Owners and operators of manufactured home communities are seeing interesting development trends in three areas of the manufactured home community business:
The need for new communities is great in most parts of the country. After years of vacancies in communities, most desirable existing communities are at or near capacity, resulting in an increasing demand for new projects.
Unfortunately, zoning new sites is difficult. Sewer and water availability in desirable locations where zoning is attainable is rare. Many available zoned sites are in undesirable or difficult locations. And public opposition to new communities continue to come from the “trailer park” perception.
Construction costs are rising, but so is the value of the finished project. As a result, it is important to take advantage of the unique ways development costs can be minimized by using knowledgeable manufactured housing community planners and engineers.
It is often easier to expand an existing community than to start anew. Zoning in many cases is less difficult since it is an expansion of an existing use. And hopefully the existing community is well managed and cared for and will generate minimal opposition.
If not, it is important to bring it up to respectability before seeking approval to expand. The expansion can also provide an opportunity for existing residents to upgrade to a new home in the expansion area, allowing for the removal of less attractive older homes.
New home sales in the expanded community provide an additional profit centre for the owner. Additional utility services may be available from the local suppliers or attainable through the expansion of the existing on-site facility. The addition of new sites to the existing community may not require a significant increase in overhead, another benefit to expansion.
Care should be exercised to the disruption of existing residents caused by construction activities. Also some upgrade in the community amenities is advisable to minimize resident concerns.
Upgrading an existing community is a win-win for the owner, the residents, and the industry. The community is already properly zoned and in a great location. Making the community more attractive and livable should be welcomed by residents and neighbours alike.
On the negative side, some communities have rezoned undesirable properties making the addition of newer homes difficult. However, many of our more progressive state associations have tackled this matter and made the practice unlawful.
Often municipalities require reconfiguration of home-sites to conform to the existing regulations regarding setbacks and lot sizes. Fortunately, many states allow for lot reconfigurations to reflect the rules that were in effect when the community was originally constructed. In fact, Michigan and Indiana are two states with that advantage.
Many times residents become concerned about their future. However, if the owner has the foresight to get its image in order first—entrance upgrades, street improvements, refreshed structure appearance, and landscaping—it can stimulate residents to upgrade their home and home-site appearance.
Revisions to the community’s Guidelines For Living in a reasonable time frame will assist in that effort.
All three of the options discussed, if properly done, will give the industry a much-needed image boost and ready the market for expansion.
Originally published on page 77 in MHInsider's State of the Industry Edition.