Affordable Housing vs Low-Income Housing

There is lots of talk these days about the need for more affordable housing in the Southern California region.  It is important to recognize the difference between “low-income” housing and “affordable” housing. 

Low-income housing is subsidized by the government.  There are several projects throughout the region that are monitored by local government housing authorities.  An on-line search or call to the regional housing authorities will provide a list of available low-income housing rental projects.  Some projects are for veterans, seniors and others for all-ages.  There are also low-income for-sale housing projects sponsored by housing authorities and by organizations like Habitat for Humanity.

In these low-income housing developments, renters or home buyers must meet strict income guidelines.  Only low-income can qualify to live in these developments.  The income is determined by the income of the entire family and includes funds in the bank and investments.

Affordable housing, on the other hand, is not limited to low-income renters or purchasers.  There is no limit to the amount of income a person or family has.  It is their choice to live in the available affordable housing.  Apartments, condominiums, and mobile home parks/manufactured housing communities are considered affordable housing stock in the various individual jurisdictions housing elements. 

Mobile home Parks/Manufactured Housing Communities, offer a lifestyle choice that attracts a wide range of renters and buyers.  Mobile Home Park residents are both home owners and renters.  They own the mobile home or manufactured home and rent the site or lot within a Mobile Home Park to locate their home.  The Park is a little city that provides all of the services and facilities.  The owner of the Park is responsible, just like a city, to maintain the streets, utility systems, public areas and facilities. 

Living in Mobile Home Park is a lifestyle choice, not necessarily an income driven decision.  Residents living in Parks may be high income retirees or may have moderate incomes.  Many Mobile Home Parks are senior housing communities and attract seniors who are down-sizing after selling a home. 

Other Parks are attractive to families because, unlike an apartment and many condominiums, most lots/sites rented in a Mobile Home Park have yards, patios, and parking spaces adjacent to the home.  In addition, these communities often offer many amenities such as a clubhouse and pool, which are attractive to both seniors and families.

There is no doubt that the cost of housing in many areas of Southern California is higher than many other regions.  Inland counties such as Riverside and San Bernardino, a region referred to as the Inland Empire, offer considerably more reasonable housing than most areas of coastal Orange County, as an example.  While rents in a typical Orange County Mobile Home Park may be over $1,000 a month, a similar Park in areas of the Inland Empire rents are as low as $400 a month. 

In conclusion, when Cities and other government agencies are talking about the need for more affordable housing, they are NOT referring to building more Mobile Home Parks or Manufactured Housing Communities because on the same amount of land they can build many more units.  They are talking about and planning to build more and more high-rise apartments or condominiums. 

Living in a mobile home park provides a unique lifestyle for all ages and all income groups.

Constraints On Manufactured Housing Impact Production Numbers

In August 2020, data from the US Department of Housing and Urban Development (HUD) showed a decline in production of HUD Code manufactured homes for the third year in a row. This year’s decrease is likely linked to COVID-19 health concerns and lockdowns. However, while other areas of the housing industry have shown a rebound, manufactured housing production faces challenges due to zoning restrictions and consumer financing constraints. Though September 2020 production reports did show an increase over those from September 2019, the cumulative production at the end of September 2020 is down 1% compared to the same period in 2019.

Mobile Home Owners Are Smart They Enjoy Very Affordable Housing

The vast majority of manufactured home owners living in mobile home park communities in the Southern California region own their homes free and clear. They have either lived in the home long enough to have paid it off or they paid cash when they purchased the home. The only housing costs they have are the utilities, home maintenance, and the rent payment for the land and services provided by the mobile home park where they live.

A typical manufactured home has three bedrooms, two baths, small yard, and covered parking for two cars within a few steps of their home’s door. The mobile home park community where they reside provides amenities such as a clubhouse, pool, spa, and on-site management. Some parks have storage areas for recreational vehicles and other storage.

Living in a mobile home park is a very affordable single family detached dwelling lifestyle choice when compared to the average cost of renting a similar size of apartment with limited parking and privacy. However, it is important to remember that, like other rental housing living, mobile home owners as renters will also receive annual rent increases. Unique to mobile home park communities are long tern leases that spell out annual rent increases for many years to come, which provides mobile home owners the ability to plan for future expenses. n

Is Mobile Home Community Living Low-Income Housing?

In the Southern California region, there is a broad choice of housing ranging from very affordable to very expensive. Generally, multifamily rental housing, including mobile home parks, are considered to be affordable housing. However, the closer the apartments or mobile home parks are located to the beach or other desirable neighborhoods, the more expensive they are. Likewise, the farther inland or in less desirable neighborhoods, the less expensive all forms of housing become. The very same 800 square foot 1940’s bungalow located in San Bernardino will rent for a mere fraction of what it rents in Newport Beach. The real estate adage, “location, location, location” applies to all forms of housing.

Generally multi-family rental housing is considered affordable housing and mobile home parks are included in that category. It is important to note that there is a big difference between “affordable housing” and “low-income housing.” Affordable housing is available to everyone as a lifestyle choice, regardless of one’s income. It is very common to find people choosing to live in a nice apartment community or mobile home community because they like the lifestyle. It has nothing to do with whether they could afford to live in a larger or more expensive house.

Low-income housing is another type of housing entirely. To address the needs of low-income families, government has provided a variety of programs including Section 8 rent subsidy programs and other subsidized housing. To live in a subsidized low-income apartment or condominium the renter or purchaser has to meet the low-income criteria.

Cities are required to adopt housing elements identifying the types of housing in their communities. The number of single family homes, condos, apartments, mobile home parks and subsidized low-income housing is outlined in these housing elements. Many cities and counties have adopted zoning requirements that require developers to include affordable housing within their housing developments or to pay the jurisdiction a fee for affordable housing.

Apartments and mobile home parks are not low-income housing. They provide a rental housing choice that, depending on the location, can also be an affordable housing choice.

Affordable Housing and Rising Rents

Sometimes it seems as though affordable housing is hard to find and rents seem to be on the rise.  Of course, the term “affordable” is subjective to begin with and it is easy to point the finger at the “greedy landlord”, but what is truly behind the lack of affordable housing and what is affordable housing?

First there is government regulated affordable housing, which limits the price of the housing (sale price or rent) and the income of the people who purchase or rent the “affordable” unit.  There are cost and income controls on these units.  Government may build these units and private developers may build them in exchange for various incentives.  In California every city that had a redevelopment agency had to set aside funds to build affordable housing for low-income buyers and renters.

Other types of housing that are generally referred to as affordable are privately owned properties that are not regulated by government.  Apartments in some areas generally fall into the “affordable” housing category because they do not cost as much as a site built homes in the area and because there are no requirements to put down a deposit and to qualify for a home loan – i.e. apartments are more “affordable”.

Overall, there are some general reasons why there seems to be a lack of real affordable housing (requiring restrictions on costs and incomes) to rent and to purchase.  As an example:

  1. Lending for affordable housing is scarce. Most lending institutions will not provide funding for such projects, this means developers must turn to private investors who with the current economic state are holding onto their pockets very tightly.
  2. The permitting process is long and clouded. Not only must they pass all required inspections, Affordable housing projects must move through a public input process before permits can be granted.
  3. Zoning restrictions may also impede affordable housing development. Many areas are zoned for other uses and it takes time and a lot of maneuvering through red tape in order for land to be re-zoned.
  4. Some cities have an affordable housing budget but it is not being utilized. San Francisco will have an estimated $20.6 million in affordable housing fees as of June 30, 2013. That is enough to finance up to 4,000 affordable housing units. Only 106 have been completed, 70 are under construction.