Mobile Home Park Residents Have Options

If you are a tenant living in a mobile home park, you face greater uncertainty that most homeowners and even most renters. Since many parks are located in suburban or urban areas with increasing land values, your current park owner could sell the park to a private developer who plans to close it down, change its land use, and force you to move. If this is a possibility now, or you want to be prepared for the future, there are alternatives that will give you control over your park.

In a few states mobile home park residents have created cooperative organizations to purchase the land and manage their park. In other states, tenants have worked with a nonprofit organization which helps the group purchase the park and holds it in trust for the tenants.

In both these options, the park has been removed from the for-profit sector making it less likely that rents would increase as frequently. In addition, the new ownership structure provides increased security of tenure and control over decisions that directly effect the mobile home park residents.

In deciding if either alternative is worth pursuing, there are a number of issues you need to understand before moving forward.

If you are looking at a cooperative model
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A mobile home park cooperative arises when residents decide they want to own and operate their park as cooperative members of a nonprofit organization. With the purchase of the park, each cooperative member owns one share of the corporation. A Board of Directors is elected from the members to manage the cooperative. The Board can decide to run the day to day operations or hire a management company to take on certain responsibilities like making monthly mortgage payments for the cooperative land purchase, paying property taxes on the land, paying insurance, or making major repairs like the replacement of septic systems.

The Board with the support of its coop members creates the policies, procedures, and park rules that impact the daily living situation.

Mobile home park residents who have purchased the park land under a cooperative structure have greater control over eviction, rents, maintenance, improvements, selling of homes, rules and regulations, and services. The major challenge with this option is finding the technical and legal assistance to work with the residents in the creation of the cooperative and assistance with financing for the purchase of the park. In addition, creating a cooperative requires a dedicated group of residents that volunteer to serve on the Board of Directors to make sure that the park runs smoothly and efficiently. Consumers Union hopes to put together a coalition of groups to provide technical assistance to tenants in Texas manufactured home communities in the next year. Keep an eye on this web site for developments.

If you decide to contact a nonprofit organization

Look for a local nonprofit housing development organization that already manages rental housing. Meet with the Executive Director and see if the organization would be interested in purchasing the park. If so work with their staff in providing as much information as possible on the site. If the park is up for sale or the owner may be selling soon, see if the organization can call and find out the selling price. That can give the nonprofit a general idea of the funds needed to purchase the park. The organization will then have to conduct a feasibility study and market analysis to see whether the price makes economic sense. The park residents should also meet with residents living in projects owned and/or managed by the nonprofit to gather first-hand information on the organization. If all things fall into place, the owner may be willing to sell to the nonprofit, the nonprofit may be able to get the financing, and the residents can work with the nonprofit organization on policies and procedures at the mobile home park.

Nonprofit ownership benefits residents because the nonprofit limits rent increases to actual increases in the cost of operating the community. Residents enjoy a greater say in management and operation decisions. Like cooperative ownership, the park is less likely to be closed down and more likely to stay a mobile home park. With that kind of security, homes are easier to sell and the community is more attractive to new residents.

If you would like to pursue a cooperative or nonprofit ownership for your mobile home park, here are some resources:

For cooperative ownership see "Tenant to Owner" manual produced by the New Hampshire Community Loan Fund. For more information on them go to their web site at www.nhclf.org.

Note: Additional materials to be added as they are developed.