Mobile Home Shipments Drop, Again
Americans are not buying many mobile homes any more. This is something that has been true for years, and the numbers are only getting worse.
The Census Department released new shipment numbers for May and provided a seasonally-adjusted prediction for annual sales in 2011. Their prediction is that there will only be about 40,000 new shipments this year. That portends a fall off of almost twenty percent from the same period last year. The fall in the rate of shipments is actually picking up steam. The numbers dropped 10 percent from 2009 to 2010.
Shipments of manufactured homes have been slipping for more than a decade.
It is a far cry from just ten years ag0, when the industry was shipping almost 300,000 homes per year.
The only thing that should provide some comfort to manufacturers is that they are gaining market share. We are on pace to have just 471,000 new single-family site built housing starts. Just a few years ago, builders were producing 1.2 million new single-family homes. While mobile home shipments accounted for just 7.3 percent of sales in 2007, now they have 7.8 percent.
The Manufactured Housing Association for Regulatory Reform, a DC lobbying group that represents smaller producers, puts the blame on HUD. In a July release, MHARR says that:
This sustained twelve years decline continues to take its toll on the industry’s small businesses and, more so, on the industry’s post-production sector comprised of retailers, communities, finance and service providers. Without an exclusive and independent national representation, these entities have taken the hardest hit with the current and upcoming impediments that are at the roof of the industry’s continuing decline during the past decade. This, added to the impediments created by regulators’ foot-dragging to fully and properly implement key reform provisions of the landmark 2000 housing law (Manufactured Housing Improvement Act of 2000), has drastically slowed-down any robust recovery for the industry and consumers of affordable housing.
MHARR wants HUD to use its pre-emption power to over ride efforts by states to govern how manufactured housing is shipped into their back yard. Industry desires uniformity, just as banks claim to want a national regulatory standard, in order to create economies of scale. But some would say that they also want to use pre-emption as a blunt tool to quash higher (or more expensive) housing standards. There is a concern right now about states and municipalities that require sprinklers in homes. The issue before HUD is whether those smaller levels of government can insist that homes have sprinklers.
The industry will soon face more regulatory scrutiny. The CFPB wants to have rule-making authority over larger participants within the manufactured housing industry that sell homes or provide financing. There should be plenty of political force behind their efforts. Certainly, consumer advocates will support it. It is also going to come from Holly Petraeus (wife of General David Petraeus) who is leading the division within the CFPB that looks out for the interests of military service members.
