Video Transcription
We have an industry update for Sarasota!
Both traditional and mobile home prices all across the US have shot up at new levels and continue to rise, to the point that now some researchers and economists indicate that they have seen signs that a real estate bubble is brewing.
Mobile housing prices increase faster than market forces would indicate that they should do so and are “derailing from the foundations”, according to a new blog post that wrote researchers and economists from the Federal Reserve Bank of Dallas.
Until recently, the possibility of a bubble did not have very wide support. But, after observing the US real estate markets, Fed researchers indicated that new evidence is appearing.
Mobile housing prices in Texas and Florida could increase 20% or more this year, but black families have difficulty benefiting from it
“Our evidence points to an abnormal behavior of the US mobile housing market for the first time from the outbreak of the early 2000s,” the researchers wrote. “The reasons for concern are clear in certain economic indicators that show signs that mobile housing prices in 2021 seem to be increasingly out of tune with the foundations,” they added.
Many Americans are still marked by the last real estate crisis in 2007. A situation that promoted cheap credits and lax credit standards that turned out that millions of owners owe more for their homes than they could pay.
But this time, economists said they are worried about a different scenario.
The Federal Reserve warns that problems in China’s real estate sector could have an impact on the United States economy and world markets.
The fact that housing prices increase uncontrollably does not always mean that there is a real estate bubble. And there are many reasons why housing prices have constantly increased during the last decade and fiddled even more significantly in the last two years. Among them, are the imbalances of supply and demand in the market, the increase in labor and construction costs, and how high or low-interest rates for traditional mortgages are, the researchers said.
Meanwhile, the demand for mobile homes increased nearly matching the traditional single-family homes. Considering that, the beginnings of housing in single-family homes, in 1.11 million units according to the Seasonally Adjusted Annual Rate (SAAR) in the second quarter of 2021, and the beginnings of mobile housing were 167,000 units (SAAR) in the second quarter, which is 9% greater than the previous quarter, and 55% greater than the same quarter of the previous year.
In addition, the inventory of mobile homes in the market has increased for both new and used mobile homes. The inventory listing new mobile homes for sale at the end of the second quarter was 148,000 units based on seasonal adjustments (SA). Which has a growth rate of more than 14% from the first quarter of 2021. In addition, it registered a growth of 16% compared to the previous year.
Currently, there are several mobile home parks within the Sarasota area that are foregoing the application fee associated with the park approval process!
This equates to nice savings for anyone who is looking to get approved by a mobile home park within Sarasota.
Many times it is asked if it is even necessary for one to get approved by the park prior to purchasing a mobile home, and the answer is a resounding
YES!!
The mobile home park approval process is, for the most part, pretty straightforward.
Most parks in the Sarasota area will require the applicant to fill out a standard application with their information on it. After the standard application is filled out, most parks will also ask for a photo ID, run a credit report, a criminal background check, and an eviction history report on all applicants trying to gain access to the park for residency.
Verification of income will usually always be done as well.
Each park varies its criteria needed for approval, but most are looking to make sure that each application does not have any prior evictions on their record.
The reason for this is that when buying a mobile home within a mobile home park where the tenant leases the land the home sits on, that tenant will be required to make a monthly payment to the park in the form of lot rent.
If the tenant has past eviction history due to failure of payment, the park could use this as a basis for the reason for not approving the applicant for residency within the mobile home park.
Most parks will charge an application fee of $50 to $100 per applicant.
Currently, there are several parks that are waiving this fee within the Sarasota area as a way to make the buying process that much more affordable to all buyers involved.
After speaking to several park managers, I have heard that this has been done for those who have financially been affected by the loss of wages due to the pandemic of COVID-19.
I feel this is a very generous gesture made by the park managers and owners since running a full background check does cost them money to do. I expect to see several other parks in the Sarasota area continue waiving the park approval application fee as everyone gets back to normal post the global pandemic.
This is Mark Kaiser with The Mobile Home Dealer, and we help mobile home buyers and sellers get to a better place in life.
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