MHMSM.com presents Factory Built Housing Industry News at Noon with Erin Patla.
We begin with these stories:
TUESDAY THE OBAMA ADMINISTRATION announced additional support to help homeowners struggling with unemployment through two targeted foreclosure-prevention programs. Through the existing Housing Finance Agency (HFA) Innovation Fund for the Hardest Hit Housing Markets, the U.S. Department of the Treasury will make $2 billion of additional assistance available for HFA programs for homeowners struggling to make their mortgage payments due to unemployment. Additionally, HUD says it will soon launch a complementary $1 billion Emergency Homeowners Loan Program to provide assistance – for up to 24 months – to homeowners who are at risk of foreclosure and have experienced a substantial reduction in income due to involuntary unemployment, underemployment or a medical condition. Under the additional assistance announced, states eligible to receive support have all experienced an unemployment rate at or above the national average over the past 12 months. Each state will use the funds for targeted unemployment programs that provide temporary assistance to eligible homeowners to help them pay their mortgage while they seek re-employment, additional employment or undertake job training. Eighteen states are eligible including California, Nevada, Indiana and Florida.
THE NATIONAL ASSOCIATION OF REALTORS (NAR) reported Wednesday that Second Quarter home prices rose in 100 U.S. cities in the second quarter including 14 with double-digit increases. The national median existing single-family price was $176,900 in the second quarter, up 1.5 percent from $174,200 in the same period of 2009. Lawrence Yun, NAR chief economist, said the correction in home prices appears to have ended in 2009. On a cautionary note, Yun also said prices in some areas remain below replacement construction costs, so even with an elevated supply of existing homes on the market, the realtors don’t expect any consequential movement in home prices for the foreseeable future. Very low inventory of newly-built homes also will help to support home values.
Manufactured Housing in the News…
THE WEEKLY OBSERVER IN JOHNSON CITY, South Carolina ran an editorial Wednesday asking the question: “Is a manufactured home ban necessary?” The City Council there is considering a move to rezone all of the city’s R-3 lots to R-3A to keep any new manufactured homes from being placed within the city limits in those areas. The paper called the move “either one of strategic future planning or a misdirected and poorly conceived initiative to increase the town’s aesthetic appeal.”
The editorial continues: by excluding the homes, the city council is in essence predicting that future residents will be of a certain economic standing, one that can afford site built homes specifically. That is to assume then that future Johnsonville-ites will come to town following a trend of economic growth that would sustain such financial categorization.
The problem is, no solid evidence currently exists that would hint at such a trend. For many families, manufactured housing provides the opportunity to have home ownership without the cost of a site built structure. Whatever the council’s intentions or future plans are, they had better be sure they have a clearly defined goal and do not discourage future residency or tread on the rights of their current citizens.
“Up next, Market News”
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In Market News…
DEER VALLEY CORPORATION this week filed its Form 10-Q for the second quarter of 2010. The Company reported revenue for the 2nd quarter of $9,192,251, a 37.1 percent increase over the revenue reported in 2nd quarter of 2009 and a 50 percent increase over the revenue reported for the 1st quarter or 2010. In a year-over-year comparison, net earnings for the second quarter tripled to $603,054 vs. $198,136 reported for the 2nd quarter of 2009. Deer Valley’s CEO, Charles G. Masters, comments that a portion of the gain in the second quarter of 2010 undoubtedly reflected the effect of the temporary government-sponsored tax credit program. Of more long-term importance, he says, has been the increasing effect of the Company’s ability to provide qualified independent dealers with a reliable source of inventory financing. “We believe that with the availability of our ‘financing arm,’ we are gradually gaining in the constant competitive battle for industry position.” Masters added this caution, “The entire manufactured housing industry continues to be battered by the lingering effects of the national economic slowdown. We can anticipate that with the continuing national economic lethargy, the slower housing sales activity that is normally experienced by the construction market during the winter months will very probably be exaggerated in the quarters ahead. We believe Deer Valley has the financial strength to deal with these market conditions, but our goal of returning to our historical growth rate will probably remain elusive throughout 2010 and early 2011.”
STOCKS WERE AWASH IN RED on Wednesday, erasing gains for the year, on indications there could be significant roadblocks on the highway to economic recovery. A report showed the trade deficit had widened in June, much more than economists had projected. The drop also follows an assessment by the Federal Reserve Tuesday that gave a cautious outlook to the recovery and would begin buying Treasury securities, a move some analysts say is a measure of last resort. Most of the stocks on our watchlist were down Wednesday with Skyline and Cavco both falling more than five percent. The manufactured housing composite value was also off five percent. Up for the day was Nobility Homes and All American Group which went up 10 percent to close at 44 cents a share. The Dow closed down 265 points to 10,378.
“On behalf of Production and IT Manager Bob Stovall, Editor L.A. ‘Tony’ Kovach, Associate Editor Catherine Frenzel, INdustry in Focus reporter Eric Miller, and the entire MHMSM.com writing and support team, this is Erin Patla. G’day!”