Investment firms buy trailer parks, squeeze them for profit

Mobile homes as a share of each county's housing units as of 2017. Washington Post map; click the image to enlarge it.

Mobile-home parks are a critical source of affordable housing, especially in rural areas. Increasingly, investment companies are buying them up and, in efforts to extract maximum profits, making it harder for the poor to afford living in them.

About 20 million Americans, many seniors, veterans, and people with disabilities, live in mobile homes. Manufactured housing, common in rural America, is one of the largest sources of unsubsidized low-income housing in the U.S. Sheelah Kolhatkar reports for The New Yorker. 

"According to a report by the National Low Income Housing Coalition, there isn’t a single American state in which a person working full time for minimum wage can afford a one-bedroom apartment at the fair-market rent. Demand for subsidized housing far exceeds supply, and in many parts of the country mobile-home parks offer the most affordable private-market options," Kolhatkar reports. "In the past decade, as income inequality has risen, sophisticated investors have turned to mobile-home parks as a growing market. They see the parks as reliable sources of passive income—assets that generate steady returns and require little effort to maintain. Several of the world’s largest investment-services firms, such as the Blackstone Group, Apollo Global Management, and Stockbridge Capital Group, or the funds that they manage, have spent billions of dollars to buy mobile-home communities from independent owners."

Absentee investors that buy mobile-home parks often extract more profit by raising the rent on lots, charging residents for services that were once included, and requiring residents to be responsible for more upkeep on the grounds. One seminar for potential trailer-park owners, Mobile Home University, "recommended that owners regularly raise rents, but not so much that it would drive out desirable tenants," Kolhatkar reports. "They also told investors to avoid 'tenant-friendly' states such as California and New York, where evictions can take months, and urged them to concentrate on areas where there is a shortage of reasonably priced rental apartments." 

Esther Sullivan, author of Manufactured Insecurity: Mobile Home Parks and Americans' Tenuous Right to Place, attended one of the seminars and told Kolhatkar its advice can be summarized as: "Look for a park that’s got high occupancy and that doesn’t need a lot of investment. Take out any possible amenity you’d ever need to invest in, such as a playground or a pool that’s going to need insurance. Make sure it’s got a nice sign, and pawn off any maintenance costs onto your tenants." HBO's John Oliver was more frank, describing the program as "a crash course in how to be an asshole."

Because mobile-home dwellers usually own their home but rent the land it sits on, they're often excluded from basic legal protections for renters, Kolhatkar reports. In theory, such residents can simply move their home if they don't like conditions in a trailer park, but in practice it can cost as much as $10,000 to move a mobile home, leaving residents hostage to predatory lot owners. Some states have passed laws closing those loopholes, but trailer-park residents in many states remain vulnerable.