A presentation by former Manufactured Housing Institute (MHI) Vice President Jason Boehlert has surfaced. Boehlert left MHI and was replaced by Lesli Gooch, who later became MHI’s CEO. Boehlert’s power-point pitch-deck slides shared data from MHI that perhaps inadvertently, but nevertheless clearly, revealed just how badly the industry’s manufactured home industry’s independents have been harmed since the dawn of the Berkshire era in manufactured housing.
It is through the lens of history that Boehlert’s claims and points arguably illustrate years of treacherous failures by the Arlington, VA based trade group that Boehlert left.
The MHI presentation also illustrates how the regime that supplanted him and prior MHI President and CEO Chris Stinebert talked an interesting talk. But hindsight now reveals just lacking in actual performance for literally over ten thousand manufactured home independents that have vanished in the Berkshire era. Those now extinct independent street retailers, and dozens of the HUD Code manufactured home producers that served them, includes sizable numbers that were successful for a decade or more they were apparently lost to the Buffett-moat methodology.
Boehlert’s pitch for MHI provides sobering evidence that merits state and federal investigations. From his presentation below are these claims that MHI stated as facts at that time (2012).
- 45 corporations producing manufactured homes – vs. today – MHI’s website says that there are 33 (note, not untypically, they have conflicting claims, but 33 is from an apparently recent document).
- Boehlert said there were 122 home building facilities in 2012 vs. 263 in 2001. Today, a recent MHI document says there are 136 plants. Another MHI download stated that in 1998, there were 330 producing HUD Code home builders. So, 194 factories have been lost, the bulk of which occurred during the Berkshire era. That represents thousands of lost jobs.
- Boehlert’s says in 2012 there were 2,000+ home sales centers. The estimates of the total number of manufactured housing “street retailers” in the late 1990s was around 20,000. Today, the number is obscured, perhaps because some believe it to be around 1200 (+/-), including corporate owned locations. MHI’s latest download on that provides no estimated number of street retailers at all. But publicly traded Cavco Industries (CVCO), an MHI member, has oddly said that there are 4,000 retailers – a figure that sources suggest include communities that are buying manufactured homes, and are not just ‘street retailers.’ Either way, the fallout has been dramatic — well over 15,000 lost retailers. That is a lot of lost distribution points. In 1998, those roughly 20,000 street retailers were providing about 4 times the current number of affordable manufactured homes to the areas that those mostly defunct retailers once served.
- 50,000 land-lease communities. Today, MHI’s document says that estimated number is “43,000+.” Cavco claims to its current and potential investors that the number is 40,000, which many informed sources think is too low. It is worth mentioning that MHI member Sun Communities (SUI) Chairman and CEO Gary Shiffman recently noted the lack of accurate information in an earnings call. Other sources place the estimate at about 45,000 land lease communities. These conflicting points underscore Shiffman’s statement, cited above. But they also each point to significant numbers of lost communities. Those total numbers of lost communities would be in the thousands. The now closed communities dwarf the numbers of those that have opened, which MHI member DataComp said is 310. That is a lot of lost affordable housing.
- (REITs) • ELS, UMH, SUN (Note: MHI should have said SUI not SUN). A new REIT has since emerged, Flagship Communities. Note only have thousands of land-lease communities been lost due to closures, but significant numbers have been and are being ‘consolidated.’ Those consolidations are often by MHI member firms. See the report on RHP Properties the names other MHI member firms linked here.
- 14.5% of all new single-family housing sold in 2011. While the total numbers of homes produced have risen since 2012, the market share of manufactured housing has declined, per MHI, corporate, and federal data.
Summing up, much of the data in the Boehlert’s MHI presentation to the Housing Assistance Council now provides previously obscured insights into just how badly industry independents have been harmed. Those lost firms have ripple effects. Here is the full MHI slide deck as presented to the Housing Assistance Council.
The text below is from the MHI presentation’s post.
Manufactured homes have been an important source of housing in the United States for more than a half century. As this unique form of housing continues to evolve, so does its delivery into rural markets. Over the past decade there has been a concerted effort by several entities to develop a manufactured housing “done right” model. National organizations, philanthropic foundations, and community-based nonprofits are rethinking the way manufactured homes are built, sold, financed, and placed. What progress has been made as a result of this initiative, and what are the continued challenges with manufactured housing in rural America? The session will include a discussion on the state of the manufactured housing industry, finance markets, nonprofit development, park preservation, resident rights, legislative initiatives, and regulatory developments for manufactured housing.
Additionally, here are the bulk of his bullets.
1. Manufactured Housing: An Industry Overview Housing Assistance Council National Rural Housing Conference Washington, DC Jason Boehlert Manufactured Housing Institute December 6, 2012
2. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Manufactured housing critical to housing market and American economy• What is Manufactured Housing• Economic Contribution• The Market we Serve• Historical Industry Trends• Industry Outlook• Policy Areas of Interest
3. Manufactured Housing: America’s Sustainable and Reliable Housing Solution What is Manufactured Housing• Homes built in a factory to the Federal Manufactured Home Construction & Safety Standards (the “HUD Code”)• The HUD Code is the only federally- regulated residential building code• Distinctive business model: Homes built indoors in a climate controlled setting, sold through a retail network, finished at the site by installation professionals
4. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Advantages in Quality and Cost• Precision Built • Homes are tighter, stronger, and built with greater dimensional accuracy than site-built homes• Quality • QC oversight is continuous, with three layers of oversight nationally administered by HUD• Efficient Use of Skills/Resources • High Volume, skills integrated production and volume materials purchasing• Green • Optimal material use, minimal waste and recycling makes factory building inherently green
5. MH SHIPMENTS 1959 – 2011
6. The Perception
7. The Reality Newport Beach, California
8. Raleigh, North Carolina
9. Chantilly, Virginia
10. Tampa, Florida
11. Grayslake, Illinois
12. Germantown, Wisconsin
13. Tucson, Arizona
14. Mobile, Alabama
15. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Economic Profile • 45 corporations • BRK, CVCO, SKY • 69 in 2001 • 122 home building facilities • 263 in 2001 • 2,000+ home sales centers • 50,000 land-lease communities (REITs) • ELS, UMH, SUN • 51,606 homes built in 2011 • 14.5% of all new single-family housing sold in 2011 • Approximately 60,000 full-time U.S. based employees • 200,000 jobs over the past decade Source: U.S. Census, IBTS, MHI
16. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Serving a Vital Market• 2011: Manufactured housing accounted for • 27% of all new homes sold under $200,000 • 47% of all new homes sold under $150,000 • 72% of all new homes sold under $125,000• 2 of every 3 manufactured homes are in rural areas Source: MHI, U.S. Census
17. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Serving a Vital Market• Best Value Proposition • Average Price Without Land • Manufactured Home – $60,600 or $41.22 per SF • Site-Built Home – $207,950 or $83.38 per SF• Homes Placed Anywhere • 70-75 percent on private property • 25-30 percent in residential land-lease communities • Roughly 2/3 in rural communities
18. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Serving a Vital Market All Home Owners MH Owners $70,000 $60,000 $60,000 $50,000 $40,000 $32,000 $30,000 $20,000 $10,000 $0 73% of manufactured home households earn less than $50,000 Source: U.S. Census, American Housing Survey
19. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Historical Trends • 8.7 million households with 22 million people live in manufactured homes (6.7% of nation’s housing stock/9% of single family housing stock) • Since 2000: Manufactured housing has accounted for roughly 10% of all new single family homes starts • 2002- 2005: Market imbalance due to subprime activity in site-built market Source: U.S. Census, American Housing Survey, MHI
20. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Historical Trends• New single family site-built homes sold in the US has declined by 76% since its peak in 2005• New manufactured homes sold in the US has declined by 57%Source: U.S. Census
21. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Industry Outlook Positive• Manufactured housing is back on the rise over the past two years, since bottom in 2009. Currently at 80% of 2011 sales and 13% increase in sales through Q3 of 2011• 2011: Manufactured housing accounted for 14.5% of all new single family homes sold Source: U.S. Census, MHI
22. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Industry Outlook Positive• Industry is responding to current housing market demands and stresses• Rapid growth in population over next decade looking to maximize housing value proposition• Changing demand of baby boomers and millenials• As demand for our homes grows, more U.S. jobs created
23. Manufactured Housing: America’s Sustainable and Reliable Housing Solution Policy Areas of Interest• Energy Efficiency• Tax Issues• Dodd-Frank/SAFE Act Implementation• GSE Reform• HUD/FHA
24. Manufactured Housing: America’s Sustainable and Reliable Housing Solution…
25. Manufactured Housing: America’s Sustainable and Reliable Housing Solution “If home buyers throughout the country had behaved like our [manufactured] buyers, America would not have had the crisis that it did.” “The government wants high quality, low cost housing and manufactured housing provides that product.” – Warren Buffett.
Additional Information, More MHProNews Analysis and Commentary
As a presentation, it is fine. But what this MHI presentation reflects – in hindsight and based upon data and trends – is that consolidation of the industry accelerated during the Berkshire-Hathaway era.
The slides in the MHI pitch-deck above of upscale manufactured homes are a reminder of the point that ‘residential’ style manufactured homes long-predated MHI’s demonstrably unsuccessful CrossModTM scheme. Note the phrasing of Buffett ally Bill Gates. He called the Buffett method “almost parasitic.” A parasite feeds off its host. The CDC defines a parasite like this: “A parasite is an organism that lives on or in a host organism and gets its food from or at the expense of its host” (emphasis added). Note that all of these points are the truth hiding in plain sight. Yes, it takes time to gather such facts. But once the facts are laid out and comparisons are made, they paint a picture that is darkly revealed in this penetrating Gates quote.
The case could be made that much of that consolidation was accelerated by the purportedly “felony” antitrust and RICO (Racketeer Influenced and Corrupt Organizations Act) violating practices that are in evidence, per Samuel “Sam” Strommen’s seminal report to Knudson Law.
Facts are what they are, and they are sobering to those who believe in free enterprise, the rule of law, and the American Dream.
See the additional linked information to learn more. Because the evidence reflects several troubling points. Borrowing a phrase from Robert F. Kennedy Jr., J.D., is that the regulators of our industry are arguably “sock-puppets” that have stood by and watched this treachery occur.
Our thanks to you, our sources, and sponsors for making and keeping us 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.