Buying into the manufactured housing industry today is like buying a stock that is significantly undervalued.
That’s what many believe. Count the Masthead’s industry veteran’s author among them. Buying into manufactured housing now is like buying a stock that is significantly undervalued, and is potentially poised for serious growth.
The odds are good to great that everyone reading this has:
- an interest in manufactured housing, and
- believes manufactured homes could play an important part of the solution for America’s growing affordable housing crisis.
We believe that too.
Those in the industry, investors, media, public officials, advocates, and researchers all have viewpoints, and many have questions.
While it would take time to ramp up to 500,000 or 1 million new manufactured homes a year, it’s doable with the correct resources, plus the kind of long-term commitment that Warren Buffett’s Berkshire Hathaway brands – along with other success stories in the industry – have achieved.
With savvy millionaire and billionaire believers in the HUD Code regulated manufactured home industry, why is the industry seriously underperforming?
That’s a question that the Urban Institute posed in a new report. With four co-authors, the report makes some interesting, questionable and meh points. It arguably failed to address several important points.
But what the Urban Institute (UI) obviously failed to do was hide apparent conflicts of interest, which went undisclosed in their reporting.
One of those conflicts is ‘hiding in plain sight.’
Warren Buffett, “Lifetime Trustee” of the Urban Institute (UI)
They could claim at UI that the disclosure exists on their website, because Warren Buffett is listed as a Lifetime Trustee of the Urban Institute.
Buffett’s given billions to the Bill and Melinda Gates Foundation, which has paid millions to the Urban Institute. That’s how, says Open Secrets, so-called “Dark Money” flows.
While that dark money is often noted for political uses, it can clearly be used for research that in turn influences media, politics, business, advocacy, public officials, investments, and more.
So when four different co-authors at Urban Institute delve into a topic that so directly involves an interested party, one would think that one or more of those four would want to disclose that in their report itself, or as a footnote? That’s what non-profit researchers are supposed to do.
Instead of disclosure, instead of full transparency, the opposite occurred with UI and their report.
According to sources who claim knowledge about the research at the Urban Institute, the report writers’ promised anonymity to an association and corporate interests who ‘vetted’ their research report.
Pardon me?
A manufactured home, built by Clayton Homes, is the report’s featured image. What were they thinking at UI?
And doesn’t that make their research at least appear to be at COI, and not much more than a higher class of one of MHI’s controversial paid advertorials?
Conflicts of Interest – COI
According to the facts presented, and uncovered to date, it implies the report has Berkshire Hathaway, Clayton Homes, 21st Mortgage, and the Manufactured Housing Institute’s finger prints all over it.
See the flash Daily Business News initial report, linked below.
“Follow the Money” – Controversial Urban Institute Report on Manufactured Housing
One need not be an attorney, journalist, or researcher to realize that it all smells of conflicts of interest. While this writer isn’t an attorney, one concurred with our assessment. As with all of our reports, fisking, fact-checks, commentary and analysis, we encourage readers to do their own homework, and see for themselves.
That said, why where those apparent conflicts of interest not disclosed?
Begging the Questions…
That clear lack of transparency begs several questions.
- Why not disclose their respective interests and involvements?
- Who benefits from the UI report on manufactured housing?
- What does the report steer people to look at, as they ponder the manufactured housing industry?
- What does the report steer people away from looking at, as they research manufactured housing as an important solution for the affordable housing crisis? (Note: HUD is one of the sources for revenue to UI. We believe editorially that the Trump Administration and HUD Secretary, Dr. Ben Carson, ought to suspend all such payments throughout the federal government, until the dark money ties and conflicts of interest that are working against the public’s and small businesses are all cleared up.)
Non-Profits, Foundations and Manufactured Housing
When the topic of philanthropy was raised in the Kevin Clayton interview video, Kevin himself points to foundations and non-profits that they believe will be important for them.
Clayton’s video interview also points specifically at using manufactured housing as urban infill.
Research is often done by nonprofit organizations.
Reports they create are in turn routinely picked up by media, educators, policy advocates, investors, and government.
When investors with a long-term horizon, as Buffett has, third party research is part of what they study. Kevin says so, in his own words, in the video. Kevin also speaks about Buffett’s connections and sources of information.
Kevin Clayton Interview-Warren Buffett’s Berkshire Hathaway, Clayton Homes CEO
The Kevin Clayton Interview Video is a Road Map in Numerous Ways
The video laces together in Kevin’s own words the concerns and allegations over:
- monopolistic practices,
- how vital credit is to the industry,
- how nonprofits and foundations are important and are part of their plan.
It’s the truth hiding in plain sight.
The Manufactured Housing Institute is a non-profit.
NextStep, is at least in part, a non-profit.
So too the RV MH Hall of Fame, and the state associations which Clayton and 21st or other Berkshire Hathaway brands belong to as well.
The Clayton video interview explains why with sufficient capital, the affordable housing solution indeed ought to include a heavy dose of manufactured homes.
When a non-Berkshire Hathaway, non-MHARR company CEO told MHProNews in Louisville last month that MHI’s work for many years “has made no sense,” that’s true from the vantage point of a non-Berkshire Hathaway brand, or from someone who isn’t part of their insider circle.
Manufactured Housing Institute VP Revealed Important Truths on MHI’s Lobbying, Agenda
MHI board members have during the Richard “Dick” Jennison era complained to MHProNews that that the Arlington, VA based trade group has become a “secret society,” or an “exclusive club” that only a handful actually have any say in governance.
If these points, concerns, and allegations prove true, that’s problematic for the industry, and MHI members, on several levels.
Frank Rolfe: Pressured into Silence? Manufactured Housing Industry, and Journalism
We will boil it down to its essence.
We already noted on the Daily Business News that there are two great laws that manufactured housing benefits from.
Understanding these 2 existing federal laws, and having them fully implemented, would be major advances for public officials, those needing affordable housing, housing professionals, and investors.
McCrory Lawsuit – “Significant Victory Against Zoning Discrimination” – Manufactured Homes
Note that preemption was ignored in the Urban Institute report. Why?
We’ve noted that MHARR has raised concerns over the new class of manufactured housing that Clayton dominated MHI is pushing.
Sources at MHI and with Clayton homes told MHProNews that MHI’s public relations person has spent time at Clayton location(s). On MHI’s dime? How is that fair to the association’s smaller members?
The videos that MHI produced benefit Next Step, a nonprofit that Clayton and MHI are both supporting.
Next Step is also part of the Duty to Serve (DTS) chattel (personal property, Home only lending) financing trials mandated by the 2008 Housing and Recovery Act (HERA). Do you see the pattern of non-profits being used by Clayton, Berkshire, et al?
Manufactured housing already has enhanced preemption under the law. Why bother with a new class of home?
Harper – Thank You Rev Donald Tye, Fighting for Enhanced Preemption of Manufactured Homes
People still incorrectly call a manufactured home a mobile home, even though no mobile homes have been built for over 41 years. Will a name change work, without education of the public on what manufactured homes are, versus the widespread image of them? Isn’t it all just shadow boxing? Making the industry think they are doing something, when they are buying time for more consolidation to take place?
Manipulated
The vast majority of the people I’ve met with a Berkshire Hathaway brand, or who are MHI members, are good folks. We have connections with dozens of them. Some are sources for MHProNews.
We have not at any time slammed the quality of Clayton’s products. The vast majority of the folks I’ve met and know from Clayton, 21st, et all are fine people.
Our focus has been and will remain, what holds manufactured housing back?
It’s the same question that the Urban Institute asked.
Berkshire Hathaway, directly and indirectly through political, regulatory, capital, nonprofits, et al has manipulated and allowed to be depressed the market for manufactured housing. They are doing so in ways that appear to be monopolistic.
Kevin Clayton has in his own words, dotted those i’s and crossed the t’s, about Buffett hating competition, and instructing the building of “the Moat.”
So too has Warren Buffett.
We believe that there is plenty of evidence that the report from an award-winning MHI member to MHProNews was true when he said (paraphrasing), that ‘the big boys have figured out how to get the smaller companies to pay for what the big companies want.’ See that, linked here.
We also believe the pattern is there to support the claims of those past and present MHI members – along with others – who have told MHProNews how they personally have suffered from the monopolistic and other business practices of Clayton Homes, 21st Mortgage, et al.
Recommendations?
The industry’s post-production sector should forge a new trade association, as several have already advocated and are exploring.
There needs to be civil, administrative, and criminal inquiries made into these allegations involving MHI and Berkshire Hathaway, et al.
When Buffett, Jeff Bezos, and Jaime Dimon’s announcement earlier this week caused the markets to plunge, it is in the view of some analysts a warning shot across the bow of the Trump Administration.
Buffett, Bezos – Time Announcement to Drop Market Ahead of SOTU? Plus MH Market Update$
If so, that warning shot impacted investors. No one should be above the law.
Arguably the most harmed are the mom-and-pop retailers and communities, along with any independently owned producer, supplier, or financial services company involved in manufactured housing.
Buffett became the biggest player in manufactured housing in 2003 with his first acquisitions.
Since the Kevin Clayton video interview was originally conducted, Clayton’s footprint in the industry doubled. He did so using “the Moat,” financing, nonprofits, and other tools Kevin expresses in his own words. Several of those are the topic of related reports, linked above and below as references.
There are reasons why Dick Jennison and Rick Robinson both ducked out on questions from a publication that is demonstrated it is pro-industry for years and years.
The Top Twelve Questions for Manufactured Housing Institute (MHI) CEO, Richard “Dick” Jennison
What are they hiding?
Why are they even hiding from their members good news that they ought to be spotlighting?
Parting Takeaways for Today
Honorable, Non-Monopolistic Investors who take a long-term horizon view of manufactured and other forms of factory built housing ought to – and will – dive in.
Current Industry players who aren’t giants are the current best friends of a giant should demand action.
MHI needs to open its books, open its bylaws, and undergo a third-party forensic examination for conflicts of interest. We think there may be good reasons to disband the organization, as hopelessly corrupted (again, that’s not a slam on most members, but all must be aware of potential liability from maintaining their membership).
Fiduciary Responsibility to Corp Shareholders-MH Anti-Trust Concerns; Plus MH Market UPdate$
Berkshire Hathaway ought to face precisely what some have advocated, anti-trust action. That action should not be limited to Warren Buffett and his brands, because what happened last Tuesday was not the first or last time that billions of dollars in wealth could be wiped out by such market machinations.
The time for anti-trust civil, administrative and criminal investigations is long overdue. Personalities across he political spectrum in and outside of manufactured housing say so.
We believe that among the best ways to advance the industry is to expose MHI, and break up Berkshire Hathaway.
Until that happens, millions are being harmed, small business as being forced to sell for less than their value, or have been forced to close.
Its an American tragedy. It’s Dark Money Conflicts that are harming real business people, and everyday Americans. These are our concerns. We’ve laid out the facts, and just some of the evidence in the above. Given Kevin Clayton’s own words, plus the links, isn’t it more than enough? “We Provide, You Decide.” © ## (News, analysis, fact checks, commentary.)
(Third party images and information are provided under fair use guidelines.)
L. A. “Tony” Kovach is an award winning manufactured housing industry veteran, and is the managing member of LifeStyle Factory Homes, LLC – the parent company to MHLivingNews.com, MHProNews.com and professional service provider to the factory-built housing industry.
Connect on LinkedIn: http://www.linkedin.com/in/latonykovach
