Posted on February 1, 2008

A few days ago I wrote about how Freddie Mac plans to make policy changes that should effectively serve to raise the cost of borrowing for many manufactured housing customers. To the extent that this will hinder growth in manufactured housing, it is a bad story. Nonetheless, there is also some good policy news for the manufactured housing industry coming out of Washington.

That good news would be the FHA Manufactured Housing Loan Modernization Act (HR 2139). This bill, which has passed the House, would potentially increase loan limits on Title I loans from $48,600 to $69,678. In subsequent years, the limits would increase

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Posted on January 31, 2008

Larry Keener, President of Palm Harbor Homes, made the following comments during the investor's call for the third quarter of 2007 on January 22, 2008. PHHM's third quarter concluded Dec. 31st, 2007.

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Posted on January 30, 2008

You may have heard that Federal Reserve lowered interest rates again today. Today's 50 basis point drop is the second rate decrease in just two weeks. Both were more than just a quarter percentage point, two. This is a substantial change in the lending environment.

For most borrowers, that is going to mean that the mortgages that they apply for in the next few months will cost less. 125 basis points represents tens of thousands of dollars over the lifetime of a 30 year mortgage. On a $100,000 home, such a drop represents $104 off the first month's payment.

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Posted on January 29, 2008

A few days ago I spent some time pouring over the Residential Finance Survey. Its a great document. I am going to return to it today.

Some things that strike me as interesting, within the pages of this report:

  • More mobile homes are sold used, in every region in the country, than are sold as "new." This explains the relatively low mean and median sales prices contained elsewhere within the RFS. It also refutes the argument that these properties cease to have value after they leave the lot. Yes, they may decline in value some, but people still are willing to pay for the chance to live in them. A used mobile home is still a home.
  • Homes in the South are the ones most likely to undergo capital improvements. This discrepancy between the South and other regions is so high that it makes me want to question how the numbers were calculated.  It just cannot be this distinct.  There must be some explanation.
  • The rate of capital improvements in the South may be interrelated to the high rate of resale activity in the South. More homes are sold in the South than in any other region. It might also be that homes in the South skew to the lower end of the value
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Posted on January 28, 2008

The Census Department has numbers for shipments and placements of manufactured homes in the United States in 2006.  There are preliminary data for the first 11 months of 2007.  The numbers show that the crisis within the industry has not lifted.

In all, 117,300 homes were shipped in 2006. This was a drop off from 2005, when the industry moved 146,800 homes. It was not as much as in 2004, either, when 130,700 homes were shipped.

For 2007, 89,900 units were shipped in the first 11 months of the year.  December is not traditionally a barn burner of a year.  This means that there is a distinct possibility that fewer than 100,000 units will be shipped in 2007.  That would be the lowest number since shipments were first tracked back beginning in 1959.

The numbers include seasonal expectations. The suggestion is that summer and early fall should be a time of peak sale. That was part of the problem. While shipments were fairly high for low-volume periods in the winter months of early 2006, shipments fell far below expectations in the latter months of the fall. In particular, October appears to have been a bad month.

Some time has passed. I wonder how changes in the macro environment of our economy will influence these numbers. At the time, hybrid mortgages were making it possible for a lot of people to get convenient low-cost financing on single-family site built homes. Those

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Posted on January 25, 2008

Today I want to write about the median sale price of mobile homes, about the number of distress sales, and about the number of homes that are still sold that were built prior to the onset of the HUD code.

To do that, I am going to rely upon some Census data.  The Census Bureau's Residential Finance Survey is a great find.

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Posted on January 25, 2008

A lot of people want to know how many people live in manufactured homes. I think it is because there is a sense that the figure is large, but also not known. In many communities, parks are located in out-of-the-way places. In North Carolina, about one-in-six families lives in manufactured housing. Yet here in Durham, it is unusual to see even one mobile home during the course of daily life. The parks are there, just on the outskirts of town. I have a friend who lives in some remote land north of Chapel Hill. There are two parks, straddling a highway overpass, near his home.

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"I Feel Like I was Set Up to Fail: Inside a For-Profit College Nightmare."

This story was published in Salon Magazine on January 27th, 2014. In March, Senator Richard Durbin cited this story when speaking on behalf of his bill, The Student Loan Borrowers Bill of Rights.

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