Nacced 36th annual conference and training september 20 2011
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NACCED 36th Annual Conference and Training September 20, 2011. Manufactured Housing – A Critical Affordable Housing & Asset Building Resource. Join. Engage. Deliver. Presentation Goals. Frame the challenges facing manufactured housing (MH) as an affordable housing solution.

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NACCED 36th Annual Conference and Training September 20, 2011

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Nacced 36th annual conference and training september 20 2011

NACCED 36th Annual Conference and Training September 20, 2011

Manufactured Housing –A Critical Affordable Housing & Asset Building Resource

  • Join. Engage. Deliver.

Presentation goals

Presentation Goals

  • Frame the challenges facing manufactured housing (MH) as an affordable housing solution.

  • Discuss an unprecedented opportunity to leverage a groundbreaking public/private partnership.

  • Who is Next Step and how can we help nonprofits across the country deliver affordable housing at scale.

The challenges

The Challenges

  • While MH is home to 17 million Americans, many challenges face this affordable housing solution.

  • The market system which produces and finances these homes doesn’t always lead to the best wealth/asset building strategy.

  • Nearly 2 million pre-1976 mobile homes (the year the HUD Code went into effect) still exist nationwide.

  • Nonprofit developers need greater control, predictability of costs, and green choices to meet their affordable housing missions.



Our vision is putting sustainable homeownership within reach of everyone, while transforming the manufactured housing industry one home at a time.

Our expanded vision

Our Expanded Vision

When Asked a Simple Question:What if we were the MH retailer and we could take everything that was wrong with the home and the loan and make it right?

We Asked a Bigger Question: What would it take to replace or retrofit every pre-1976 mobile home with an ENERGY STAR home by 2030?

Next step strategy

Next Step Strategy

Our strategy is to build a national distribution system to deliver high quality, energy efficient, factory built housing at scale, allowing nonprofits to help homeowners achieve wealth by growing equity, preserving assets and replacing substandard mobile homes with new ENERGY STAR homes.

The current distribution system

The Current Distribution System

Another way nonprofit intervention distribution system

Another Way - Nonprofit Intervention Distribution System

Next Step


Theory of change

Theory of Change

  • Our theory of change is understanding that when you get the home done right every single time -

    • On the right foundation

    • Providing comprehensive homebuyer support

    • With the right financing

  • You can create an opportunity for that asset class/loan to perform identically to its site built cousin.

  • To scale this, we had to group demand with a standardized product at a higher quality level; then negotiate with a single provider with national coverage. Thus we bring wholesale pricing to the nonprofits acting as the developers in their own communities.

Our system affordable housing done right

Our System..Affordable Housing Done Right

  • The Next Step System –

  • Homebuyers who are prepared and supported through certified homebuyer education programs;

  • 2. Quality, ENERGY STAR homes on FHA Title II permanent foundations;

  • 3. Life-cycle pricing that is transparent to the nonprofit and ultimately to the customer;

  • 4. Sustainable financing: mortgages with fair terms that enable families to earn wealth or preserve assets; and,

  • 5. “A Home is a Home” policy commitment advocating that owners ofmanufactured homes have the same rights as owners of site-built homes.

How financing affects the development process

How Financing Affects the Development Process

  • What is an FHA Title II Foundation?

  • A type of HUD FHA insured loan for manufactured housing—Real Estate Mortgage for homes on permanent foundations approved to FHA standards and by a structural engineer. (Title I is for Chattel finance and with no permanent foundation)

  • Meets highest quality standard for permanent foundation—meets all lender requirements.

  • Next Step foundation requirements on all homes.

  • Must meet all standards and be on a permanent foundation in compliancewith the Permanent Foundation Guide for Manufactured Housing.

  • A licensed professional engineer's seal and signature (certification) arerequired to indicate compliance with the Foundation Guide.

  • The lender should furnish the appraiser with a design engineer's inspection of the foundation prior to the appraisal.


Doing it right every single time

Doing it right every single time…

A nationwide problem

A Nationwide Problem

Why should we replace mobile homes

Why should we replace mobile homes?

  • By replacing pre-1976 homes nationwide:

  • Households can save an average of $1,800 per year in energy costs, savings that could be better applied to offsetting the new home monthly mortgage costs and therefore building equity.

  • Nationwide savings of more than $240 million a year in reduced energy costs.

  • Reduction in greenhouse gasses of 1.4 million tons.

  • Add demand for new jobs.

Mrs kelly s frightening utility bill

Mrs. Kelly’s Frightening Utility Bill

Mrs kelly s dream home

Mrs. Kelly’s Dream Home

Existing efforts

Existing Efforts

  • NeighborWorksMontana received $350,000 to fund a pilot program for the decommissioning and replacement of older mobile homes. The study identified nearly 30,000 pre-1976 manufactured homes in Montana, for which the costs of weatherization often exceeded the value of the home.

  • Maine Housing operates a mobile home replacement program that incorporates an ENERGY STAR mortgage product. Maine’s program will track energy savings created by replacement efforts.

  • Affordable Housing Alliance, New Jersey is replacing pre-1976 units in Eatontown with ENERGY STAR units as part of the state’s affordable housing initiative.

  • New York recently created a HOME program that commits $5 million to replace pre-HUD homes with ENERGY STAR rated manufactured homes.

Decommissioning process

Decommissioning Process

  • Decommissioning is required with all mobile homes that were built during and prior to 1976, before the HUD Code established higher safety standards. It is strongly recommended that decommissioning of units built after 1976 be a decision made by the developer.

    • Structure

    • Foundation

    • Mechanical

    • Health & Safety

Aluminum Exterior Side Walls

Arched Roof

Dry-Stacked Piers resting on soil (no concrete)

Poor Energy Efficiency

Improper Ventilation

Improper Wiring

Substandard Conditions

Poor Building Materials

Decommissioning process1

Decommissioning Process

Prior to Decommissioning you must first complete the following steps:

Step 1 – Asbestos Testing

Step 2 – Lead Based Paint Testing

Step 3 – “Junk” the Title to the Home

Step 4 – Follow all recommendations from the Asbestos & Lead Based Paint Test

Step 5 – Check local jurisdiction to see if a permit is required for decommissioning

Peeling paint may be lead based.

Decommissioning process2

Decommissioning Process

  • Demolition of the Unit….

  • Typically on site demolition is preferred

  • Recycle as much of the unit as possible

    • Aluminum (Roof, Sidewalls, Wiring)

    • Wood (Framing, Walls, Trusses, Floor)

    • Steel (Steel I-Beams)

    • Onsite Dumpster for all other Debris

Our business strategy

Our Business Strategy

  • Products -

    • Higher Quality, ENERGY STAR Homes

    • Green Modular Home Collection

    • Green Multi-family Modular

  • Benefits of Membership -

    • Favorable Wholesale Pricing

    • Greater predictability in managing construction time and costs.

    • A strong brand built on the promise of doing it right.

Our partnership with clayton homes

Our Partnership with Clayton Homes

  • Next Step Network signed a strategic alliance with Clayton Homes to offer Next Step Homes exclusively to our Network.

  • Negotiated a national buyers group exclusive to nonprofit network.

  • Nonprofits with financial, organizational and development capacity can join the Network.

  • Once trained, they can order homes directly from the factory at wholesale prices.

  • An opportunity for nonprofit members to create sustainable business lines, with lower overhead, speed and greater efficiencies.

Home building facilities

Home Building Facilities

Next step developed homes

Next Step™ Developed Homes

Next Step™ worked with Clayton Homes to develop a special line of homes, sold exclusively to the Network Members at wholesale prices.

While maintaining the efficiencies of construction in a home building facility, we can provide flexibility with both manufactured and modular versions of most homes and customization for thermal and wind requirements. We have floor plans and exterior styles that fit lifestyles across the US.

Factory built options

Factory Built Options

Single Family Manufactured & Modular Options

  • ENERGY STAR Qualified

  • High Quality Construction

  • Affordable Price Points

  • Wholesale & Transparent Pricing

Standard features

Standard Features

  • Base Options -

  • 2 x 6 Exterior Walls-2 x 4 Interior Walls

  • R-22 Floor Insulation

  • R-19 Wall Insulation

  • R-40 Ceiling Insulation


Next step homes

Next Step Homes

The Bel-Air – 3BR, 2 Bath, 1,264 sq. ft. $51,500

Next step homes1

Next Step Homes

The Stacey II - 3BR, 2Bath, 1,264 sq. ft. $56,800

Next step homes2

Next Step Homes

The Discovery – 3BR, 2Bath, 960 sq. ft. $34,500

Next step homes3

Next Step Homes

The Cottage - 3BR, 2Bath, 1,396 sq. ft., $59,700

Next step homes4

Next Step Homes

The Aspen – 4BR, 2 Bath, 1,580 sq. ft. $60,800

Next step homes5

Next Step Homes

The Wilson – 3BR, 2Bath, 1,580 sq. ft. $63,900

Next step homes6

Next Step Homes

The Discovery – 3BR, 2Bath, 960 sq. ft. $34,500

Factory built options1

Factory Built Options

  • Multi-Family Modular Options -

  • Custom Multi-Family Construction Available.

  • Tax Credit Projects.

  • ENERGY STAR Qualified Construction.

  • Green Building Construction Techniques.

Modern design options

Modern Design Options

Other Options…



Coming Soon – Mod 2.0e . . .

Benefits of factory built housing

Benefits of Factory Built Housing

  • Affordable, Greener Choice for Community Development

  • Factory-built homes reduce housing prices because they leverage bulk purchasing of goods and centralized systems for building.

  • Even with new economic pressures, low and moderate income individuals and families can still achieve the stability of home-ownership.

  • The factory built process is inherently a greener process. Built in a central location with less waste (demonstrated waste in a single garbage can).

  • Controlled development process, quicker time cycles with predictable costs ideal for managing community development projects. Very suitable for infill development.

Green collection our future

Green Collection - Our Future

  • The Next Step™ Green Line of Modular Homes

  • Conceptual rendering

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