The answer to misinformation isn’t censorship or throttling, as some would claim. The common answer to misinformation is better information and a better presentation of information. While there may be some exceptions to the rule, perhaps something like not publishing nuclear secrets that could end up costing millions or billions of lives, the normal response to misinformation should be to offer correct, more accurate, and more useful information. Nor is that solely the view of MHProNews. It was the view of 150 thinkers, many from the left, who shared those thoughts as are shown below. Additionally, for decades (centuries, actually) it has been well known that debate and vigorous discussion are useful for clarifying what is true and what may be lacking. Manufactured housing has been underperforming for a quarter of a century. Clearly more action is necessary and greater clarity of messaging can benefit that effort. With those thoughts in mind, a respectful yet at times pointed review of Arica Young, Ph.D., and her “Unleashing Manufactured Housing” via the Cato Institute’s website will be provided herein. For the record, Cato is not known as the type of organization that would want censorship. Quite the opposite would be there more likely stance, based on their long and generally respected history.
The quotes shown are not to target Cato or Arica Young and the Lincoln Institute for Land Policy. Rather, they are to inform those readers who may not already be familiar with the value and importance of vigorous discussion and the genuine and honest clash of ideas. A parallel quote from Robert F. Kennedy Jr. on the scientific method, he’s an attorney with a history of some significant legal victories, is relevant.
According to Influence Watch, “The Cato Institute is a libertarian think tank based in Washington, D.C. Founded by Libertarian Party activist Ed Crane, libertarian economist Murray Rothbard, and businessman Charles Koch, the organization conducts policy research in support of libertarian policies and has been credited with bringing libertarianism into the political mainstream.”
With that preface, this preview of Young’s thoughts on Unleashing Manufactured Housing should be viewed through this factual lens.
- Using a WORD search of her text via Cato that follows, there is no result for “Manufactured Housing Improvement Act,” or “preemption,” much less for “enhanced preemption.”
- The words “Duty to Serve” appears twice, and one of those is as a reference to an article co-authored by Jim Gray. More on that later herein.
- “Immigration” is used once, more on that further below too.
Among the items on the potential plus side of what follows is this conclusion by Young.
And as long as the federal government remains intensely involved in subsidizing home ownership—albeit with questionable effects on home ownership rates—it is worth asking whether its policies should continue to effectively exclude manufactured homes from this largesse—or put traditional homes and manufactured homes on the same financial footing by reducing such subsidies.
The Manufactured Housing Association for Regulatory Reform (MHARR) has long argued that manufactured housing should get precisely the same treatment as conventional housing. To do otherwise is discriminatory and harmful to the interests of the millions who need affordable housing, which Young aptly spotlights that need for millions in the U.S.
While her article was published pre-election, the essential points still apply. Highlighting in what follows is added by MHProNews.
Part II provides additional facts, evidence and manufactured home industry expert analysis.
Part I
Unleashing Manufactured Housing
By Arica Young – Lincoln Institute for Land Policy (via Cato website)
The United States presently has an estimated shortage of 3–5 million housing units.
Spring 2024 • Regulation
By Arica Young
Nearly every US politician is talking about improving housing affordability, and most of them are looking intently for villains to blame for today’s high home prices. Despite rhetoric to the contrary, the price escalations in recent years have not been driven primarily by “speculators” or short-term rentals, and there does not appear to be a bubble. Rather, there is a fundamental imbalance between housing supply and market demand, especially in the for-sale market.
The United States presently has an estimated shortage of 3–5 million housing units. That shortage is most acute in the market for entry-level homes, typically defined as those that are 1,400 square feet or smaller. Since the late 1970s, builders have produced roughly the same number of these homes on an annual basis, even as the US population has increased by over 50 percent.
With tight labor markets, surging materials costs, and now high interest rates, the cost of on-site home construction has increased sharply. Consequently, some developers have turned to manufactured housing, where the dwelling is constructed in a factory and then installed on the building site, to meet demand for entry-level homes. While many people associate manufactured housing with mobile homes and trailer parks, modern production methods and design improvements have made today’s manufactured homes look nothing like their antecedents. Yet, land and construction regulations that were written to restrict house trailers limit the deployment of modern manufactured housing. A few policy changes and zoning fixes could bolster its use and provide more options for Americans who want to become homeowners.
No longer a trailer / Today’s manufactured home is the only form of housing subject to federal regulation under the Manufactured Home and Construction and Safety Act, overseen by the Department of Housing and Urban Development. These homes must be permanently placed on a steel chassis and consist of a minimum of 320 square feet and be at least 8 feet in width. (Trendy “tiny homes” are not considered manufactured housing.) The federal standard also has guidelines for room size, fire safety, heating, cooling and plumbing systems, framing, insulation, wind load, and installation. They are certified and labeled in the production factory. Without the label, the homes cannot be called manufactured housing. Other factory-built rooms, interior spaces including garages, and homes—often referred to as prefabricated or modular—are not deemed manufactured houses under the act and are subject to local and state building codes.
To monitor compliance, HUD has delegated authority to 13 states and private sector organizations that inspect manufactured housing factories. Since the 1990s, the department has periodically upgraded its standards. Recently, both HUD and the Department of Energy have begun rulemaking to impose new energy and safety standards to reduce utility bills and carbon pollution.
States can require more stringent requirements beyond the federal standards. For example, in the aftermath of Hurricane Andrew in 1992, Florida mandated a specific manner and number of ties to affix manufactured housing. Many manufactured homes now perform as well as site-built homes during extreme weather events.
Been here before / Manufactured housing has been an important source of housing in the United States for a long time. These homes have their roots in the early travel campers of the 1920s and were used as temporary housing for public works employees during the Great Depression and World War II. After the war, as the United States faced a severe housing shortage, families turned to manufactured housing. The industry responded by creating innovative models with more spacious layouts and modern amenities such as washing machines.
Around this time, many manufactured housing communities had their start. Households could purchase and finance a home through the dealer, much like buying a car. Quickly, however, the sector had to compete with a recovered and robust residential housing sector using site-built construction for homes that could qualify for federally backed home financing—unlike manufactured housing.
Manufactured housing stock currently consists of 6 million units and constitutes the largest share of unsubsidized low-income housing in the nation. Today’s manufactured homes have tight building envelopes (that is, a well-made exterior that protects the interior), energy-efficient appliances, and often have features such as porches, garages, and bay windows akin to local housing design.
Historically, the ability to produce homes has relied on locally available land, labor, and building materials. Regulations have caused land prices to skyrocket, often because of artificial scarcity driven by restrictive zoning categories and land-use regulations. (See “Build, Baby, Build!” p. 64.) Layers of environmental review, special purpose permitting, rezoning requirements, and often contentious rounds of public hearings add expense and uncertainty that discourage developers from building entry-level homes. The National Association of Homebuilders has estimated that regulations account for nearly one-fourth of the final price of a new single-family home.
Other factors have raised housing costs of late. Higher capital costs have increased the costs of developing new projects, and ongoing labor shortages in the building professions will probably continue because of demographic shifts and tightening immigration policies. Factory-produced homes can address many of these challenges: a recent study from Harvard University’s Joint Center for Housing Studies found that manufactured homes can be as much as 46 percent cheaper than site-built.
If policymakers want to use manufactured housing to improve housing affordability, they must reform two areas of regulation: discriminatory zoning and the titling of manufactured housing.
Zoning / Today, zoning and land-use regulations are under increasing scrutiny, as they have a significant effect on the ability to develop various forms of housing, such as duplexes, rowhomes, and multifamily buildings. Many states and cities explicitly ban manufactured housing, typically motivated by long-held stigmas about the social and economic effects manufactured homes (and their occupants) have on neighboring properties.
Land-use legal scholar Daniel Mandelker of the Washington University School of Law has outlined 18 common zoning and land-use categories of regulation that either outright forbid the placement of manufactured housing, impose stringent exclusionary design prerequisites, or require obtaining special permits that are not imposed upon site-built single-family homes. For example, one common statute, especially in municipalities, prohibits the placement of single-wide manufactured homes even though they could easily work as in-fill for many cities struggling to replace aging housing stock.
While several states have prohibited such bans at the local level, other communities have adopted or are considering regulations that would de facto push out the dwellings. For instance, some places require that manufactured homes be situated on parcels of land ranging from one to 10 acres even if such a minimum requirement does not apply to site-built homes. Other restrictions on manufactured housing include limits on the home’s age or requirements for specific architectural design features that do not apply to site-built single-family homes.
Titling / Given their legacy as travel campers, some states only allow manufactured housing to be titled as personal property, not real property, even if the home is affixed to a foundation on owner-occupied land. This has significant implications for financing, as traditional mortgage financing is limited largely to real property. Personal property financing (also called chattel financing or lending) does not have the full range of consumer protections available to traditional mortgage borrowers.
Further complicating matters is that more than 50 percent of manufactured homes are financed through personal property loans, which often have relatively high interest rates and fees. Many consumers are not aware that there are other (albeit limited) options: Fannie Mae and Freddie Mac have a statutory mission mandate under Duty-to-Serve that requires them to create products and programs to serve the manufactured housing market.
Finally, titling has tax implications that can affect the affordability of the homes. Some states levy taxes on personal property. For example, in some states, vehicle owners must pay a personal property tax levied on the value of their car. The tax rate for personal property differs from the rate levied on real property. Depending on the location, the personal property rate may be significantly higher than for a site-built home. To address the titling issues, states must examine their titling regulations for both real and personal property. New Hampshire broadly allows manufactured housing to be titled as real property, and it offers a model for other states looking to review their titling regulations.
Unleashing change and growing supply / There are innovations in the residential sector that can boost the creation of new housing. One of these is manufactured housing. But for potential homebuyers to take advantage of this, policymakers must liberalize land-use and zoning regulations and states must reform titling policies regarding manufactured housing.
And as long as the federal government remains intensely involved in subsidizing home ownership—albeit with questionable effects on home ownership rates—it is worth asking whether its policies should continue to effectively exclude manufactured homes from this largesse—or put traditional homes and manufactured homes on the same financial footing by reducing such subsidies.
Readings
- “Comparison of the Costs of Manufactured and Site-Built Housing,” by Christopher Herbert, Chadwick Reed, and James Shen. Joint Center for Housing Studies of Harvard University, July 2023.
- “Duty to Serve: The Purpose of Fannie Mae and Freddie Mac and Early Lessons Learned in Underserved Housing Markets,” by Jim Gray and George W. McCarthy. Lincoln Institute of Land Policy, 2021.
- “Getting Zoning for Manufactured Housing Right,” by Daniel R. Mandelker. Lincoln Institute of Land Policy, 2023.
- “Government Regulation in the Price of a New Home: 2021,” by Paul Emrath. National Association of Home Builders, May 5, 2021.
- “New Evidence Shows Manufactured Homes Appreciate as Well as Site-Built Homes,” by Laurie Goodman, Edward Golding, Bing Bai, and Sarah Strochak. Urban Institute, September 13, 2018.
- “Zoning Barriers to Manufactured Housing,” by Daniel R. Mandelker. Washington University, 2016.
Part II – Additional Facts – Evidence and MHProNews Analysis
In no particular order of importance are the following observations, additional facts, and evidence.
1) The thrust of Young’s article for Cato is fine. What follows are possible refinements and unmentioned points that shed more light on her important subject of “Unleashing Manufactured Housing.”
2) The U.S. Department of Housing and Urban Development (HUD) is the primary federal regulator for HUD Code manufactured homes, as Young pointed out. HUD’s Policy Development and Research (PD&R) division’s Regina Gray, their director for affordable housing research and technology, shared relevant thoughts on manufactured housing. Among the points Gray aptly raised is that professional from around the globe have come to the U.S. to better understand HUD Code manufactured homes. Gray said that manufactured homes were the most important development from HUD’s Operation Breakthrough.
Gray said (see the linked report above) the following.
- “Operation Breakthrough’s biggest accomplishment, however, was the adoption of the HUD Code, which introduced the industry and the world to manufactured housing.”
- “In a recent publication focused on reducing barriers to innovation in housing, we learned that in efforts to convince housing industry professionals to consider adopting cutting-edge housing technologies, biases and uncertainties persist.”
- “Researchers are also tasked with identifying strategies adopted by local governments to reduce restrictive land use zoning requirements that often impede housing construction and reduce the housing supply, which typically cause housing prices to rise.”
- “This year’s Innovative Housing Showcase involved a joint effort with NAHB to feature innovative housing technologies and construction on the National Mall in Washington, D.C.”
So, several of the same points raised by Young were addressed by Gray along with other parallel and relevant topics. More on the above and related shortly.
3) Prior to the post by Gray on the HUD website promoting manufactured housing was another article co-authored by Gray and Pamela Blumenthal. MHProNews and MHLivingNews has referenced their work several times, including the report linked below. The search tools on MHProNews/MHLivingNews would reveal more.
Arguably among the key takeaways from the Blumenthal and Gray research entitled: “Opportunities to Increase Housing Production and Preservation” for HUD Edge are the following.
- “Without significant new supply, cost burdens are likely to increase as current home prices reach all-time highs…”
- “The regulatory environment — federal, state, and local — that contributes to the extensive mismatch between supply and need has worsened over time. Federally sponsored commissions, task forces, and councils under both Democratic and Republican administrations have examined the effects of land use regulations on affordable housing for more than 50 years.”
While there are other useful takeaways from that Blumenthal and Gray article, those two arguably merit keen focus. For over 5 decades, “more than 5o years,” the federal government has been studying land use issues. Are thinking people to believe that the federal government and both major parties studied the problems associated with regulations and zoning without offering a genuine solution? More on that further below. But also important is the economics 101 point about supply and demand. That too will be addressed later herein.
4) In a sense, Gray raised the issue of acceptance of manufactured housing as an issue when she pointed to the Innovative Housing Showcase (IHS) program initially launched by then HUD Secretary Ben Carson, M.D. MHProNews/MHLivingNews have covered each of those IHS events, that were skipped during the declared COVID19 outbreak. Reports on the first and most recent IHS events are linked below.
5) There are numerous other research reports that span the years that included or were focused on HUD Code manufactured homes. Young’s article for Cato mentions a few. But others merit mention beyond those cited by Young, Gray, or Blumenthal. A few will illustrate the point which will be tied into Young’s Cato article.
6) The National Association of Realtors (NAR) published an article for their professional Journal of Real Estate Studies entitled The Market for Manufactured Homes that was authored by Scholastica “Gay” Cororaton. The initial copy published by Cororaton had several apparent flaws (copy linked here). Those errors were brought to the attention of Cororaton by this writer and by MHARR’s President and CEO Mark Weiss. To her credit, Cororaton corrected every error, the NAR republished that entire issue of their journal, and she credited those corrections to Weiss and Kovach (moi). See that corrected version linked here. Cororaton said in footnote 1, page 48: “The author also thanks L.A. “’Tony” Kovach, Publisher, MH Living News and MH Pro News; Mark Weiss, President & CEO, Manufactured Housing Association for Regulatory Reform…for their insights and comments on the report.” Cororaton’s article was packed with graphics, tables, and statistics. Like Young for Cato, among the points Cororaton made was that manufactured homes are more durable during severe weather events.
a) Another point directly stated or sometimes implied in research on manufactured housing is the improper public perception. Lisa Tyler, Ph.D., earned her doctorate based on her doctoral research that was focused on manufactured housing. At the time, it was said to be the first doctoral dissertation on manufactured housing in years. See Dr. Tyler’s dissertation linked here, with a relevant pull quote from Tyler shown above. On page 7 (Acknowledgements) of her 343-page dissertation, Tyler kindly said: “I am incredibly appreciative of Tony “L.A. Tony K” Kovach’s insight, feedback, and valuable opportunities to generate interest and support for my research topic. I am an honored recipient of your generosity in sharing your extensive knowledge and experience.”
b) Tyler and Cororaton were cited in the article linked below along with research by Richard Genz and then Harvard Joint Center for Housing Studies (JCHS) fellow Eric Belsky. Genz produced a 22-page report for the Fannie Mae Foundation in 2001 entitled “Why Advocates Need to Rethink Manufactured Housing.” That report by Genz is linked here as a download.
c) In that research, Genz said the following.
d) Naturally, out of hundreds of pages by produced by Tyler, Cororaton, and Genz, more could be quoted or said. For instance, research pointed out over 2 decades ago that manufactured homes can and did often appreciate. That is a point often not mentioned in articles like those by Young, which does not use the word appreciation. More on that shortly.
e) But next, let’s briefly look at the curious tale of Eric Belsky, who has since left Harvard JCHS and to join the Federal Reserve. Per a post on Belsky’s bio for the JCHS website: “Eric Belsky led the Center for four years before being appointed to head the Federal Reserve Board’s Division of Consumer and Community Affairs.”
f) With that backdrop Belsky, according to an item published by the Manufactured Housing Institute published Modern Homes, a now defunct trade publication, said the following.
g) More on each of those points later below.
7) On our websites we have posted as downloads and shared the research of scores of third-party produced items. Among them that are related to Young’s topic is more research produced by HUD during the President Barack Obama-VP Joe Biden era is “Regulatory Barriers to Manufactured Housing Placement in Urban Communities.”
8) So, as even this relatively focused review reveals, there are indeed decades of research on broadly the same topic that Young addressed in her article for Cato. Depending on the writer, what is often lacking is the tragic reality that this history of discriminatory treatment that harms affordable housing seekers spans decades. With Belsky and the Fed in mind, two more sources will be mentioned, the first being the research by James A. “Jim” Schmitz Jr. and his colleagues, many of whom work for various parts of the Federal Reserve system. Schmitz appears to be the common link to research articles and longer reports published by various economists.
To frame Schmitz and his colleagues’ remarks, a question should be raised that is suggested by the Albert Einstein quote in the preface above. Given decades of research, why is it that often very similar articles are written, which may or may not reference other articles and research. Why is it that so much is said as if this was a new or fairly recent discovery? Schmitz et al have essentially addressed that by alleging with evidence that monopolistic practices are hampering manufactured housing acceptance and growth.
9) Schmitz and his colleagues point out, among other factors, that this “sabotage monopoly” tactics dates back to at least the 1940s. Nor does Schmitz’s research limit itself to manufactured housing. They cite other areas of the economy that have been hampered by what a phrase first used in the 1940s by Henry Simmons and Thurman Arnold. This Q&A with left-leaning Bing’s AI powered Copilot provides a useful outline.
Provide an outline of Henry Simmons and Thurman Arnold insights on sabotage monopoly tactics
Here’s a brief outline of the insights from Henry Simons and Thurman Arnold on sabotage monopoly tactics:
Henry Simons
- Elimination of Monopoly: Simons believed that the most important policy change to limit poverty and inequality was the elimination of monopoly in all its forms.
- Deceit and Misinformation: He noted that monopolies often employed deceit and misinformation to inflict harm, which could go undetected for years.
- Impact on Necessities: Simons argued that in a monopoly economy, luxuries expand while the necessities of life contract.
Thurman Arnold
- Sabotage and Destruction: Arnold described monopolies as entities that sabotage and destroy markets, often targeting substitutes for their products.
- Exploitation of Necessities: He emphasized that monopolies exploit necessities, which are the most dangerous because people cannot do without them.
- Public Institutions: Arnold also pointed out that monopolies infiltrate and damage public institutions to enrich themselves.
These insights highlight the detrimental effects of monopolies on society and the economy, emphasizing the need for effective antitrust laws and policies to curb their influence.
Does this help clarify their perspectives for you?
10) Should someone use the search tool of the MHARR or MHI websites, these names would likely not be found. In the case of MHARR, they are a production-focused trade group. When asked, they would often respond with these issues of zoning, finance, and education/acceptance are post-production issues. Agree or not, that is their consistent position for years. MHARR have dealt with zoning and finance or financing dozens of times on the MHARR website primarily because in their view the Manufactured Housing Institute has failed to address these longstanding “bottlenecks” effectively.
11) By comparison, MHI embraces the notion that they have said on their own website for years that they represent “all segments” of the industry and advocacy. MHI have production and post-production members. MHI has an education affiliate. MHI is well aware of the “stigma” issue raised by Genz over 2 decades ago and more recently carefully documented by Dr. Tyler in her hundreds of pages of doctoral research. MHI is also aware of the steep fall of manufactured housing, addressed by their prior President and CEO Chris Stinebert.
12) According to industry sources, Stinebert was brought on board at MHI specifically with the notion of working with MHARR to enact what became the Manufactured Housing Improvement Act of 2000 (a.k.a.: MHIA 2000, MHIA, 2000 Reform Act, 2000 Reform Law). The MHIA provided for what was called “enhanced preemption” over local zoning barriers. The phrase “enhanced preemption” is so called because the original HUD Code enabling legislation had federal preemption too, but it needed to be “enhanced.”
Missing from the articles and research by Young, Blumenthal, Gray, and many if not most third-party researchers is that key topic of “enhanced preemption.” A search for enhanced preemption on the MHARR website reveals pages of linked articles. Another term that MHARR uses is “federal preemption.”
13) On paper, given that Stinebert was brought on with MHI to work with MHARR to get enhanced preemption into federal law, it is no surprise that leaders of both national trade groups have used and referenced that topic. Some examples are shown. MHI’s then VP Lesli Gooch (now CEO) wrote then HUD Secretary on July 18, 2019. to say in part that MHI wanted to see enhanced preemption enforced.
What makes Gooch and MHI’s stance curious is that there is no use of the phrase “enhanced preemption” on their own website. Indeed, not only does their website lack that legally and conceptually significant phrase, but so do trade publishers and bloggers who align with them.
This test by MHProNews of searches for that phrase has been periodically performed for years. When asked, MHI is silent on that odd omission. Why use the phrase in a letter but not use it on your own website and in op-eds, social media, or with friendly trade media? Perhaps more vexing, MHI used to have on their website the document shown below. It is no longer found there. Note the letter showed cases of federal preemption being exerted by then administrator of the Office of Manufactured Housing Programs (OMHP) William “Bill” Matchneer, J.D.
14) To illustrate that enhanced preemption point, consider the two connected responses from Copilot. The first produced an inaccurate response, but the second corrected the first error when asked by this writer for MHProNews.
Scan the Manufactured Housing Institute website, the MHInsider website, and the ManufacturedHomes.com blog. Can you find any use of the phrase “enhanced preemption” on them? Can you find any use of the phrase “enhanced preemption” as part of the Manufactured Housing Improvement Act of 2000 in any social media or op-ed authored by the Institute?
Would you like more details on any of these references?
Pardon me, Copilot, but those items you linked are on the MHProNews website, not on the Manufactured Housing Institute website, isn’t that correct? By contrast, the Manufactured Housing Association for Regulatory Reform uses the phrase Enhanced Preemption numerous times on and beyond their website, in press releases, interviews, etc., right?
The Manufactured Housing Association for Regulatory Reform (MHARR) does frequently use the phrase “enhanced preemption” in their press releases, interviews, and other communications. They emphasize the importance of federal preemption in the manufactured housing industry, particularly as established by the Manufactured Housing Improvement Act of 2000.
Thank you for pointing that out! Is there anything else you’d like to know or discuss?
1 manufacturedhousingassociationregulatoryreform.org
You were previously quoted as saying that the fastest way to accelerate manufactured housing growth is to enforce existing laws, right? https://www.manufacturedhomepronews.com/masthead/cats-out-manufactured-housing-institute-housing-coalition-letter-to-congress-fact-check-analysis-reveals-what-mhi-nar-nahb-mba-others-did-didnt-request-ai-affordable-housing-surprises-await/ While other efforts, like lobbying, public relations, marketing, etc. are useful, given that there are federal laws that are supposed to provide more competitive financing (Duty to Serve or DTS, and FHA Title I and other federally supported lending programs) and “enhanced preemption” provides a legal tool grounded in federal law to overcome zoning barriers, isn’t the logical course of action advocated by MHARR, MHProNews, MHLivingNews, and researchers such as Samuel Strommen, isn’t it common sense to enforce existing laws if a faster response is desired for the affordable housing crisis in the U.S.? Confirm or clarify and link results as needed.
Enforcing these laws would ensure that manufactured housing can be more competitive and accessible, which is crucial for increasing the supply of affordable housing. This approach is seen as a more straightforward and faster solution compared to other efforts like lobbying or public relations.
Would you like more detailed information on any specific aspect of this topic?
1manufacturedhousingassociationregulatoryreform.org
16) Let’s review before pushing ahead.
Young referred to: “Unleashing Manufactured Housing.”
Prior MHI President and CEO, Richard “Dick” Jennison spoke about “unchaining” the manufactured home industry. More specifically, he said that unchaining the industry could lead to 500,000 manufactured homes being produced per year.
To the point of what are the items that need to be “unleashed” (Young) or “unchained” (Jennison), she emphasized zoning barriers and titling. Jennison’s expression was at that moment more focused on financing. Each of those are important, as are education, marketing, publishing research, more effective lobbying, litigation, and advocacy.
To some of those later points, Young cited Daniel Mandelker, J.D., in her footnotes. MHProNews previously unpacked his research. Besides pointing out various problems Young cited on zoning barriers, Professor Mandelker pointed out that there is an organization needed by manufactured housing to litigate these issues and to provide legislative support. It should be noted that he didn’t mention MHI.
17) As recently as July 2023, Cavco Industries (CVCO) president and CEO, William “Bill” Boor – then MHI’s vice chair, and currently their chairman, referenced in the context of a Congressional hearing that enhanced preemption needed to be enforced. The language Boor used was similar to what Gooch did in her letter to Dr. Carson during his term as HUD Secretary.
Every reference to federal enhanced preemption should be considered in the light of a letter by Democratic Congressional lawmakers to prior HUD Secretary Mel Martinez during the Bush 43 (R) era. Their full letter is shown at the link below that screen grab, here, and here.
18) Troubling is the point that approaching a quarter of a century ago, Congress in a widely bipartisan effort enacted the 2000 Reform Law, which included that enhanced preemption language. That language for the MHIA of 2000 is found as part of the Senate report favoring the bill on the Congressional website at this link here. It said in part as follows.
In testimony offered by William Lear on behalf of the
Coalition, Mr. Lear testified to the inability of HUD to update
the code in a timely manner:
HUD has failed over the years in its most important
obligation--to update the standards on a timely basis.
MHProNews has illustrated that in the report on 9.12.2024 linked below, when HUD admitted that it took 30 years to do the updates they recently touted. MHARR advocated for those changes that were finally adopted two months ago.
Lawmakers noted the following. Note that the dispute resolution program is not typically available to far more costly conventional housing buyers. Meaning, less expensive manufactured home consumers have a consumer protection feature not found with many if not most site builders.
This bill establishes a national model for installation of manufactured homes, which includes inspection, and a dispute resolution program.
The language of the law is found on the Congressional site linked here.
42 USC Ch. 70: MANUFACTURED HOME CONSTRUCTION AND SAFETY STANDARDS
§5401. Findings and purposes
(a) Findings
Congress finds that—
(1) manufactured housing plays a vital role in meeting the housing needs of the Nation; and
(2) manufactured homes provide a significant resource for affordable homeownership and rental housing accessible to all Americans.
(b) Purposes
The purposes of this chapter are—
(1) to protect the quality, durability, safety, and affordability of manufactured homes;
(2) to facilitate the availability of affordable manufactured homes and to increase homeownership for all Americans;
(3) to provide for the establishment of practical, uniform, and, to the extent possible, performance-based Federal construction standards for manufactured homes;
(4) to encourage innovative and cost-effective construction techniques for manufactured homes;
(5) to protect residents of manufactured homes with respect to personal injuries and the amount of insurance costs and property damages in manufactured housing, consistent with the other purposes of this section;
(6) to establish a balanced consensus process for the development, revision, and interpretation of Federal construction and safety standards for manufactured homes and related regulations for the enforcement of such standards;
(7) to ensure uniform and effective enforcement of Federal construction and safety standards for manufactured homes; and
(8) to ensure that the public interest in, and need for, affordable manufactured housing is duly considered in all determinations relating to the Federal standards and their enforcement.
(Pub. L. 93–383, title VI, §602, Aug. 22, 1974, 88 Stat. 700; Pub. L. 96–399, title III, §308(c)(4), Oct. 8, 1980, 94 Stat. 1641; Pub. L. 97–35, title III, §339B(c), Aug. 13, 1981, 95 Stat. 417; Pub. L. 106–569, title VI, §602, Dec. 27, 2000, 114 Stat. 2997.) …”
In short, a widely bipartisan Congress passed, and then President William Jefferson “Bill” Clinton (D) signed into law the legislation that made the 2000 Reform law.
Since many if not most researchers fail to mention this legislation in conjunction with federal preemption specifically cited are real problems. Without such information, there is a false impression that may be formed by readers, news media, and other researchers. Congress studied the legislation related issue for 12 years, it was said during the hearings on failures in implementation of the MHIA of 2000. Among the questions that ought to be raised? Why is it that MHARR has pages of references to this issue, and MHI’s website has been apparently culled of references to this critical topic? Pages more of articles on the MHARR website have been published since the search shown on the date below.
19) As numerous prior screen-captures of the MHI website illustrate, MHProNews has been doing this fact check for years. MHI leaders decline answering why this information has been verbalized or placed in letters by Gooch or others but has oddly not been placed on MHI’s own website?
20) It gets more troubling. MHI did an interview with Multi-Housing News (MHN) that addressed this issue barriers to manufactured housing growth. Gooch failed to raise “enhanced preemption” language then, before, or since.
21) MHProNews asked MHARR’s President and CEO Mark Weiss, J.D., to address substantially the same questions as Gooch did, to illustrate the stark contrast between what she said and what should or could have been said.
22) MHProNews then took the added step of documenting and amplifying those findings via the Patch.
23) Nicholas Julian is the Senior Program Manager, Land Use for the National Association of Home Builders (NAHB). He recently authored a report that involved this topic of land use.
Julian said without subsidies for building and developing building for conventional builders would be “untenable.” MHProNews contacted Julian to see if MHI had contacted him about his article.
| from: | Nicholas Julian NJulian@nahb.org | ||
| to: | “L. A. Tony K” <latonyk@gmail.com> |
||
| date: | Nov 12, 2024, 10:24 AM | ||
| subject: | RE: Nicholas Julian, media outreach about your zoning and affordable housing post on NAHB |
Good morning,
I have not heard from MHI, no.
Best,
24) A few weeks earlier, NAHB published a manufactured housing specific report. It revealed embarrassing data from the vantage point of MHI.
25) MHProNews periodically picks certain published items, spotlights them, and often (not always) asks for comments from those who wrote the article. MHProNews also periodically asks MHI leaders to respond to issues. It has been some time since MHI has responded, despite years of prior praise by MHI leaders and others for fairness and accuracy in reporting.
The above and below were remarks offered for publication by higher profile corporate leaders who served on MHI’s board of directors.
After prior MHI president and CEO Richard “Dick” Jennison was quietly called out by this publication for the problematic statement he made below during a video interview, as part of a longer mea culpa, Jennison later offered a correction that included his 500,000 units a year potential remark shown above.
As part of that same video recorded address to dozens of manufactured housing industry professionals, Jennison also praised MHProNews. Jennison may have had a touch of snark in his voice, so MHProNews had some fun with this short video of his praise.
26) A key part of the raison d’être for MHProNews and our sister site is to facilitate the information that can lead to industry growth.
The point of some of the above and what follows is to help newcomers have a frame of reference for MHI’s problematic handling of issues. MHProNews was a MHI member for some 7 years, including service on their Suppliers’ Division board of directors. This writer presented for several MHI events and state/regional events.
Jim Gray was mentioned by Young above, that is Gray in the photo with this writer for MHProNews on the left below.
This writer provided successful and praised marketing and education for several years of regional events.
The point in part is that for a time, MHProNews trusted MHI’s efforts at face value. But as time advanced, and evidence mounted that MHI was saying some things to certain audience, but may do something not in keeping with prior remarks became too big to ignore. Those two video clips of Jennison above are important, because the second one (the longer video of Jennison is linked below the still in #16 above) was a stark contrast between being okay with less than 65,000 new homes built in 2014 vs. telling the industry’s members just a few events and less than a year later (2015, when 70,544 new homes were produced that year) that the industry’s goal should be half-a-million new homes a year.
27) From the article linked here is the following table of national manufactured home production per year for the years show.
| Year | Production |
|---|---|
| 1995 | 344,930 |
| 1996 | 363,345 |
| 1997 | 353,686 |
| 1998 | 373,143 |
| 1999 | 348,075 |
| 2000 | 250,366 |
| 2001 | 193,120 |
| 2002 | 165,489 |
| 2003 | 130,815 |
| 2004 | 130,748 |
| 2005 | 146,881 |
| 2006 | 117,373 |
| 2007 | 95,752 |
| 2008 | 81,457 |
| 2009 | 49,683 |
| 2010 | 50,056 |
| 2011 | 51,618 |
| 2012 | 54,881 |
| 2013 | 60,228 |
| 2014 | 64,334 |
| 2015 | 70,544 |
| 2016 | 81,136 |
| 2017 | 92,902 |
| 2018 | 96,555 |
| 2019 | 94,615 |
| 2020 | 94,390 |
| 2021 | 105,772 |
| 2022 | 112,882 |
| 2023 | 89,169 |
28) Missing from many reports, short or longer, regarding manufactured housing and ‘what is holding the industry back’ are often key facts. Among the curious oversights, perhaps because it isn’t suspected, is how it is possible for an industry that used to produce 250,000 (mol) new HUD Code manufactured homes average for years on end, which suddenly plunged in the 21st century and has failed to recover. That failure to recover is despite favorable legislation and laws that provide for federal support for more competitive manufactured housing lending. Skyline Champion is now Champion Homes. Their SKY Investor Relations pitch deck included the graphic below, which has been re-cropped, had arrows added and annotated to focus on specific facts. For example, look at the sudden surge from 1991 to 1994. What the below illustrates is that the HUD Code home industry is historically capable of gearing up in relatively short order.
29) Despite that potential to gear up quickly, the industry slid after the 2000 Reform law. It slid even further after DTS was made law in Housing and Economic Recovery Act (HERA) of 2008. What explains that slide? The common answers given are zoning barriers and less than competitive financing. Young says titling, okay, an issue. But titling laws have improved since 2000, yet, before 2000 there were more homes sold. These are the kind of factual disconnects that most outsiders looking in fail to address.
In 2004, MHI president and CEO Stinebert told the Wall Street Transcript that the industry was poised to rebound to the kind of levels seen during the mid-to-late 1990s. But look at the data in the table in Part II #27 above. In 2004 had fallen to 130,748. 6 years before, the industry stood at 373,143 total domestic housing starts, which Jennison (see #16) may have failed to recall correctly, with the quote graphic reflecting the remarked 372,000 in 1998. But last year (2023), production was down again to 89,169. Yes, zoning and financing are issues, so are obviously flawed education, marketing, research reporting, advocacy, etc. MHI hired Gail Cardwell, a mortgage professional association expert with finance experience after Stinebert left the trade group. Cardwell as MHI president and CEO did a presentation that showed the massive slide of mortgage originations from FHA Title I lending.
That illustration by Cardwell is almost never mentioned by any source other than this one. Why not? MHARR pointed to the need for Title I reforms. In fairness, MHI did too. But MHI was ‘on point,’ so to speak, because lending is a post-production function. The failures of the industry are routinely from the post-production side of the fence is the point that MHARR routinely makes.
30) Perhaps as a backhanded way of obscuring those failures that should land in MHI’s lap is the fact that Cardwell, Stinebert, and Thayer Long – all prior presidents/CEOs at MHI – have had their names memory-holed by MHI.
31) Eric Belsky was brought to this publication’s attention by MHI’s Modern Homes. Yet, MHI’s website no longer has Belsky’s name on it. The collage below is by MHProNews, which illustrates the Orwellian vanishing of Belsky by MHI on their own website. But Belsky isn’t alone. Genz isn’t there. MHI prior presidents/CEOs aren’t there from days gone by when the association was either experiencing better times and/or was seriously discussing implementation of laws that were supposed to fix the problems that are causing manufactured housing, to borrow Young’s terminology, to be “leashed” instead of “unleashed.”
32) MHI make serious efforts to appear to be much the same as other trade groups. It may well be that they were ‘more normal’ decades ago. But perhaps like the U.S. Chamber of Commerce became the voice of big business instead of smaller or all businesses, MHI now appears to be the trade group of insiders instead of “all segments” of the industry as MHI routinely claims. Ironically, Dr. Richard Rahn, Ph.D., made such claims for Cato, the same platform Young used. The point of interest in what followed below by Rahn is his allegation of “corrupt” nonprofits.
33) Let’s do another mini-summary. Young, Mandelker, Gray, Blumenthal, and others named herein may not be as much ‘wrong’ as they are ‘missing’ key facts. It isn’t as if JCHS, is the Niskanen Center, HUD, or Freddie Mac, or an array of third-party researchers have all gotten into a room and decided to publish interesting but somehow lacking research. We have covered such research for years. Regardless of detail, they for whatever reason often have the same flaws.
34) Rather than speculate as to why such often respected sources fail to pull together the key data they should is an important question. Are they, for instance, asking MHI for input but not MHARR? In the case of the 2018 research by Cororaton for NAR, MHI was involved initially. Look at the first footnote of the flawed originally published copy of the research that was published. The flawed copy linked here was apparently reviewed by MHI. How did MHI miss those errors? Was it laziness? Sloppiness? Something else? Again, to Cororaton’s, NAR’s and the Journal of Real Estate Studies credit, once this writer and MHARR’s Mark Weiss pointed out the errors, Cororaton corrected every error that she was informed about. The NAR pulled from their website the flawed copy, and then republished that entire issue of their journal with the corrections made. Cororaton then added to footnote one credit for those corrections to Weiss and Kovach (c’est moi). That corrected version is linked here.
35) MHI is failing the industry. This writer resisted the notion for some time that MHI was, for whatever reasons, failing to spotlight what is obviously necessary. Here is how artificial intelligence summed it up. See the quotes at the base of the illustration. The top quote is the hyper summary of just how ludicrous MHI’s performance arguably has been in the much (not all) of the 21st century.
Said Copilot:
- “If MHI is genuinely committed to advancing the industry, consistent advocacy for existing laws should be a priority.
- “Prioritizing enforcement of existing laws can have a more immediate impact on affordability and access to manufactured housing.”
36) Left-leaning Google’s Gemini had a similar finding.
37) Schmitz et al have said that monopolists have subverted affordable manufactured housing.
Schmitz also mentioned this.
38) Americans have increasingly taken notice of how many problems are caused by what amounts to oligopoly style monopolization in various professions.
39) National class action antitrust lawsuits blossomed in 2023 against key MHI members.
40) As the next two reports revealed, “moat” tactics and oligopoly style antitrust concerns are increasingly being recognized by federal and state officials, plaintiffs’ attorneys, and regional media.
41) But well before those reports were published, MHProNews and our MHLivingNews sister site reported on the concerns raised by Samuel Strommen and others that pointed to antitrust violations. The remarks by the late Sam Zell quoted below come into focus with these points in mind.
42) However notorious Frank Rolfe is considered to be, there are times he has said some demonstrably troubling truths. Among those are his critiques of MHI, and he is an MHI member.
43) Let’s sum up. Young, Mandelker, Gray, Blumenthal, and others have made some useful observations. But they are at best incomplete.
a) Strommen, Schmitz, and others have made evidence-based arguments for antitrust violations.
b) Something has to explain why MHI has failed to take the commonsense steps needed to get existing federal laws enforced. Failure on DTS and enhanced preemption are just two examples, but they are critical examples.
c) Current and former MHI members have blasted the organization and/or made statements that point to their failures.
d) To the point of “moats” raised by top DOJ antitrust official Jonathan Kanter and “sabotage monopoly” tactics raised by Schmitz et al, Kevin Clayton repeatedly used that “moat” terminology in a softball video interview with pro-Berkshire Hathaway Robert Miles. In that same video interview, Clayton told Miles that the industry was ready to address the stigma. That was 13 years ago. What happened?
e) Publications like the Atlantic, the Nation, the Seattle Times, Guru Focus and the Financial Times, among others, have reported on items related to this pattern of apparent violations of antitrust laws in the manufactured housing industry related to Warren Buffett, Berkshire Hathway, and Clayton Homes. Two examples are shown below.
With that backdrop, look again at the Clayton remarks mentioned above. Keep in mind terminology like paltering and posturing when considering some of these remarks
Then look at what antitrust legal researcher Strommen said was a letter (the bottom side of the collage below) that he said was an apparent tying antitrust violation. Click the image and follow the prompts to expand to a larger size for easier viewing.
f) The production side of manufactured housing collapsed (2009) after MHI’s Stinebert said (2004) the industry would turn around.
g) There has been an acceleration of consolidation on the production/retail side and on the community side.
From several publicly traded companies are clear evidence of consolidation as part of their business plan. To see that in a larger size, click the image and follow the prompts or click here and open the updated version of that graphic in a separate window.
g) This information has been presented to more than one FHFA listening sessions.
h) The revolving door may be part of the problem.
i) So, Young et al are not so much ‘wrong’ as they are incomplete. They fail to address an array of related and interconnected issues. Why researchers are hesitant to report on clearly documented concerns is a fair question. It is time to land the plane, but immigration must be mentioned too.
j) MHProNews/MHLivingNews plan to review other reports that have been recently published. Once again, MHI has avoided mention of them. Why is that so? Why is it that MHI has managed to keep the industry underperforming during an affordable housing crisis? When even an investment analysist is beginning to ask questions?
k) Young and others who have reported on manufactured housing. Don’t be discouraged. But try again. And look at what some longtime industry pros have had to say, because they have often pointed their fingers at MHI and the corporate interests who pull that association’s strings. When multiple sources inside or beyond that trade are pointing fingers at the same party, isn’t it time to at least mention that among the factors that need to be considered?
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By L.A. “Tony” Kovach – for MHProNews.com.
Tony earned a journalism scholarship and earned numerous awards in history and in manufactured housing.
For example, he earned the prestigious Lottinville Award in history from the University of Oklahoma, where he studied history and business management. He’s a managing member and co-founder of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.
This article reflects the LLC’s and/or the writer’s position and may or may not reflect the views of sponsors or supporters.
Connect on LinkedIn: http://www.linkedin.com/in/latonykovach
Related References:
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