren had learned how to manipulate markets.
It was a Buffett admirer who after reflecting on the evidence of how “the moat” works in practice, came to the conclusion that Buffett was destroying capitalism, not saving it.
No one in their right mind who thinks objectively can seriously believe that with all of Buffett-led Berkshire’s assets and potential synergies, should think that manufactured housing industry couldn’t recover to its 1998 high and beyond if they wanted it to do so.
As pro-industry, pro-consumer, and believer in business-ethics trade media, MHProNews has often said words to this effect. “During an affordable housing crisis, with decades of evidence supporting the value of manufactured housing, the manufactured home industry ought to be soaring to record highs. But instead of soaring, it is snoring. That begs serious questions. It also ought to spark more federal and state investigations post-election than those that already are known to exist prior to the looming 2020 election. The status quo harms taxpayers, investors, millions of residents, tens of millions of renters, plus ethical ‘white hat independents who used to be the core of our once far greater industry. The reason the status quo exists is because certain brands in our industry have arguably hijacked the Manufactured Housing Institute and made it a tool favoring plutocrats and oligarchs operating in our industry whose goal is consolidation. There are no serious challenges by MHI or their advocates to the case made for that claim.” – L. A. “Tony” Kovach.
If someone wants to publicly challenge the prima facie evidence for that argument, let them come forth.
“You mend a thing because you like it;
you end a thing because you don’t.”
– G. K. Chesterton.
With no further adieu that outline and the reports linked above make for a useful overview to pivot to the headlines for reports listed below from the week that was, from 9.27 to 10.4.2020.
What’s New and Recent from Washington, D.C. from MHARR
What’s New on MHLivingNews
What’s New on the Masthead
What’s New on the Daily Business News on MHProNews
A new source has indicated that they have inside information about a Manufactured Housing Institute (MHI) related topic. Stay tuned for more on that topic and much more.
Over two years ago, this writer made the evidence-based observation above. Some balked at that claim, but it has since proven to be spot on, given year over year declines in manufactured housing shipments and production during an affordable housing crisis. That was followed by this almost 2 years ago.
MHProNews has contacted key officials on the Berkshire Hathaway board of directors, to see if they would challenge or refute these claims.
There is always more to read and more to come. Stay tuned with the runaway number one source for authentic “News through the lens of manufactured homes and factory-built housing” © where “We Provide, You Decide.” © ## (Affordable housing, manufactured homes, reports, fact-checks, analysis, and commentary. Third-party images or content are provided under fair use guidelines for media.) (See Related Reports, further below. Text/image boxes often are hot-linked to other reports that can be access by clicking on them.)
By L.A. “Tony” Kovach – for MHProNews.com.
Tony earned a journalism scholarship and earned numerous awards in history and in manufactured housing.
For example, he earned the prestigious Lottinville Award in history from the University of Oklahoma, where he studied history and business management. He’s a managing member and co-founder of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.
This article reflects the LLC’s and/or the writer’s position, and may or may not reflect the views of sponsors or supporters.
Connect on LinkedIn: http://www.linkedin.com/in/latonykovach
The text/image boxes below are linked to other reports, which can be accessed by clicking on them.