It's a whole new world

mobile home university
41

I have been giving much thought to the state of our niche and many of the players in it. My choice of the word “apathy” may not have been entirely correct and I am not yet certain I have found a word the correctly and completely defines what I am seeing and experiencing both in my business as much in others.

First let me say that much of my concern is not born of my own strife. My properties have remained rented, at least all of those that are available. I have 3 projects that I am working on but none of those were expected to be completed and available in the short term.

My concerns are based upon what I see happening to people that I respect in this niche and to those in other business ventures who have been affected by the economy, by the credit crisis, the government

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The feeling of scarcity becomes overbearing to me

I will NEVER find better words to describe my EXACT feelings on this subject…very, very well said.

Regards,

Greg

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Good evening, Tony

Remember, about eighteen months ago, we spent two truly memorable evenings in Asheville with a number of compatriots discussing the past, the then present and extrapolated the future socio-economic environment of our industry. It was a learning experience for me. As we exchanged ideas,we probably reflected on our own situation. We talked about rational preparations which we could begin immediately to minimize potential losses,

exposure to unnecessary obligations and generally secure the hatch before we try to ride out the most devastating storm of our lifetime.From Don and Karen(NY) I got the idea that small can be beautiful (I still owe them a lunch or dinner),from you and Scott I learned that a d.w. on a lot has no competition from a s.w. in a park or on land. Because I had experience with s.f. homes and multiple units complexes, the advise made sense and we acted accordingly. We are still pursuing that model successfully. Subsequently,especially towards the end of 2008, a number of posts addressed the same subjects. It would be interesting to hear from those who did make appropriate preparation for themselves ; what did they accomplish? I believe that Steve was seriously de-leveraging his portfolio. Because I am somewhat of a cynic, I believe that most are still in denial of reality.Recently, I read about the five phases a typical investor will go through: Denial- “This can’t be happening.”

Denial-“This can’t be happening.”

Denial-“This can’t be happening.”

Denial-“This can’t be happening.”

Denial-“This can’t be happening.”

Denial-“This can’t be happening.”

That last glass of wine may have been a bit excessive.

May you and your family be healthy and prosper.

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Bernd you said

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Mike, I apologize for being slow in answering your post.

During 2007/08, in an effort to educate ourselves, reading Lonnie Scruggs

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Hey Keith,

the IRS no longer considers the loss you describe on residential property. Investment real estate doesn’t get the same protection.

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This is an interesting read I ran into the other day that is something for investors to keep in mind when they are sitting on either side of the table.

http://finance.yahoo.com/news/Mortgage-lenders-pursue-cnnm-3107909798.html?x=0

Tony Colella

Post Edited (02-11-10 16:12)

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Tony,

The way I’ve been dealing with this economy is to just put my head down and work as hard as I can. Dropping rental prices as low as necessary, doing triage on homes that come back, selling a few of them at a loss to reduce carrying costs. Putting in more expensive floors that will last through a few tenant/buyer cycles instead of carpet.

For me, I’m just not where I expected to be by now, but thankfully I built a lot of slop into my finances so I’m okay, and have not had any problems paying investors (knock wood). Don’t use banks, so haven’t had issues with that. Haven’t even looked at my credit rating in 2 years because it isn’t relevant.

We’ve cut back on spending A LOT in my household- no more eating out, no more movies, drop gym memberships, cut out non-essentials at the grocery store. We don’t heat our condo, just wear lots of clothes when at home (thermal inertia in the building means it never gets lower than 60), and we are saving water by taking very short showers and flushing less. It’s not that we absolutely need to do these things, it’s just that if feels wasteful not to do them. I spent $3000 getting my 16-year old car new brakes and tires back in November and was glad to be able to pay for it out of pocket.

One of the ways I misjudged the economy was that I thought we’d get lots of people moving down to mobile homes, I thought MHs were recession-proof, but what is happening is people are moving from their houses in with family. We are now getting folks who are at their wit’s ends from living with family, and have saved a little money, so that’s good. But have not seen much influx of people moving down to MHs from losing their stick-built houses to foreclosure.

Luckily for me, the investors I interact with most closely here in GA are doing well, keeping close track of their numbers, and are very realistic in their expectations, not at all apathetic. I do everything I can to stay positive and focused.

I actually think we might have hit rock bottom in Monroe, because many of my people have new jobs, and good jobs at that. In fact I’ve had a few people move out because they wanted a house with land. Although I was sad to see good payors leave, I see it as a sign that things are looking up, and being able to fill those MHs fast reinforces that notion.

All in all, we are hanging in there and I look for 2010 to be the year things turn a significant corner for me.

Anne

49

Tony,

That article doesn’t surprise me at all. I would be very nervous about turning the keys in when I have visible assets. However , from what I’ve heard is that the lenders in many non recourse states are issueing 1099’s for the amount of the shortage. I know this is becoming a crazy world but they can’t have it both way. If someone gets a 1099 that would mean the debt is cancelled. The banks cant write it off and then collect later. Nor could they make someone pay taxes on the forgiven amount if they were still liable for the shortfall.

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I hadn’t intended to imply that banks could 1099 and seek a deficiency judgment enforcement at a later date. I merely found the article interesting and the idea that so many folks today who have sold their homes via short sale or had their homes foreclosed may finally get back on their feet financially only to be informed they still owe a large sum of money because of the deficiency and now their new assets are at risk.

Tony

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The rich man walks and the poor boy pays. Nothing new here. The Utube post that Cole posted will get your attention about the rich mans power in this country. Gotta Love It. All of us with some beans left on the table should feel fortunate. I keep the thought in mind that the goverment folks are always trying to take my beans away. Life is good for the aware

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Tony,

I didn’t mean to imply that you didn’t understand the process. I was just commenting on the fact that most lenders were sending 1099’s and the article never mentions that. I think if one is dealing in a non recourse state and found that the lenders there were sending 1099’s , he could be a little more comfortabe with planning “life there after.” But as I said , I would be very nervous about handing the keys over if I still had visible assets. I also wonder how mortgage ins. would play into this picture ?

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Agree

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This thread was a great read.

One thing I try to keep in mind when running (and keeping) my parks is the fundamental act of gaining wealth. Not just my wealth, but the wealth of my customers. It only makes sense that if my customers are gaining (or retaining) wealth, they will continue to be able to pay me.

I heard much advice during the “good years” to do things like greatly increase the lot rent in parks. Another piece of advice i heard a lot was to greatly increase the length of loans, “because the buyer did not even ask” how long the note was for.

Even with morality aside, I would argue that not taking that advise has been good for my biz. I do not do loans for over 5 years. I print out amortization schedules and give them to the buyer so the can see the wealth they are gaining each month.

I also keep my lot rents moderately low.

My customers enjoy home ownership and therefor are generally able to pay me. I am generally willing to change the amount of the payment if a customer has been having troubles paying.

I have averaged 95% occupancy over the last 2 years of “economic uncertainty” I am able to directly manage 84 lots and a self storage unit in less then 40 hours a week. I contribute much of this to getting good customers, treating them well but firm, and helping them gain wealth in home ownership.

If my customers are succeeding I will succeed. It sounds so simple yet I think its often overlooked and it is more important now than ever.

Thank you to everyone for the great reads.

Briton (IN)

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Greg, Anne, Steve, Rick, Mike, Ben, et al. -

We would love to hear how the year is shaping up for you all. We’ve been blessed that things are still strong in Oklahoma (so far). We’ve not had a ‘bust’ because we never had a ‘boom’ to come down from. Things have just continued to grow at a moderate pace.

I know many of you were hoping for an upturn by now in your parts of the country, and I wonder if it’s happened…?

Best,

-jl-

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I don’t know why this thread seems to have been bumped. But since it has, does anyone know whatever happened to Greg Meade? He was a really great guy

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I don’t know, but reading through the old posts has really got me thinking about risk management.

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I too appreciated the old posts above. They provided me with valuable information and are eye opening. Thanks to those who have gracefully given their time on this forum and continue to do so.

Have a wonderful, happy and peaceful year ahead everyone.

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