Yesterday, in part one of this series on the “Woodstock for Capitalists,” the Daily Business News focused on several aspects of the business, wit, insights, and politics of Warren Buffett.
Today, we look at Kevin Clayton of Clayton Homes, who even before his featured interview on FOX Business, Warren Buffett spoke highly of Clayton Homes in his annual letter to shareholders on February 25th.
“Clayton and Berkshire have been a wonderful partnership,” wrote Buffett.
“Kevin Clayton came to us with a best-in-class management group and culture. Berkshire, in turn, provided unmatched staying power when the manufactured home industry fell apart during the Great Recession.”
The Knoxville News-Sentinel also reported that, for the second year in a row, Buffett defended Clayton’s financing practices.
In 2015, a joint Seattle Times, Center for Public Integrity and later BuzzFeed News investigation accused Clayton Homes of pushing minorities and others into high-interest predatory loans, which Clayton has strongly denied. The Daily Business News covered that story extensively, separating agenda media hyperbole, faked news fiction from the facts. One of those stories is linked here.
In his interview with FOX Business’ Liz Claman, Clayton highlighted the fact that they expect to sell in excess of 45,000 manufactured homes this year, doing their part to address the affordable housing crisis in the U.S.
“The average new home in America is almost $400,000 now,” said Clayton.
Pointing to their display home, Clayton spoke directly to an ongoing challenge for the industry that needs to be addressed.
“What our industry is saying, if that it’s built with the steep-pitch roof, onsite garage, and porch, built to the federal code and to FHA setup standards, it should be financed and zoned just like site-built traditional housing.”
Clayton also shared details on the company’s new “tiny homes,” designed by Mountain Brook, Alabama-based Jeffrey Dungan Architects.
“We’ve been working for two years to develop the best tiny homes,” said Clayton.
“What’s unique about us, is this home is built to live in permanently and meets your local and state housing codes, which is a huge advantage.”
Among the points absent from the discussion was the Manufactured Housing Improvement Act of 2000 (MHIA), enhanced preemption, and the examples that HUD themselves provided of municipal placement in a university level report, linked here.
Tiny House – Risks, Trends, and Rewards?
The tiny house move by the giant is not a guaranteed lock, as those who recall the Clayton i-House recall the fanfare, which fizzled as a result of all-too-modest sales. So industry observers are watching this move carefully.
As our regular readers are aware, MHProNews and MHLivingNews have covered the “tiny home” movement extensively, including the potential for big legal trouble for owners and a detailed side-by-side comparison with manufactured homes, highlighting function and value versus fashion.
Clayton Homes is reassuring their prospects for their tiny house that their units are built to a building code, unlike so many on the market that are built to no codes at all.
Others in HUD Code manufactured housing are making their own moves on tiny houses. Some are built to the HUD Code, some to the ANSI code, and others reportedly to no codes, but still rolling out of HUD Code production centers. The tiny house craze is no doubt fueled by the mainstream media’s love affair with the typically mobile units, while at the same time slighting manufactured homes.
About Clayton Homes
Clayton Homes is the largest producer of manufactured homes (MH) in North America and as noted is a subsidiary of Warren Buffett’s Berkshire Hathaway.
Vertically integrated, the company has several hundred retail centers nationwide, HUD Code and modular production centers. Through its affiliates and family of brands, Clayton builds, sells, finances, leases and insures Clayton-built manufactured and modular homes. Their retail operation famously also buys products and uses services from other producers.
For the most recent closing numbers on all Berkshire Hathaway – and all MH industry-connected tracked stocks – please click here.
(Image credits are as shown above, and when provided by third parties, are shared under fair use guidelines.)
Submitted by RC Williams to the Daily Business News for MHProNews.