Under Roof: Manufactured home ventures in Charleston area weather residential downturn, look to grow
By JIM PARKER
The Post and Courier
Taking a call one day last week, Allen Croft opened with some small talk. Croft was having “a good day selling. But,” he says, “I wish I was out fishing.”
Croft, floor plan source and salesman at Equity Homes in Ladson, realizes the predicament faced by a manufactured housing entrepreneur. When the market is lean, he works to attract buyers. When it’s strong, he stays on the job to keep up momentum.
This year the businessman is witnessing the positive side of the ledger. “It’s been excellent (sales-wise),” he says. “We are 31 percent higher than last year, and that was the best in three years.”
Still, Croft has been around long enough to remember that the manufactured housing market was even more robust 15-20 years ago. As recently as 2007, manufactured homes accounted for 18.2 percent of residences in South Carolina — the highest share in the country.
“In 1997, we sold 986 new homes,” he says. But national home builders have eroded the totals by offering low priced starter houses, Croft says.
After its big season 16 years ago, Equity Homes switched its business formula. “Since then, we haven’t done anything but renovate homes,” he says. The refurbished manufactured houses, which are as large as 2,560 square feet, are priced from $15,000 to $65,000, Croft says. Those payment figures are dramatically below what a shopper would fork out for a similarly sized site-built house or 2013 model manufactured home. For instance, a new 2,500-square-foot manufactured home would be $115,000. “I’ve got a 42 by 80 (foot) for $46,000,” he says.
“People want to get more bang for the buck,” Croft says. “It meets your needs, and (there’s) low maintenance.”
One benefit for manufactured home customers is they have choices. They can buy new homes through a number of name manufacturers in the Charleston area, or they can purchase retailored units via places such as Equity Homes.
Some buyers, notably in more rural areas, install their manufactured homes on their own land. In other cases, people move into manufactured home parks where they can place their purchased unit or rent existing ones.
A surging player in the field of owning and managing manufactured housing neighborhoods is Denver-based YES! Communities, which runs 181 communities in 17 states including South Carolina.
In the Charleston area, the venture bought seven communities from Darby Development in January of last year and picked up three more from ARC in April 2012. Parks range from an 82-site neighborhood in North Charleston to a community in Summerville with 604 manufactured home spots. Other neighborhoods include The Gables and Sweetgrass Estates.
YES! Communities, sporting 46,000 home sites nationwide and 800 employees, posted 300 percent growth as a company in the past five years.
South Carolina has been a great market for us,” says Misty Bishop, marketing manager. “We brought in a lot of capital improvements,” she says.
YES! Communities took its name to counteract what it believes are restrictive practices in the industry that scare away customers, such as “no pets” policies. “We try to say “yes” to customers,” Bishop says.
Another goal is to keep prices low. “We pride ourselves on providing affordable housing,” she says. Many people rent the manufactured homes, and the rates tend to be around $750 to $800 a month.
At the same time, the venture promotes community activities with the goal of fostering neighborliness. “That’s our sweet spot,” Bishop says.
Equity Homes likewise touts customer service. For instance, the business buys most of its pre-owned manufactured homes at auctions but 37 percent stem from individual owners. Even if the sellers don’t go ahead and buy a model from Equity Homes, “we set up” their new manufactured homes, Croft says.
Many customers pick Equity Homes after seeing the “value upgrades” such as residential lighting on all the models. They also can choose from 25 to 30 types of manufactured homes as opposed to the handful of models at new manufacturing dealers, he says.
Croft acknowledges that he couldn’t stay in business refurbishing manufactured homes without a brisk sales output.
“I say this all the time, ‘We are lucky we are a volume dealer,’” he says. The outlet sells up to 18 homes a month, relying on steady business rather than big markups.
“We don’t try to go out and get a home run,” he says.
Reach Jim Parker at 937-5542 or firstname.lastname@example.org.