An important subset of all affordable housing in the United States – roughly six percent of the nation’s housing stock – is manufactured housing – essential to some of the lowest-income residents in the country.
Roughly 40 percent of manufactured homes are spread across 45,000 manufactured home communities (MHCs) where residents own their homes, but rent the land their home sits on from a private owner. Many of those communities suffer from aging and deterioration. Others risk rent increases or displacement when the MHC is converted into market-rate homes or an alternative real estate use altogether. Compounding the challenge is that few alternatives exist for low-income households when the cost of rental homes continues to rise.
Against this backdrop, we believe that a successful strategy to preserve MHCs – and support the residents who live there – must present both systems-changing capital, advocacy and policy solutions. Here’s our multi-pronged approach in supporting MHCs:
$20 Million Partnership with ROC USA Capital to Help Scale Resident Ownership of Manufactured Home Communities
Enterprise has committed $20 million to increase ROC USA Capital’s capacity to help residents of MHCs buy – and own – the communities where they live. Made possible through our CDFI, Enterprise Community Loan Fund, the capital commitment will increase ROC USA’s capacity to provide financing for MHC residents seeking to preserve and own their homes. When deployed by ROC USA, the capital is expected to help preserve the affordability of approximately six MHCs, comprising around 400 homes, over the next two years.
ROC USA Capital provides loans to resident-owned communities for community purchases, refinancing or renovations. To date, their loans have converted more than 280 communities to resident ownership and served over 19,000 member households.
“I am extremely pleased that Enterprise and ROC USA Capital will be joining forces to preserve and improve affordable homeownership across the U.S. through the ROC USA resident ownership model for manufactured home communities,” said ROC USA Capital Managing Director Michael Sloss. “The $20 million commitment Enterprise Community Loan Fund has made through a Master Loan Participation relationship will be leveraged with another $6.5 million from ROC USA Capital to deliver fixed rate, 10-year first mortgage loans to lower-income resident corporations purchasing the land beneath their homes. Over two years, this $26.5 million CDFI lending partnership will enable at least 400 lower-income homeowners to achieve the long-term financial security which comes through resident ownership.”
When MHC residents buy their communities, it’s called a resident-owned community (ROC). ROCs are typically accomplished when homeowners form a nonprofit “cooperative.” As ROC USA explains, “Each household is a member of the cooperative, which owns the land and manages the business that is the community. Members continue to own their homes individually and an equal share of the land beneath the entire neighborhood.”
The power of ROCs is that they can put control in the hands of the homeowners giving them: agency over monthly lot rent; community repairs and infrastructure improvements; lifetime security against unfair eviction; and liability protection.
$1 Million State & Local Grant to Advocate for Resident Protections
State and local governments play a pivotal role in ensuring protections for renters and homeowners. That’s why Enterprise is also pleased to announce that we will make $1 million available to support state and local policy and related efforts to provide MHC residents with robust housing protections and to preserve the long-term affordability of this critical housing stock.
Urging Federal Housing Finance Agency (FHFA) to Make Tenant Site Lease Protections Mandatory
Fannie Mae and Freddie Mac (the GSEs) have an important role in making capital available for purchase of MHCs. To protect the rights of MHC residents, Enterprise’s President and CEO, Priscilla Almodovar, urges FHFA to make minimum standards for tenant protections mandatory in any MHC product offered by Fannie Mae and Freddie Mac. In her August 2021 letter, Priscilla noted that, “Today, many residents of MHCs are increasingly vulnerable to rising costs, deteriorating infrastructure, community closures and, worst of all, displacement. This one simple change of making Tenant Site Lease Protections (TSLPs) mandatory on all MHC products offered by the GSEs has the power to improve resident stability and affordability in MHCs.” Read Priscilla’s letter. Read Freddie Mac’s statement affirming MHC tenant protections.
Policy Brief: Preserving the Affordability of Manufactured Homes in Land-Lease Communities
Enterprise has issued a policy brief examining the affordability of manufactured homes and offering additional recommendations. It explores ways in which public and mission-driven stakeholders can support preserving the long-term affordability of MHCs. Read the policy brief.
Policy Center: Investment in a Research Center Committed to Manufactured Housing Research and Policy
We believe raising awareness of the importance of manufactured housing as a high-quality, affordable homeownership option is critical. In this connection, we plan to invest in a research center with the goal to promote the use of manufactured housing to provide wealth-building homeownership opportunities for low-income families. To do this, we will produce and disseminate original research and policy analysis to promote more equitable access to legal protections, housing finance, and the same benefits of homeownership for manufactured homeowners that are enjoyed by owners of site-built homes.
Taken together, these measures will support resident protections in MHCs and, where possible, the right of residents to own the communities where they live—all to make home a place of pride, power and belonging.