Trends Watch: Manufactured Housing
January 06, 2022
By Elana Margulies-Snyderman
EisnerAmper’s Trends Watch is a weekly entry to our Alternative Investments Intelligence blog, featuring the views and insights of executives from alternative investment firms. If you’re interested in being featured, please contact Elana Margulies-Snyderman.
This week, Elana talks with Ridaa Murad, Founder, Habitat Homes.
What is your outlook for investing in manufactured housing?
We believe and the data shows that the affordable housing needs are dramatically rising over the coming decade. A shortage of new supply and low existing inventories on one end coupled with stagnating wages and rising cost of home ownership and a low yield environment for those on fixed incomes/savings is creating a scenario where we expect the segment to tremendously outperform other segments.
Where do you see the greatest opportunities and why?
We see tremendous opportunity in the Southeast markets due to multiple favorable conditions. We are seeing a population migration to these areas (Florida, South Carolina, Tennessee, North Carolina and Georgia) due to lower taxes, friendlier business operating environments, cheaper cost of living, lower regulations and better year-round climates. We are also seeing opportunities to acquire in these markets which remain less "picked off" and ripe for institutional aggregation.
What are the greatest challenges you face and why?
On-ground operating expertise, property management challenges, COVID-19 related regulations and restrictions, and changes in regulatory environments remain challenges that all operators will face in the coming years. Each of these items can lead to kinks in the operating metrics and the performance of each investment. The additional diligence required and the increased operating wherewithal required will separate good and bad operators in the coming years and it will separate the newcomers from the proven operators in this upcoming period.
What keeps you up at night?
As a fiduciary, we worry about every bit of minutia of each of our investments, but we have created a process-based system which operates well and has performed under extreme cyclicality and changing environments and proven extremely resilient. We haven't missed a quarterly payment since our launch and these combined give us enough comfort to be able to sleep, albeit with one eye open!!
The views and opinions expressed above are of the interviewee only, and do not/are not intended to reflect the views of EisnerAmper.