Question:
Do you have any suggestions on adapting the data directly from your platform and into something I could apply to mobile home parks? Or, do you find the mobile home parks are close enough to normal SFR that the data should apply the same?
Ken's answer:
Mobile Home values closely correlate with SFR in each market. In terms of sensitivity to market changes/cycles, here's how I'd rank them (most sensitive/volatile first):
- Land
- Mobile Home Parks (MHP)
- Single Family Residential (SFR)
- Multi-family (MF)
Land is typically the first to drop and the last to rise, with more severe percentage declines than SFR; MHP comes next.
I haven't run a formal correlation for MHP vs. SFR, because there aren't enough MHP sale transactions in a given quarter/market to generate accurate market-by-market comparisons (same problem as commercial real estate). But here's the cool part: years ago I was able to get CRE data for a few very large metros and correlate it to HousingAlerts — and even though no accurate quarterly CRE price data exists at the metro level, our SFR data works as a very good proxy (and gives more lead time, since CRE lags SFR). Every anecdotal MHP data set I've seen correlated closely to SFR — I believe the MHP↔SFR correlation is even tighter than MF, though SFR may lag MHP a bit, as it does for land (all the more reason to watch HousingAlerts closely).
In the meantime, use the SFR cycles as a close proxy for MHP cycles — read a market's Market Outlook and Wealth Phase and treat it as your MHP market indicator.