Whether you’re Republican or Democrat, there are some issues that are not in question. One is that we are facing a growing element of America that cannot afford traditional housing options. There are 10,000 people PER DAY who are retiring and converting to living on meager social security and tiny pensions. The average retiring American worker will be living on around $2,000 per month. And the number of American families living on $30,000 per year or less is now around 50% of our total population. It doesn’t matter who wins the election, the surge of demand for low-cost housing is going to continue to grow far greater than the supply can possible absorb.
What happened here?
Traditional housing options grew in price at unprecedented levels. The average single-family home in the U.S. is now around $200,000. And the average apartment rent in the U.S. is over $1,000 per month. To afford these prices, based on the U.S. government standards on affordability, you would have to earn around $50,000 per year. At the same time, the income of Americans has declined, such that 50% of our country earns only about half that amount. That’s the same half who is on social programs, and most of the same 47% that pay no taxes.
What is “affordable housing”?
Simply that – housing that people can afford. If you earn $30,000 per year or less, then your total housing budget is around $500 per month. Clearly, that’s not going to put a roof over your head in traditional housing options. But it can in a mobile home park. In a typical mobile home park, you can get a 3/2 mobile home for $500 per month, including lot rent. This is the only form of detached housing that can offer these type of prices. And for that half of American society, this is the only way that can ever have the American dream of home ownership.
So why can’t the government do anything about fixing this problem?
The government has failed to improve the incomes for virtually all Americans. And the giant retirement numbers for the baby boomers would erode any improvement, anyway. The fact of the matter is that there is going to be a giant part of our society – maybe more than 50% in the near future – that has to seek affordable housing. In addition, virtually every city in the U.S. does not allow the construction of new mobile home parks. Why? Because such a development would require new mobile home park zoning, and nobody wants to zone land for mobile home park use. Every neighbor turns out to argue against such zoning, and the city father’s know who elects them and immediately bail on the concept. In the entire U.S. last year, there were less than 10 new mobile home parks built.
Conclusion
Watching the Presidential debates is fun. Talking about the candidates is a great conversation starter. Wondering about the impact on the financial and world markets of one candidate over the other is interesting. But at the end of the day, whether it’s Obama or Romney, the only clear winner is affordable housing. Because it doesn’t really matter who wins the election on November 4th. All that matters is if you own a mobile home park. Because if you do, regardless of the outcome, you’re in great shape. If you own an insurance company, on the other hand …