Mobile Homes: Last Week Tonight with John Oliver (HBO)

mobile homes perfected by humans but invented by snails there are many misconceptions about mobile or manufactured homes for instance right now you may be picturing something that looks like this but for decades the industry has been trying to change that image running ads like this one you bought a mobile home today's manufactured home factory build quality at a price that makes sense we have three big bedrooms [Music] today's manufactured home you bottomed out okay I think I'll get it but for the record that sexy saxophone riff would make a reveal of anything seem good here I'll show you you bought a taxidermy fox [Music] [Applause] box but but it is it is true in history it can be genuinely hard to tell the difference between manufactured homes and conventional homes just like it's hard to tell the difference between Jessica Chastain and Bryce Dallas Howard the difference is like a mobile home Bryce Dallas Howard is assembled off-site than placed on wheels and moved to her permanent location around 20 million people live in mobile homes that's roughly one in eighteen Americans and they're one of America's last affordable housing options costing up to 50% less per square foot than a conventional house which is great but in recent years some of the biggest investors in America have moved into this industry according to one new report over a hundred thousand home sites traditionally run by mom-and-pop businesses are now owned or partly owned by private equity firms like these so the homes of some of the poorest people in America are getting snapped up by some of the richest people in America and luckily there'll be no problems whatsoever except I'm obviously kidding it's going terribly if you do want to hear me lie about stories to make you feel better you might enjoy our spin-off show everything's fine with John Oliver did you know Isis is just hamsters this little terrorist name is dumpling and he doesn't even know how to use his gun sadly back in the real world the truth is the rise of big-money investors in mobile homes has led to a corresponding spike in rents fees and local news stories like these people living at a local mobile home park outraged over the sharp increase in lot rent rents were raised by as much as 36% rents were raised by nearly 60% Ella Carter lives on a fixed income her lot rents just gone up and it all adds up to a bill she can't afford now it's a matter of okay now which medication am I going to take and half so that I can make a stretch out a little bit longer that's clearly horrible because nobody should be made to stretch out medicine it's sad enough when you stretch out your almost empty bottle of shampoo by adding a bunch of water and if you didn't relate to that joke you haven't suffered a single day in your life so tonight tonight let's take a look at the mobile home industry let's start with the company that sells more mobile homes than any other Clayton Homes controlled by one of the richest men in America Warren Buffett's although the company's ads choose to feature a more down-home spokesman what do I know about Clayton Homes I know they're built right here in America and they know the difference between a house and a home hey miss Kay a home is where you get your famous sweet potato powder honey and y'all know how we all try to make miss Kay happy happy happy clean homes good call judging by that creepy delivery there's just no way that getting her famous sweet potato pie is not also code for some kind of disgusting sex act it probably means miss case smearing pie filling on his ball sack while a live duck scraped it off with his bill and if it does good call but but the key difference between a mobile and a conventional home has nothing to do with pie it has to do with how it retains its value just listen to finance guru Dave Ramsey give his no-nonsense take on whether or not you should buy one mobile homes go down in value it's the only thing you own that you live in that goes down in value even if you buy dirt under it that goes up and value more than it goes down in value so it appears you didn't lose money you lost money you buy a $50,000 mobile home in a few years it's a $10,000 mobile home I mean cars go down and buy you mobile homes go down in value it's a car you sleep in I'm gonna say I find the negativity of his tongue genuinely refreshing there that guy should replace Jim Cramer on his show no more running around excitedly pressing buttons like a little boy at an arcade just an angry old grump hunched over a desk telling you you're going to lose money so so mobile homes may be a terrible investment for people buying them but they've been an incredible investment for Warren Buffett's Clayton Homes generated pre-tax earnings of nine hundred and eleven million dollars last year and they've done that not just by selling homes but by financing them as well because instead of being financed with mortgages mobile homes tend to be bought with high interest short chattel loans the kanji used to buy a car or a TV and an investigation a few years back found Clayton relies on predatory sales practices exorbitant fees and interest rates that can exceed 15% trapping many buyers in loans they can't afford now Clayton strenuously denies all of that saying the report was based on isolated incidents and that its customers reports high levels of satisfaction although I will point out that one of those isolated incidents was this call a Clayton customer got when she fell behind on payments what do you suggest except for the things that you already suggest which doesn't work holy-shit go donate blood I guess one way to get your customers to report high levels of satisfaction is to make sure they're all feeling lightheaded after you literally bleed them dry but but one of the biggest problems here isn't even to do with how you pay for a mobile home or how quickly it loses its value it's where you put it because around a third of mobile home dwellers owned their homes but don't own the land underneath it that's because they live in mobile home parks and pay rent on that land to the park owner but in recent years large investors have been snatching those parks up and either tearing them down or ratcheting up rent and fees as these women experienced firsthand the end-all family decided to sell the park and they sold it to the Carlyle Group first of all Carlyle started off with an immediate 8% increase space rent so that was a threat to most of us who are living on fixed income I don't know what's gonna happen I may be forced to leave everything like doctors my friends the life I've known here even though I own my own it's true that woman may lose her home so the Carlyle Group an investment firm with 216 billion dollars in assets can make more money for their shareholders if the concept of income in equality came to life that is the sentence it would scream when it orgasms now Carlisle Carlisle insists that the price heights were to pay for park improvements which makes complete sense if you ask these why they got into private equity I'm sure they say to you Oh to break-even on investments in the beautification of affordable housing why else would we do this I also apparently have to tell you that Carlisle has a safety net program for low-income residents although you should know it only applies to 21 of the 800 Lots in that park so it's a safety net that only catches 3% of people just like the one they use at my favorite circus a pile of dead trapeze artists it's fun for the whole family unless you're a family of one of those trapeze artists and if you think it well look that's terrible but if those women live in mobile homes why don't they just move well there is a problem with that as one of those women will tell you although they call them mobile homes it would cost twenty thousand to move this home out here plus it went once you move them in and they settle moving a mouth couldn't help destroy them she's right it can cost thousands of dollars to move mobile homes if you can move them at all that is why 80% of mobile homes never move so mobile homes are mobile about as much as a king crab is an actual king it's just not except in some parts of Alaska where it wills the power of a despot but even then it constitutionally shares power with moose Parliament so so King is really a more ceremonial title there Alaska's a fascinating place and this this lack of mobility for tenants is actually part of the attraction for big investors and to see just how cynical and predatory the industry can be meet Frank Rolfe his company is one of the largest park operators in the u.s. controlling over 30,000 home sites in 25 states Roth is an evangelist for the wonders of mobile home park investing just look at this uplifting message that he made ahead of the 2012 election about what it would mean for his industry taped for some reason in front of a shitty green-screen Oval Office if Mitt Romney wins things are good but if Barrack Obama wins things are good you see it doesn't much matter who wins the election all that matters is that the statistics show that Americans will continue to get poorer in that lower half of the population Wow what president wet webcam is essentially saying there is no matter what happens the poor will suffer and we will feast on their rich marrow and as you can see it's casual Friday here at the White House which is why I sit before you looking like a divorced dad at a parent-teacher conference Roth is completely shameless about the degree to which his business depends on having a captive customer base positively comparing it to running a Waffle House where everyone is chained to the booths a concept so deeply chilling I think it may have just inspired jaws and peels next movie now now you should know Ralph maintains that that line was taken out of context in fact he has a whole page on his website about it claiming he was just talking about the incredibly consistent revenues in mobile home parks so he wasn't suggesting that he's a heartless person whose customers are stuck there with him holding all the cards deciding for himself how high he wants their rent to go to see him say that you'd need to enroll in his online mobile home university which we did and found seminars like this but I found it again just as a heartless person is that you know the customers are stuck there they don't have any option they can't afford to move the trailer they don't have three grand so they're the only way they can they can object to your Rhett raises to walk off and leave the trailer in which case it becomes abandoned property and you recycle if another person in it so you really hold all the cards so the question is what do you want to do how high do you want to go Wow usually when someone is that contemptuous of poor people there immediately visited by the ghost of Christmas future now now maybe maybe Roth will claim that that quote is out of context - and that he's not arguing that they're hostages to hear him say that you need to send away for Roth's audio seminar on running mobile home parks which we also did and found thick's were the big drivers to making money is is the ability increased the RET we didn't have them hostage if they weren't stuck in those homes and though in the mobile home labs it'd be a whole different picture Frank rolls mobile home university is basically a crash course in how to be an although having taken that course I'd argue that if that's what you're looking for save your money and just follow Piers Morgan on Twitter for one afternoon isn't just online if you attend his mobile home bootcamp he'll even take you on a field trip to love a park when you get to the park you'll be shocked and turned off by for example the beach towel in the window instead of an actual curtain that doesn't mean anything well you got to worry about are the following items infrastructure density expense age of home and location got it they're teaching people about mobile home parks oh yeah that's good no it isn't done it's really not good telling that woman that people are just there to learn about mobile home parks is like telling a lobster people came to the restaurant to learn about crustacean habitats that's good are those knives and forks to help remove these tiny rubber bands from her claws no they're going to eat you so with that woman and many mobile home residents like her in danger of having their lives turned upside down it is worth asking is there anything that can be done here well one potential solution is for residents to band together and buy their own Park keeping it out of the hands of speculators or developers and while that sounds inherently like a long shot there are nonprofit groups that have had real success in helping tenants get financing to do just that what would help is to have laws in every state that give residents the right of first refusal and time to raise funds if the current owner plans to sell but until laws like that are put in place which they absolutely should be there are some key things to bear in mind if you want to rent a mobile home that's fine if you can afford to buy one and put it on land that you own that's fine but buying a mobile home and renting the land underneath it can be financially catastrophic and it is very important that anyone considering doing that knows the risks involved and I'll tell you what would have been helpful all along if the marketing for these homes had always made those risks completely clear you bought a mobile home today's manufactured home I can't believe you bought a house I really did it it's exactly like a house and what a beautiful piece of land I don't own the land though and that's actually a super important difference look at you all grown up with the mortgage it's a chat alone with an astronomical interest rate the important thing is it's an investment in your future it'll actually only ever go down in value and since the private equity firm bought the park my rent has skyrocketed are you listening to me oh I love these decorative bottles oh that's my blood I have to sell my blood and plasma in order to make loan payments [Applause] but home is where the sweet potato pie is I didn't make that did you make that is that burning your hands are you a witch I want to see your garden no no no no don't don't look out there here I go do it oh there she is look she can't afford to move you hold all the cards he's right it's like a Waffle House where I am chained to my booth that's house delicious what is wrong with you speaking of delicious you [Applause] you

Channel: LastWeekTonight

Views: 9,316,812

Keywords:

Id: jCC8fPQOaxU

Length: 15min 39sec (939 seconds)

Published: Sun Apr 07 2019

Reddit Comments

[u/pattsully]

Just looking up news about mobile homes after watching brings up a story from two days ago from Iowa where a mobile home park was fighting a 69% rent increase after the park was recently bought by Havenpark Capital, a company that owns mobile home parks across the US.

The story said that city legislators were going to look into the issue, but almost doubling rent in any area is fucked up.

[u/Cirenione]

It's almost impressive how sinister and clever the whole idea is. Keeping them chained to a location through a big up front payment while (not so) slowly raising the rent for the ground below. It's like people thought they weren't ready yet to sell heroin to children yet so they want to start a few steps below.

[u/fergeek]

In 1999 the residents of my park got together and bought the park from the government who repossessed it from a pimp who owed the IRS millions and skipped the country to Brazil. Our lot 'rent' is $110 a month but it's just too cover the cost of maintaining the park since we are a non profit group.

[u/Klugenshmirtz]

Frank Rolfe is not shy about being the worst human he could possible be. How can you say something so horrifying and obviously be proud of it?

[u/Pontus_Pilates]

Off topic: with that final motherfucker I realized that they used to censor the language of their youtube uploads. Not anymore.

The ad was great though.

[u/Skadoosh_it]

This one really hit home for me. Up until last year my family had rented out a manufactured home for 5 years. The old couple who owned the park sold it, and it was bought by some random LLC. They raised my rent from $975 to $1400 in one year. That really strained us to the point of crippling debt, and we and everyone else in the park ended up being evicted so they could half ass remodel the homes, sell them for way above their value, and charge space rent. After paying off my debts it finally gave me courage to buy a home, though, so I guess there's that.

[u/shelbysnazz]

Me and my man were literally looking At housing options and I’ve been leaning towards manufactured homes, because it’s so much cheaper. This is blowing my mind. ( I don’t know why) but I definately needed to see this tonight.

[u/liberal_alien]

Seems to me like a critique of constructing anything on a rental plot. Whatever it is that you own on a rental plot, it will be difficult to sell even at a discount and you can be charged above market rent for the plot because of this.

I suppose the problem will be at it's peak in areas with many elderly fixed income people living on these types of situations, but the incentives remain similar with any other types of tenants.

It doesn't even have to be a scum owner, if the area simply gets developed and the value of the land increases, then even a fair market rate for the plot rent may become impossible for a fixed income tenant to afford.

To take the great expense of constructing a house in a rental plot seems mad to me regardless whether the house is a prefabricated "mobile" home or laid brick by brick. Sure it is cheaper to get started, but you are completely at the owner's mercy. If you had a contract stating something like plot rent follows some cost of living index or some such, then it is a bit safer, but still your running costs will be going up in the future as the rent increases. Contrast this to taking out a loan to buy a plot. Then your plot related interest costs should decrease over time as you pay down the loan.

[u/speedycat2014]

/r/unexpectedJanet