Western Village sees lot rent rise
Residents of Western Village manufactured home park have received a notice from their management that their lot rent will be increasing from $505 to $695.
Western Village residents have been waiting for this shoe to drop ever since their fellow Homes of America LLC-owned parks, Parkview and Holiday Park, received their lot rent increases back in September and October. The notice dated Nov. 1 is identical to the notices sent to the other parks, claiming that management had plans to improve and update the communities’ roads and common areas.
After the lot rent increases, residents have seen little of these promised improvements materialize, including new lease agreements with the companies managing them. Residents of the parks have found themselves stymied and frustrated by communication issues, and many have moved on. Some took advantage of deals offered by other local parks to cover the cost of moving along with lower lot rent than what Homes of America is demanding.
Based on quarterly reports filed with Ward County on Oct. 5, Western Village is the outlier of the three parks purchased by Homes of America LLC in Minot, with 87% of the manufactured homes tenant-owned and only eight lots vacant. In contrast, of Parkview’s 136 lots, 117 are park-owned, with 27 of them vacant. Holiday Park’s ratio is in between, with 69% owned by tenants and only 15 vacant lots.
According to Dave Anderson, executive director of the National Manufactured Home Owners Association, the consolidation of manufactured home park ownership has been ongoing since at least 2015.
“Several things have been going on at once. A lot of our communities were established mom-and-pops. There’s been a steady pace of consolidation of ownership for decades, from individual independently-owned parks to local, to statewide, to national,” Anderson said.
According to Anderson, what poured rocket fuel on the fire was the introduction of increased federal funding and lending for manufactured homes. While it was encouraging for the advocates and homeowners calling for more federal support in this sector, a majority of the loans were given to private buyers and equity firms rather than community residents.
“These firms were getting the more encouraging message about manufactured housing, about how the construction quality has improved over time and that more people were embracing them as a housing option. They decided to jump in with both feet using federally backed loans, which was not the intended purpose at all,” Anderson said.
These factors ultimately made manufactured home parks very appealing to investors of all sizes and origins, from the likes of Warren Buffett and Randall Smith of Alden Global Capital, to relatively small timers like Abraham Anderson of Sevierville, Tennessee, who was part of a group that recently purchased the Wheatland Village MHC in Minot.
Residents received a notice on Oct. 29 informing them of the change of ownership, which also announced a lot rent increase from $250 to $395. While conceding the increase is a bitter pill to swallow, the notice points out that this new rent is still among the lowest in Minot, especially when compared to the Homes of America communities. The new owners also made statements about making improvements to signage, that paving work will be done in the spring, and their desire to make the community the best in Minot. The notice concludes offering residents of other communities free moving fees and three months of free rent for bringing their homes to Wheatland.
The new local manager for Wheatland Village is Mike Fan, who is reachable by residents by phone. Fan said he is available to meet with residents in person if they have issues or concerns, and that they hope to have a local office either in the park or in Minot by the end of November. Fan reiterated the planned paving work, as well as plans for a playground to be installed in the spring.
Fan also confirmed that one of the new owners is local to Minot, but would not disclose the name, saying that, collectively, the group has been in the manufactured home park business for nine years and owns more than 30 parks, comprising over 2,100 lots. The only known owner is Abraham Anderson, who also operates a website and real estate investment podcast called Capital Cashflow, on which he shares his knowledge and promotes manufactured home park investing.
Abraham Anderson also has made an appearance on an episode of Mobile Home University’s podcast released in 2020, in which he was touted as a success story by MHU’s founders Franke Rolfe and Dave Reynolds. Anderson attended a MHU bootcamp in 2019, eventually acquiring 11 parks with 632 lots when the episode was recorded, making him the 100th largest owner of mobile home parks at the time.
In the episode, Abraham Anderson credited Rolfe and Reynolds for opening his eyes to the opportunity presented by manufactured home communities.
The National Mobile Home Owners Association’s Dave Anderson has a more negative view of the content and information produced by MHU and shared at its bootcamps.
“Their website is horrible and their videos are worse. They lay it out in especially plain language on their website that we are in an affordable housing crisis, that even people in the middle class can’t find as much affordable housing anymore, and that manufactured housing is this huge untapped resource,” Anderson said. “The best part about it? The customers are captive, so once you bought one of these communities, if you reduce maintenance, you cut the amenities and jack up the rent, what are they going to do?”
Fan acknowledged the growing concerns among manufactured home park residents around the business practices of companies such as Homes of America, LLC, but said his company will be doing everything it can to put its best foot forward. Fan reached out to the community on social media, addressing a number of concerns and communicating that repair and maintenance, such as repair of leaking pipes, are already underway.
“We understand there is fear due to other operators’ poor performance, and we know actions speak louder than words. We are convinced in the coming months, residents will see that we do care, will address concerns and make repairs quickly, and will work to make this one of the best parks in Minot,” Fan said.