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Palmdale Saves Mobile Home Parks

Case Story

In spring 1997 through a bond issuance, the City of Palmdale’s Housing Authority acquired the Boulders Mobile Home Parks, which comprised 750 unit spaces in several locations. The parks were in danger of being taken into receivership because of their negative financial situation.

The city was concerned that the parks’ large number of low- and lower income households could be displaced from their mobile homes if the parks continued to decline. At the time of acquisition, the parks had an occupancy rate of 75 percent, which was declining each month.

The challenges were how to operate the parks in a fiscally responsible manner and to reverse the increasing vacancy rate, create new affordable home sales and change the poor image of the parks. In addition, within the manufactured housing industry, the city hoped to change the perception that the Boulders Mobile Home Parks were not a preferred place to live or do business.

Four Steps to Success

To do that, a number of major changes needed to be implemented, including:

  • Developing a program to assist low- and lower income first-time homebuyers, as well as low- and lower income senior and/or disabled residents.
  • Successfully marketing the parks. The housing staff spent many hours explaining to various lenders the commitment level the city had to the parks. Several lenders were encouraged and concluded that, if the city was willing to invest in an aggressive down payment assistance program, they too would commit to working with the parks again.
  • Turning the parks over to the city Housing Authority, which would retain a professional management company specializing in the manufactured housing industry.
  • Creating a specific position for a full-time Housing Authority staff member who would directly oversee the operation of the three parks. This housing coordinator would not only oversee the operating budgets and long-term capital improvement projects, but would also act as a liaison to the residents on behalf of the city Housing Authority.

The city council approved the steps, and the city Housing Authority took ownership of the three parks. Housing staff started implementing the programs and services necessary to attract and approve new homebuyers.

The Manufactured Housing Mortgage Assistance Program was born. Lenders and mobile home dealers began to market the program, and within two years more than 225 new mobile homes were situated in the three parks. As of today, the parks are completely full - with a waiting list.

Successful Results

Within two years, the occupancy rate for all three parks went from 67 to 100 percent. During 2003, the three Boulders Mobile Home Parks had the highest infill activity in any of the state’s 2,500 mobile home parks.

Home values in the three parks have also risen to all-time highs. The resale price of existing homes went from $10,000 to $20,000 to $60,000 to $80,000 and is now more than $100,000. Homes that at one time were worth less than the loan value have appreciated enough to show a degree of equity within the market values for the area.

Blight that once plagued the parks is now gone with many attractive new homes filling the formerly empty spaces. The management company quickly addressed concerns about retaining walls, broken utilities and poorly kept homes. Crime and the criminal element that once dominated the parks are now gone, replaced by families and responsible homeowners.

The financial strain the parks created on the housing fund has been eased. Monthly rents collected have increased, and the parks now meet their financial obligation without draining the housing set-aside fund. Rents have stabilized at affordable levels and nearly 100 spaces are being offered at reduced rents.

Five hundred twenty-five affordable homes were protected, and 225 affordable homes were created. In addition, 120 families, who would have never had a chance to own their own homes, took advantage of the down payment assistance program and are now homeowners.

Residents of the parks have been empowered by two tenants being appointed to the city Housing Authority and the city forming and supporting homeowners’ associations at the parks. Finally, the once blighted, financially troubled mobile home parks are now clean, safe, affordable and very desirable residential communities.

 

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