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Residents Purchasing Their MHC

Amid an affordable housing crisis, some states are looking to help low-income residents stay in their homes by helping them purchase the land their manufactured housing sits on.

More than 20 million Americans live in manufactured housing, according to the Manufactured Housing Institute, a trade association. With the average single-section manufactured home clocking in at just over $86,000, many residents cite affordability as the primary reason for purchasing the housing.

But while people may own these homes, they typically rent the land the buildings sit on. Just like any rental, those monthly payments are subject to rent increases as determined by the property owners. Last year, the average increase was just over 6%, according to the Manufactured Housing Institute, compared to 12% for new apartment tenants and 3.5% for apartment tenants who renewed their leases.

To ward off the trend, mobile park communities across the county have formed cooperatives in order to purchase the properties themselves. On Monday, Golden Hills Mobile Home Park became the 311th community to be purchased by its residents and the sixth in Colorado, according to ROC USA. These communities have a high success rate, Bradley said. So far, none have defaulted on their loan, declared bankruptcy or sold the property back to the private market. That may be, in part, because in the long run monthly payments are more stable compared to rents paid to private owners.

Governments at all levels have been mobilizing in recent years to better support residents of manufactured housing, especially low-income households.

In total, 19 states have so-called right to first refusal laws, according to the Manufactured Housing Institute. These laws vary across states. For instance, in some cases they only apply when the land for sale would be converted to something other than a manufactured housing property.

They also vary in how much they benefit tenants, Bradley said. In Washington state, the penalty for owners who don’t give residents enough time to organize is almost negligible, and sellers can just increase the property price to cover those fees.

This post is 99% excerpts from an article by Molly Bolan, Assistant Editor, Route Fifty. See entire article here

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