Owning a house on a lot where someone else controls the rent is problematic.
We live on a leased lot in a Georgia State Park. Fortunately, the lease extends about 80 years at this point, and we know how much the annual lot lease will be - currently about $500 a year. The previous 99 year lease was renewed and extended by the Park Authority, so even 80 years from now, the odds are, the owners would not be thrown out.
Of course, there are other expenses we have, even with the house "paid for." Insurance, property taxes, utilities, fire fee, and so on and so forth, come to about $800 to $1000 a month. Pretty cheap living, but of course, we don't have a mortgage.
Mark has been looking at real estate in Florida, and is amazed how cheap some places are. You can buy a modular home on a lot for not a lot. Other places offer "mobile homes" for sale in a trailer park, where you don't own the lot, but rather rent it from some company. And it can be an advantage to be beholden to some landlord like that. Landlords can make decisions - hard decisions - that homeowner's associations or condo associations will dither and dicker about for decades.
On the other hand, as we've seen, trailer parks can get rundown, as the owners get older and lose energy. They don't raise the rents on the lots, as they see the tenants as their friends. So their friends overlook the cracked pavement and worn-down swimming pool. The owners die or retire and a new owner who took a course at Trailer Park U. buys the place and doubles the rent overnight. Seniors living on Social Security and just getting by, freak out. And those old trailers are so rusted they can't be moved - and the cost of moving one exceeds its retail value. It can cost thousands to move a mobile home.
Mark saw one place with units for sale - in an over-55 community - and was amazed that the prices varied from under $10,000 to over $100,000. The answer, of course, was that these were trailers, and trailers depreciate over time. The $10,000 double-wide was from 1983. The $100,000 modular was from 2018. We drove by the place - totally by accident - and saw a line of 50 residents with protest signs, complaining about conditions, management, and lack of security. What was going on here?
I googled the name of the park and the residents have been protesting since 2013, it seems. I also looked for reviews online, and someone has been busy as there are many recent no-comment five-star reviews, or reviews from people who seem to do nothing but review things - giving everything all five-stars. One reviewer admitted they didn't live there but had a friend-of-a-friend who does, and she said it was nice. Grooming the Internet. You are dealing with a clever landlord!
Now whether conditions are as bad as all that is up for debate. I suspect the real issue is the monthly lot rent, which I read on one listing was $689 while one of the protesters claims it is closer to $900 a month - plus utilities and water, which apparently the latter of which was included at one time. So you see why they are protesting - it is costing them more per month to live in a trailer than I pay to live in a three-bedroom house with a garage.
A lot of the complaints seemed trivial - worn pool loungers, the occasional pothole. I think the money was the issue. When someone says, "it isn't about the money..." it is about the money.
I wrote about trailer parks before and how they can be a trap. You buy the trailer and then rent a lot to put it on. Once the trailer is there, it isn't leaving - ever. Some parks make you cut off the trailer tongue with a torch, just to make sure. So if they raise the lot rent, you basically have to suck it up and pay, or walk away from the trailer you paid for. Even the latter is problematic, as the landlord can charge you to have it removed or cut up and hauled away. In a way, it is like a timeshare - a lifetime commitment. You have to hope you can sell it to some other chump, which is why older trailers sell for next to nothing.
And maybe, if you are broke and need a place to say, buying an $8000 worn-out trailer is not such a bad deal, even though you are paying $1000 a month for lot lease and utilities and so on and so forth. It is approaching the cost of an apartment, without the luxury of having a landlord pay for plumbing repairs. Of course, that is just the problem - as these parks get older, they require refreshing. The pavement cracks (paving sand is an exercise in faith) and the swimming pool needs an overhaul every ten years or so. What seemed shiny and new to the original owners, starts to look run-down. And $8000 trailers start to attract the wrong sort of people. Pretty soon you have a crime problem, and run-down cars with no mufflers on them, racing through the streets. It isn't an issue of poor management, but an issue of the inevitable process that occurs with trailer parks, as the parks get older and the trailers get older.
Contrast this with free-standing homes, which can last 50-100 years or more, and can be updated and remodeled (which of course, is a PITA as well). Although, eventually, they too, will be bulldozed and replaced when the time is right.
And that could be another factor in these protests. Since the park was built (apparently in the 1980's) the area has grown and the land is worth a lot more. A builder would see that land as valuable building lots. Evict the tenants, get rid of the trailers, and you've got a million-dollar home gated retirement community - or at least a $500,000 one. So it could very well be that the landlord wants these people to get disgusted and leave - as it is cheaper than buying them out. Could be - merely speculation on my part. It has been known to happen, and is the battle-plan of the Trailer Park U. crowd.
Yes, we can argue it is "unfair" and that sumptin' should be done about it. Problem is, what these park operators do isn't illegal, and indeed, to suggest that someone shouldn't be allowed to do something with land they own is sort of un-American (doesn't mean it isn't a popular trope in parts of the Northeast!). The deal is, of course, that you can't get stung by these things if you don't sign up for them. Mark marvels at "how cheap" these homes are in Florida, but then I point out to him that the yearly lot lease would exceed the purchase price of some of these units. Better off to pay a little more and own a piece of land to dump your trailer on, if you have to. Of course, some others don't have that choice.
But speaking of cost-of-living in Florida, insurance is the new big kicker (next to property taxes, which can easily be in five-digits in many parts). Seems the lawyers pushed through legislation that allows them to collect huge fees by suing insurance companies on behalf of "clients" whose homes are damaged by hurricanes. Roving roofing companies, affiliated with law firms, look for clients after a storm and convince them they are entitled to a new roof - at Cadillac prices - and then go after the insurance company, who refuses to buy a gold-plated roof when the damage is limited to two shingles.
As a result, insurance costs are skyrocketing in Florida - double-digit increases every year. Bear in mind the wind policy on Mark's parent's house in Ft. Meyers Beach was over $4000 a year (in addition to the homeowner's policy) and you can see this becomes a major expense.
That is the problem with these "pro-teckt the Little People!" laws, such as rent control and tenants rights. Sounds great in the abstract, until the bill comes due. People today are protesting to have rent abolished entirely. Gee, I wonder how that will work out? Most landlords are small operators who have mortgages (such as I was) and with no rental income, will lose the property. And by the way, in bankruptcy, your eviction protections are nearly zilch. Oh, well, people never learn.
Maybe some day, we'll downsize to one of these trailer deals. But quite frankly, it appears to me it would cost more than what we are paying now - and not be as nice.
There's no place like home! And sometimes you have to leave home to find that out.
