Top National News
FHA Is Back in the Black — But Not Out of the Woods
The Federal Housing Administration (FHA) has notified Capitol Hill lawmakers that it has shored up its finances and will not need to go to the American taxpayers for additional assistance. According to housing officials, the agency had nearly $40 billion on hand as of the end of the third quarter, including $4.8 billion in cash reserves. However, it is not completely out of jeopardy. By law, the FHA is required to maintain a cash cushion equivalent to 2 percent of all the loans backed by the agency. The $4.8 billion cushion announced Monday to Congress equals only 0.41 percent. The FHA has not reached the required 2 percent level since 2009, and a recent audit projects that it will not hit that target until 2016.
From “FHA Is Back in the Black — But Not Out of the Woods”
Washington Post (11/18/14) P. A15 ElBoghdady, Dina
HUD Secretary Says Housing Finance Reform Remains a Top Priority for the Obama Administration
In a Nov. 17th interview with Bloomberg Television, HUD Secretary Julian Castro said the Obama administration will continue to work for the remainder of its term on a revamp of the U.S. mortgage finance system. “Introducing more private capital into the market and taking the taxpayers off the hook if we ever do experience what we just went through as part of the housing crisis in 2007, 2008, 2009, that is a priority [for] this administration and for HUD,” he declared. Castro recommended that the next Congress consider legislation to phase out Fannie Mae and Freddie Mac. Although two Senate bills won committee approval in the spring, little more has been done on this front since then. “This could be, I believe, a good victory either in the lame-duck session or, more realistically, perhaps in the next term of Congress where there is bipartisan support for housing finance reform, for doing away with Fannie and Freddie as we’ve known them, creating a backstop,” the HUD official stated.
From “HUD Secretary Says Housing Finance Reform Remains a Top Priority for the Obama Administration”
The Hill (11/17/14) Needham, Vicki
Home Affordability Fell Slightly in the Third Quarter
The median U.S. home price jumped to $221,000 in the third quarter, which the National Association of Home Builders said drove housing affordability down a bit. Based on the NAHB/Wells Fargo Housing Opportunity Index, 61.8 percent of new and resale properties were within financial reach of households earning the national median income of $63,900. The reading is down from 62.6 percent for the second quarter, but NAHB chief economist David Crowe projects that affordability will improve again in 2015 as a result of increased employment and wages, continued favorable interest rates, and built-up demand. The most affordable major housing market for the third quarter was Youngstown-Warren-Boardman, OH-PA, which was joined by Syracuse, NY; Indianapolis-Carmel, IN; Harrisburg-Carlisle, PA; and Dayton, OH. The least affordable major housing markets in the nation, led by San Francisco-San Mateo-Redwood City, were clustered in California, with New York-White Plains-Wayne, NY-NJ, rounding out the top five.
From “Home Affordability Fell Slightly in the Third Quarter”
The Hill (11/13/14) Needham, Vicki
Housing, Construction Advocates Score in Midterms
Pro-housing groups such as the National Association of Realtors and the National Association of Home Builders counted many victories in the recent mid-term elections. Eleven of 13 U.S. House and Senate candidates backed by NAR won their races, and 77 percent of the so-called Realtor Party’s candidates were successful in local and state contests. NAR made more than $10 million in independent expenditures in this election cycle — mostly in support of Republican incumbents — up from $3.6 million in 2012. Continued home buyer access to the mortgage interest deduction and to FHA-backed mortgages are key issues for the organization. At this time, NAR also opposes a shutdown of Fannie Mae and Freddie Mac. NAHB — which forked out more than $2.4 million to support 371 candidates running for the House and Senate — sees housing finance reform, credit availability, construction labor shortage and regulatory policies as hot-button issues.
From “Housing, Construction Advocates Score in Midterms”
Construction Dive (11/10/14) O’Malley, Sharon
Modular Bradenton Senior Care Facility Could Be Model for Industry in U.S.
Champion Homes produced the 40 or so modular units that were stacked together to create Comfort Cove Senior Care in Bradenton, FL, which is in the finishing stages. The project is hailed by developer BSV Holdings as the first facility of its kind in the nation and a potential model for quickly meeting the needs of a graying population. The estimated start-to-finish time for Comfort Cove is about seven months, at least two months ahead of the timetable for a comparable stick-built facility. “If you need a project built in a timely fashion, why wouldn’t you use modular?” asks BSV Chairman Brent Crego, who expects the 28-bed elder care home to be completely full by the middle of next year. He notes that the company’s approach will prove popular due not only to the abbreviated construction schedule but also the build quality and the ability to re-scale the size of the project as needed. BSV has plans to build more than a dozen modular senior care facilities across Florida. It will own and operate the properties but also will offer a “turnkey” version for sale to other investors.
From “Modular Bradenton Senior Care Facility Could Be Model for Industry in U.S.”
Bradenton Herald (FL) (11/15/14) Johnson, Matt M.
Manufactured Housing Donations Kickstart Hall Debt Elimination Effort
With Clayton Homes President and CEO Kevin Clayton leading the charge, manufactured housing industry insiders are digging into their own pockets in an effort to help the RV/MH Hall of Fame eliminate $2.4 million in debt. In a nod to Clayton’s annual commitment of $40,000 for five years, the fundraising campaign is flying under the banner of the Kevin Clayton Debt Elimination Program. Other big contributors so far include Cavco Industries’ Joe Stegmayer and Gary McDaniel of YES! Communities. “We want to encourage other people in manufactured housing to step up and add their support to the debt elimination plan,” said Hall of Fame President Darryl Searer. Once the Hall of Fame has wiped out its debt, it can break ground on a planned 5,000-square-foot manufactured housing museum just east of the facility, similar to the existing recreational vehicle museum already contained within the building.
From “Manufactured Housing Donations Kickstart Hall Debt Elimination Effort”
Elkhart Truth Online (11/10/14) Parrott, Jeff
3 Phoenix Businesses Make ‘Forbes’ Best Small Companies List
Cavco Industries, a maker of factory-built homes, was included in Forbes magazine’s recent compilation of “America’s Best Small Companies 2014.” The Phoenix-based company ranked high on the list, coming in at No. 13. It earned $539 million for the 12 months ended Oct. 1 and has increased its earnings per share by 88 percent over the last five years.
From “3 Phoenix Businesses Make ‘Forbes’ Best Small Companies List”
Phoenix Business Journal (11/10/14) Brown, Brandon
Carefree Communities Becomes the Nation’s Fifth Largest Manufactured Home and RV Community Owner With Acquisition of Vedder Communities in California
Carefree Communities Inc. is now the fifth-biggest owner of manufactured home and RV parks in the country, as a result of its recent purchase of Vedder Communities. The addition of Vedder’s 18 properties with 4,530 home sites in California increases Carefree’s holdings to 101 communities and more than 27,000 sites across North America. “The Vedder portfolio is widely considered to be the best privately owned manufactured home community portfolio in California and one of the best in the country,” said David Napp, CEO of Scottsdale, Ariz.-based Carefree. “This is an important strategic acquisition for Carefree, as we look to continue to grow our company in highly sought after retirement and vacation destinations in coastal markets.” Three of the Vedder assets have earned Community of the Year recognition from the Manufactured Housing Institute.
From “Carefree Communities Becomes the Nation’s Fifth Largest Manufactured Home and RV Community Owner With Acquisition of Vedder Communities in California”
IT Business Net (11/10/14)
Oil and Gas Industry Helps Drive Increasing Housing Demands
Wisdom Homes of America is stepping up to meet the growing demand for housing in Tyler, Texas, whose population expands by more than 3,000 residents annually. The city has benefited from the booming oil and gas industry, which has prompted many workers to relocate to the area with their employers. While man-camps have popped up previously as a solution for the high housing demand, Wisdom Homes is offering an alternative. Its latest project involves 15 homes on a 12-acre lot in Tyler — the latest development under its plan to bring 200 houses to East Texas by next year. According to Wisdom Homes President Brent Nelms, the company’s homes are about 1,200 to 2,600 square feet in size and run between $40,000 and $100,000 in price.
From “Oil and Gas Industry Helps Drive Increasing Housing Demands”
KETK NBC (Texas) (11/03/14) Chapman, Kristen
Cavco Industries (CVCO) Announces Quarterly Earnings Results, Meets Expectations
Manufactured home builder Cavco Industries posted its latest quarterly financial results, which met or exceeded consensus estimates. With $139.30 million in revenue for the three months, the company outperformed projections of $136.40 million. It also reported quarterly earnings per share (EPS) of $0.61, topping EPS of $0.50 a year earlier and matching the current estimate.
From “Cavco Industries (CVCO) Announces Quarterly Earnings Results, Meets Expectations”
WKRB-TV (10/30/14) Barnet, Seth
Equity LifeStyle Beats Analysts Estimates
Equity LifeStyle Properties, an owner of manufactured home communities, posted better-than-anticipated financial results for its third quarter. The Chicago firm reported $63.1 million, or 69 cents a share, in funds from operations, topping analysts’ expectations of 66 cents per share.
From “Equity LifeStyle Beats Analysts Estimates”
Chicago Business (10/21/2014)
California Investor Buys Tulsa-Area Manufactured Home Community
California-based Park Street Partners has acquired its third manufactured home community in Oklahoma. Founding partner Jefferson Lilly said Park Street will change the name of the property to Tulsa Estates and fill its vacant pads with about 20 newer homes. “Our goal is to help deserving families get out of the game of paying rent forever in apartments, and into affordable housing they’ll actually own,” he remarked, noting that a three-bedroom manufactured home in Tulsa Estates will rent-to-own for just $600 per month compared to $844 per month for a typical three-bedroom apartment locally. Park Street Partners, a private equity firm, already owns Noble Estates in Slaughterville and Tuttle Estates in Tuttle, and it also has a fourth property under contract.
From “California Investor Buys Tulsa-Area Manufactured Home Community”