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Street Talk

Mobile Home University has a website (mobilehomeuniveristy.com). You should read it. It is a great primer on the business end of trailer parks. There’s a real good chance you’re going to be much more familiar with trailer parks, because plans are to put lots and lots of trailers in Water Valley. Imagine a sea of trailers, 29 acres worth. Note that is a more than slight upward correction here, it was first reported it was 20 acres. So maybe you should know a little bit about the business. Because it is about business. Good businesses, in theory, for the owners of the park, pretty much a bad business for everyone else. 

Trailers parks are a good business if you’re betting on a poorer America. It is possible to get richer from people having a hard time. The Golden Wing guys’ best-case scenario to profit from us is there will be more and more poorer people. That’s good for them. 

What is not said is the bulk of local taxpayers effectively subsidized these for profit real estate ventures. Subsidize with tax dollars in a number of ways by a disproportionate police, fire, roads, water and sewer use. Our system of taxing based on appraised value means the tax base on a trailer park is not much. So the majority of people in the middle-income range get the squeeze and the park owners get richer.

In a section of MHU’s website titled “Why you should never build a mobile home park” Frank Rolfe, who owns about 100 parks in 16 states, says “People ask us all the time why, since…we are extremely bullish on the industry, we don’t build new ones (parks)… The truth is we would never build a new park from scratch. We don’t recommend that anyone does….let us explain why that is not hypocritical.”

Frank goes on to list the reasons. Reason one; you can’t build in decent locations today. He says virtually every American city no longer allows new parks. All the good locations were taken 30 years ago. So one must build way out in the county, where nobody can block your project. Opps, the Golden Wing guys found a location. Scratch reason one.

Reason two; you can’t get municipal water and sewer. Golden Wing found land right next to the Water Department. And the sewer lagoons are nearby. Scratch reason two.

Reason three; you can’t fill lots without buying the trailers. Correct, almost nobody will bring a trailer to your park. If they own a trailer they will find their own acre or two.  So the park owner must buy repo homes and perhaps new ones to fill the lots. Golden Wing is in luck, lots of trailers around and many for sale. It is estimated there are one thousand trailers spread about in this county alone. Semi-scratch reason three.

Reasons four to six; can’t get financing, under occupied parks are illiquid, and can’t make money because the bank interest takes the profit. That’s all true if you are borrowing big money from a bank to build a park. But these guys are medical professionals or business owners. They are not hurting. Scratch reasons four to six.

Frank Rolfe says after listing these six reasons “Building a new mobile home park is just a bad idea.” This from a guy who owns 100 parks.

Looks like Water Valley is that rare situation from the perspective of investors, a behind the times good place for a new large trailer park.

And all this is not a dig at people who really need affordable housing. Trailers are seemingly affordable, but the trailer park business practice is for maximum dollar extraction with minimal input. Some people admire that ability. They think that’s what America is all about, the freedom to make money regardless. If you put pure economic extraction in first place pretty soon there is no lasting value in the community. It is like strip-mining the money from a place. What’s left is a scared wasteland.

And for all this talk about trailers, this is not a diatribe about people who live in trailers. Hardly. It is a question of values and housing and quality and wealth. As for housing there is plenty in the city already. The Water Valley Housing Authority has 200 units, most well built brick duplexes.  If you factor an average of 2.5 people per unit, that’s 500 people living in rent adjusted housing. Or about 15 percent of the town’s population.  Most towns don’t have near that much; we’re well over HUD norms in that respect. 

As for value and quality, the current housing looks pretty sturdy and well built and as good looking as any housing development I’ve ever seen. I know as I live really nearby and pass by them several times a day.

And wealth, that housing works on a percentage of income and allows a person to save, if they wish, enough funds to maybe buy a house of their own. And gain some equity or stored wealth in a house. Ever heard of trailer gaining equity or appreciating? 

The only elected official that has come publicly out against the trailer invasion is Sheriff Lance Humphreys. The rest seem fence sitting or silent. Let’s hope they are working on this for our sake.

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