WASHINGTON—U.S. Rep. Cindy Axne is pushing for tenants’ rights to extend to residents of manufactured housing communities to protect them from predatory rent hikes.
The Iowa Democrat introduced two pieces of legislation last week. One bill aims to establish a set of minimum standards and protections for tenants of manufactured housing communities, which are typically single or multifamily homes built elsewhere and installed to a site, that receive federal financing through Fannie Mae, Freddie Mac, or the Federal Housing Administration.
The other is a reintroduced bill that aims to keep manufactured housing communities “affordable by providing federal assistance for acquiring and preserving these communities,” through purchases by non-profits or local groups.
“Owners of manufactured housing communities get federal backing to buy these properties, and then they turn around and only care about squeezing profits out of older Americans, folks living on fixed incomes, and families who don’t have the same protections as other tenants do in similar circumstances,” Axne said in a statement.
Iowa lawmakers tried last year and again this year to advance a bill protecting rights of mobile home residents.
Axne said that her constituents in manufactured housing communities in Waukee were hit with 70% in rent hikes from a Utah-based real estate investment firm, Havenpark Capital. She argued that if her constituents are receiving federal funds for housing, they should qualify for tenant protections.
Havenpark has defended its practices by saying its purpose is to preserve affordable housing, not destroy it, and that any rent increases are necessary to bring properties up to standard.
Sen. Sherrod Brown, an Ohio Democrat and chair of the Senate Banking, Housing and Urban Affairs Committee, has also expressed concern with private-equity groups that own manufactured housing communities and increase rents.
Brown wrote a letter in early January 2020 to Fannie Mae and Freddie Mac —government sponsored enterprises—requesting data on private equity-owned manufactured housing communities.
“I have seen first-hand how residents in these communities, many of whom are elderly and have fixed incomes, have experienced rent and other housing cost increases with few consumer protections,” he said.
“The information I am requesting here will help me better understand Fannie Mae’s role in financing private equity-owned MHC properties and what resident protections, if any, are included in the Enterprise’s financing process.”
More than 22 million Americans live in manufactured housing. It provides an affordable housing option, given that the average cost of a manufactured home is $78,500, according to Manufactured Housing Institute, a trade organization representing the industry. And there are more than 40,000 land lease communities for manufactured housing.
A 2018 study by the North Carolina School of Government found that manufactured housing made up 12.7% of the state’s housing stock. Meanwhile, advocates representing low and moderate income households say that the industry is a source of frequent consumer complaints and abuse — both with respect to sales practices and the leasing of lots.
The Manufactured Housing Institute spent $830,783 in lobbying last year, according to the Center for Responsive Politics.
The first Axne bill, the “Manufactured Housing Tenant’s Bill of Rights” would require residents to receive a 60-day written notice of any rent increase or new added charges such as water or sewage.
It would also give residents a one-year renewal lease “absent good cause for nonrenewal and protection from evictions without cause” and the right for a tenant to sell a home without having to relocate it. Residents would also be given 60 days advance notice of a planned sale or closure of a manufactured housing community.
“In order to ensure tenants living in communities covered by these protections are aware of their rights, the bill also requires that the list of properties where these protections are in place is posted publicly,” Axne said. “The legislation also lays out penalties for any property owner that fails to meet these standards, including compensation for the residents who were harmed.”
The second bill, the “Manufactured Housing Community Preservation Act,” would help “create a new grant program to help nonprofits, resident-formed cooperatives, and other local entities purchase and maintain an MHC through awards of up to $1 million,” according to a release by Axne.
She first introduced the bill in January 2020. The measure would also create an oversight provision to “ensure rents remain affordable for residents after purchase by grant recipients.”
“Providing residents of our manufactured housing communities a pathway to acquiring their own community through a co-op or partnering with a nonprofit will help ensure we can keep these communities affordable for this and future generations of tenants,” Axne said.