Let Us Remember

Remembering

On this day, chosen to celebrate the birth of a child of wisdom, a day that grew big enough to include people of all lands and all faiths into a universal embrace of peace and goodwill, let us remember.

Let us remember the lonely who are far from loved ones; let us remember those who are no longer with us but touched us with their love and spirit; let us remember the sick and injured and those who sacrifice this day of celebration to care for them; let us remember all who left a piece of themselves on a foreign battlefield; let us remember those who have no homes filled with lights and ribbons and bows tied around bright bits of love and joy; let us remember the hungry and hopeless; let us remember all who stand just outside the warmth of all Hallmark moments.

Today I celebrate with a woman who spent last year alone in a wheel chair, wondering if she would walk again, wondering if life was worth the effort, and a man who recently lost his wife and finds this time more bitter than sweet.  Together we will watch the story of a man who lost himself in fantasy and remind ourselves to remember sweet times and be grateful for the beauty of this day and the gift of living it.

Let us take this time to remember ... and re-member our spirits, our bodies, our communities and our world. 

What Are the Facts: #1 "18 Inches of Dirt"

Christmas Pumpkins

Last night's HOA meeting was, overall, a gentler meeting than we've experienced in the past. Questions and strong opinions were exchanged and a few new voices were heard.  If we could continue to meet in this manner, we might eventually establish a bedrock of facts that we could all stand on confidently. 

In the meantime though, we still seem to be focused primarily on opinion, fear and speculation. Large, public meetings do not give us enough time to explore thoroughly the facts that these complex questions require. 

I believe we all want the same thing … reliable information that will help us make our own decisions, an understanding of our rights and protections and a sense that we are being treated fairly.  We want to know that none of our neighbors are going to be hurt by the conversion and that we will not lose value in our homes or have our space rents go up beyond the annual increases called for in our leases.

With the hope that we can all begin to separate fact from fallacy, I'm starting a series focused on some of the issues we seem to talk about most and each issue will be a separate post for easy reading.  Please feel free to comment … together we're smarter than any one of us.

FALLACY:  "We're buying 18 inches of dirt."

Words can sometimes lead us astray … this molehill of fact is used to distract us from a mountain of truth.  

Mesa Dunes is a 50-acre mobile home park where almost 40% of the park is devoted to common space, including 2 clubhouses, 2 pools, a BBQ picnic area (with a fabulous view), a playground, green space, walking trails, guest and RV parking space, a laundromat, roads, water system, sewer system and all those "substandard" lights Jeff mentioned last night.

FACT:  Details of the 19.01 acres of common space is spelled out in The Department of Planning and Building New Project Referral document which was posted some time ago on the blog for your review.  Click here to view - page 4.   

FACT:  The "18 inches of dirt" is actually the depth marker of our individual lots … under that 18" lies not only more dirt but also the underground utilities that we all own in common.

Rumor has it that Jeff thinks the price for our "18 inches of dirt" should be in the $60-65K range.  He didn't mention that number last night but did allude to "much lower prices."  Just to be clear, I would gladly vote for him for King if he could pull that price off.  

So far, I have not been able to find even one data point that would let me believe that the reality of lot prices could be anywhere near $60,000.  While fantasy is a wonderful thing, when it comes to financial dealings, I prefer reality.  And, here's the reality I've found:

• Sunrise Terrace … shares (roughly equivalent to lots) $200,000 … years ago the shares started at  about $30,000 … land, or a share in land, tends to go up in value, especially when it's California Coastal real estate.

•  Bolsa Chica (on 227) … land values average $150,000.

•  Rancho Colinga (Morro Bay) … recent corner lot for sale $185,000.

•   Knollwood (Santa Maria) … lots are in the $120,000 - $140,000 range.

•   Pismo Beach (across from beach) … $250,000 for share price, again equivalent to a lot.

Let's negotiate the best prices we can get … but expecting the owners to sell lots for 1/3 of their actual market value just doesn't make sense. 

Affordable Housing

Paddle boarder at Shell Beach

This week's SLO Sunday Tribune features an article "High Housing Prices Lock Many Out of Ownership" stating that a buyer needs an income of at least $100,180 to afford a median priced ($487,500) home in SLO County.  A year ago, 37 percent of homebuyers in the county could afford a median priced home, now only 23 percent can. In spite of that, homes are selling so rapidly that the supply is severely limited.

The article is filled with interesting data, some of which will be listed below.  However, the important information for us here in Mesa Dunes is how this affects our thinking about the value of our homes, both before and after conversion. The primary driver in the change is the supply and demand for housing … right now there is more demand than supply.

South county tends to be more affordable than San Luis Obispo but it's location near the water and temperate climate keep it in the most desirable category.  Right now Oceano has a median price of $356,000 and Grover Beach's median is $382,900.

We've guesstimated that lot prices will fall in the $200,000 range.  With discounts for early purchase, prices could be closer to $175,000.  Add an average price of $100,000 for your coach and the average package price for a home in Mesa Dunes could be in the $275,000 range … or well under the median price range … especially when you consider the location and amenities of our park.  

Of course, if you have a greatly remodeled coach or extensive decking and a view, your home could be worth more, however, it would then compete with higher-end homes and still be attractive.

It's hard to imagine people buying properties in this price range, especially if our home was purchased many years ago.  However, while California real estate went down in 2008 when the building boom created a glut and the economy tanked throwing many people out of jobs and their homes, if I were going to put money on where prices would be ten or fifteen years from now, I wouldn't want to bet against the upward trend.

There are no guarantees in the world of real estate and investments, but this article makes it seem like Mesa Dunes will continue to be affordable housing even after conversion.

Today's Listings in Sunrise Terrace: (where the HOA is $175 per month)

Some people say that Mesa Dunes does not compare to Sunrise Terrace because their amenities are better.  They have lovely amenities and a beautiful club house.  However, if you haven't driven through it, I suggest doing so.  Somehow, it has a sun-baked feel to me and I much prefer Mesa Dunes.  Plus, it is an over-55 park, something I personally do not prefer.

374 Sunrise … $220,900 (with membership), 1440 square feet … probably 1970s unit

378 Sunrise … $174,500, 1440 square feet … probably 1970s unit.  This looks like a great deal.

816 Eaton … $265,000, 1640 square feet … upgraded

820 Innesley … $279,500, 1368 square feet

807 Muirfield … $295,000,  1440 square feet, remodeled and bonus room

350 Sunrise … $319,000, 1570 square feet, remodeled

251 Sunrise … $359,900,  1600 square feet

Taking One Question at a Time

The dunes in bloom.

On a pure numbers basis, the "for conversion" group lost last night at the South County Advisory Council meeting as a hand vote showed about 40 against, 8 for and 8 abstaining.  Of course, most of the park wasn't there to register their opinions one way or the other.

The public comments were passionate and, except for some opening remarks stating that "many people will lose their homes," and characterizing the law firm handling the conversion as "anything but honest," and "downright immoral," most of the comments seemed to be heart-felt statements displaying the spectrum of emotions around this issue … from fear and anxiety to anticipation about the conversion options. 

When it was all said and done the Council reiterated that the owners have the right to sell their property and voted to recommend approval to the Board of Supervisors … with three recommendations (detailed below). Unfortunately those recommendations don't follow state code which carefully prescribes the step-by-step process of conversion.

Metaphors are very powerful and one we've heard a lot was repeated last night: "I wouldn't buy a car if I didn't know the price."  It's a bad metaphor … for one thing a car is actually for sale, our lots aren't.  Right now, we're just going through a process that will turn them into legal real estate that can be purchased a couple of years from now.  The law, and simple fair dealings, require that we be fully informed about the process as soon as it officially begins so that we will have the time required to make our own decisions.

A better metaphor would be building a new house.  Imagine walking into an architect's office and saying, "I might want to build a house.  How much will it cost?"  A whole lot of questions would have to be answered first … how big? what style? when? where? and so on.

Conversion is like that … there are a whole lot of questions that have to be answered before the lots are legally mapped and appraised, the infrastructure evaluated and required reserves calculated, and budgets are drafted to establish homeowners' fees. It's going to take time and a lot of work to answer these questions.  

At this stage of the process, however, the County is tasked with answering two questions in order to deem the conversion application complete:

     Is this a real conversion rather than an attempt to break rent control?  In other words do at least some of the residents actually want to buy their lots? Mesa Dunes only has 36 rent-controlled spaces so we know this is not just a rent control ploy. 

     Is the conversion applicant following all the state and county codes, especially with regard to protection of lower income residents? The owners have filed a Tenant Impact Report with the County outlining the protection for all residents and the basics of how the conversion process will follow the steps determined by code.

The Council listened patiently to the presentations by Susy Forbath and John Wallace as well as the comments of lots of residents and then voted to recommend approval of the application with the following recommendations:

1.  That the planning committee develop and implement a new survey.

We already know some residents want to purchase their lots, assuming the lot prices are fair compared to similar properties.  The first survey demonstrated that and park meetings have confirmed it.  The park could do another survey … but what is the County going to do when only half the residents complete a new survey … just like only half of them completed the first one?  

The original survey had a 55% response rate … somewhere between adequate and good for a mail survey according to the University of Texas's Instructional Assessment Resources.

Are we going to just keep doing surveys until "they" are satisfied?

2.  That the infrastructure is evaluated.

This is a mandated aspect of conversion which was outlined in some detail by both Susy Forbath and John Wallace last night.  However, according to state code, this is done after County approval.  This is not a simple, quick look inspection, it is an in-depth evaluation done by professionals to determine the state of the infrastructure and the level of reserves needed. (See timeline below.)

3.  That the lot prices be made available to the residents.

How can lot prices be determined before there are lots to price?  We don't have legal lots right now … we have rental spaces with guideposts for placing mobile homes. Again, according to state law, lot valuation only happens after the following steps have been done:

• Obtain Application Completeness letter from County (1-6 months);
• Obtain Hearing date from County (1-3 months);
• Provide Tenant Impact Report to all resident household (15 days prior to Hearing);
• Obtain County approval of Tentative Map (1-12 months);
• Prepare and file Final Map Application with County (2-6 months);
• Obtain Completeness letter from County (1-4 months);
• Obtain Hearing date from County (1-3 months);
• Obtain County approval of Final Map (1-6 months);
• Obtain park inspections report (2-4 months)
• Obtain budget for future Homeowners Association and park operations (2-4 months)
• Prepare formation and governing documents for future Homeowners Association;
• Prepare purchase, financing; and transfer documents;
• Obtain lot valuations; 

        (For the full Timeline, click here.)

There are a lot of unknowns in the process of conversion and that uncertainty makes people anxious and fearful.   However, the state and county have spent a lot of time creating codes and processes that rationally and step-by-step answer these questions.

In the meantime, we need to remember that no one has to buy their lots and 263 out of 299 residents have the option of staying on their leases with its current terms and conditions … basically “no impact.”  

And, if you happen to be one of 36 residents not on a lease, talk to Joanne Mancarella about getting one before conversion happens.  You could be pleasantly surprised at how much protection you have available to you.

Important Meeting: Monday, Nov. 25

The first opportunity to present your opinions about conversion will happen at the South County Advisory Council meeting ... Monday, November 25th, 6:30 pm, 148 South Wilson St., Nipomo.

Comments are limited to 3 minutes.  If you would like more information about this meeting or need a ride, please contact me at 870-656-4141 or jwycoff@me.com.

Living Room Meeting with John Wallace

Missy wonders why she
didn't get pie and ice cream.

Last night was a pie and ice cream gathering with John Wallace, the engineer who is working on developing a parcel map for the park as part of the conversion process and was also involved with developing the new, 118 lot section of the park.  For most of us, it was an eye-opening meeting.  

John gave us a project history statement (included at the bottom of this post) that detailed his extensive work with this park and understanding of the infrastructure issues here.  There were two major points that struck me during his discussion:

• There is a maintenance plan for all parts of the infrastructure … some visible to us, some not.  We can see the roads being seal-coated but probably do not notice when the sewer system is being maintained or pumped out.  (Although many of us noticed when the leach field was being re-worked due to rodent damage.)  There was an allusion recently at an HOA meeting about "sewer system stink." One of the meeting residents who lives close to the sewer system plant said that they've only noticed the smell a few times when the system was being pumped out.

• Many aspects of the development of the new part of park came at the request of residents through the HOA Board.  We asked John how hard it was to get owner approval for those things -- such as the new clubhouse and pool, walking trails, renovation of the existing clubhouse, playground area.  Allegations by the current HOA Board have been that they've had to fight the owner for everything.  John says he was told to do "whatever it takes to make it work and make it work well."  

         John's word for the Mesa Dunes owners was "compassionate." 

LOTS.  One thing I didn't fully understand was that, right now, we don't have "legal" lots, although many of us have markers showing the "boundaries" of our lots.  What we learned last night was that those markers were set to show the "rental lot space" and to guide placement of our coaches.  "In most cases," John stated, "those markers will be the same as the legal boundaries, but there will be cases where boundary issues will need to be worked out." 

Several people in the group brought up issues that showed the complexity of determining the legal boundaries between neighbors and settling the individual-versus-common-area issues.  I've just begun to appreciate why this process of conversion is so lengthy and methodical.  Not only does it have to adhere to state and county rules and regulations, it is creating 304 legal entities out of one 50-acre parcel, including a detailed inspection of all of the infrastructure: water, sewer, roads, common buildings, walls, pools, trails …. and so on.  

Mesa Dunes is like a small village … as a matter of fact it's far bigger than the barely-map-dot town I grew up in.

EMERGENCY ACCESS.  Most mornings, I walk Missy down the street and turn left onto a dirt trail that leads me into the neighborhood by the middle school.  This was a critical find for me because it offered us unlimited walking options.  However, I didn't realize it was actually an  "Emergency Pedestrian Easement" until we saw it on an aerial view map and "Vesting Tentative Tract" map that John provided us.  

Not only does this trail give us a way out of the park in case of an emergency, but it gives the kids in our park access to the middle school and walking diversity for others of us.  My neighbors are runners and can often be seen pushing a double stroller with their daughters (2 and a few months old) through the Rocking Horse neighborhood.

One of our detail-minded residents asked why there was only one one road leading into and out of the park … something that had never crossed my mind and another reason why all of us thinking together is such a plus.  The answer demonstrated once again how much thought has to go into a development such as this.  

If you look at a map of the park, you can see two major roads heading into the roundabout … Mesa Grande Drive and Taos/Durango.  The roundabout was designed to be wide enough to handle two streams of traffic exiting the park, thus offering a faster exit in case of emergency.  

PRICES.  Anyway you cut it, most of us wish we knew the price of our lots.  The more I understand this process, however, the more it makes sense that we won't know them for quite awhile.  

I continue to hear people call for having the appraisal done now.  But, how could an appraiser do an evaluation when the lots aren't even officially mapped?  Appraisers … like engineers … don't engage is guess work.  I met with a local appraiser and tried seventeen different ways to get him to give me an idea of what he thought the lots would sell for.  He told me in seventeen different ways all the reasons why that was impossible.  I tried.

Even the timing on this process makes it meaningless to try to put a price on the lots today. It could be two years before the lots are for sale.  A world of things could happen in those two years.

Project History (from John Wallace)

The project (Mesa Dunes) was built in two phases.  Phase 1 was developed earlier by the Hawkins Family and included a 186-unit mobile home park, clubhouse facility and on-site water and waste water treatment/disposal system.

In the late 1980s and early 1990s, Wallace Group assisted the new owners with the development of Phase 2 of the development.  The new phase consisted of 118 additional units processed through the County with the Planning Commission/Board of Supervisors approval of a Development Plan.  Phase 2 included the addition of 118 new residential mobile home lots and many Park infrastructure improvements including:

• an expanded community water storage and treatment system
• new waste water treatment and disposal system
• renovation and improvement of an existing play area
• a new clubhouse and pool
• existing clubhouse renovation
• perimeter fitness trail
• riparian/wetland enhancement and drainage improvements
• pedestrian emergency/school access
• an upgraded entrance with a roundabout for vehicles including school buses (although that didn't work out because of school bus regulations)
• improvements to Hwy 1 to improve entrance to the park (the road was lowered 2 1/2 feet!)

What Richard Laxton Did NOT Say

86 Degrees, 34,000 Monarchs
Paradise.

Wikipedia:  The Big Lie is a propaganda technique. 

It happened last night at the HOA meeting.  And, for a moment, I found my self doubting … wondering could this possibly be true?  After all, where there's smoke, there's fire … and, surely, someone wouldn't say something so outrageous if it weren't true.  Or would they?

Last night Cathy McAllister stood up and made the absolutely most outrageous … and, as it turned out,  categorically untrue … statement and said it came from Richard Laxton of Murphy Bank. I listened as she spoke with conviction and anger.  I watched as she shouted down Judy Hall's innocent question.  And, I took careful notes because, if what she was saying was at all true, I was going to have to rethink a whole lot of what I've believed and written on this blog.

Here's the story:  Cathy stated that she and Jeff had met with Richard Laxton of Murphy Bank and that he said that we couldn't use Sunrise Terrace to think about lot prices since their amenities are so much better than ours.  She also said he said that his experience with this particular law firm was that it priced lots $100,000 or more higher than they should be priced.

She then used my speculation that lot prices would wind up in the $175,000 - $225,000 range and concluded that the lot prices should be $75,000 - $125,000.  Suddenly she believes something I've said???

Since Richard Laxton was one of the first outside professionals I contacted on this journey and he impressed me with his deep knowledge of conversions, mobile homes and area values, I was shocked that he would make a statement so offensive to the professional reputation of a law firm.  I was also shocked because when I originally asked him what he thought the prices would be, he had responded without hesitation:  $150,000 - $200,000.

So last night I sent him an email which prompted another round of emails and then a rather lengthy phone conversation.  In brief, he denied that he made those statements, called them wild accusations and said I should ask the McAllisters to provide proof.

Here's the documentation of this conversation:

Email 11/12/13, 8:21 pm to Richard Laxton

Richard … I'm sorry to get you involved in this … however, at our HOA meeting tonight, Cathy McAllister said she and Jeff met with you.  Below are some of the things she said you said.  I am very concerned because I have based a good deal of my thinking on what I learned from you and from Michael.  I want to give the residents in the park the very best advice I can find and if I misunderstood you, then I need to go back and set things straight.

Sunrise Terrace -- Cathy said that you said we would be sorely mistaken if we used Sunrise Terrace as a guide to our lot prices because their amenities are so much better than ours.

Over-priced lots -- she also said that from your past experience with this law firm (Gilchrist & Rutter) you expect the lots to be over-priced by $100,000.  I have mentioned in conversation that my guess after looking at other parks and talking to various people is that the lots will be in the $175K - $225K range.  So she started saying, "Wouldn't it be better if our lot prices were $75K - $125K?"

Best Guess -- in our first conversation, when I asked you what range the lots would fall in, you said $150K - $200K.  Is there anything that would make you change that guess?  Is there anything that would make you think the $75K - $125K is a reasonable range.  (Oh how I wish it were!)

joyce

Email 11/13/13, 9:08 am to Joyce Wycoff

Joyce

Almost everyday I deal with loan customers who claim I said this & that. Sometimes I am shocked at what people repeat I said about a situation because they didn’t understand the conversation or heard what they want to hear. In the end I cannot make reccomendations to anyone as to whether one park is better than other because it is still an individual choice as to where to live. Since we service the loans we make we hear all the complaints when people need to sell a home and then can’t get out for one reason or another. In the end the appraisers are going to give their indication as to what the lots should be valued at. I think Michael has made that clear. Then after the park owner has made his decision to price the lots, the marketplace will take over and determine what the real values are. Murphy Bank does not set property values.

Sincerely,

Richard Laxton

Email 11/13/13, 9:57 am to Richard Laxton

Richard ... thanks for your prompt response.

Because Cathy's claim is so significant ... that you stated that this lawyer has overstated lot prices in the past by at least $100,000, could you confirm or deny that specific statement.  The implication in what she said was that it was a deliberate overpricing in an attempt to do something devious and that it was plotted by this particular lawyer.

Because this is affecting your reputation, would you be willing to write an open letter to the residents that could be faxed to the Mesa Dunes office and distributed by them?

joyce

Email 11/13/13, 10:04 am to Joyce Wycoff

Joyce

In the first place, attorneys do not set appraisal values! This is exactly why you cannot get involved in hearsay. There is a park on the coast that has been involved in litigation for 5 years on lot prices but those prices were not set by attorneys.

Richard Laxton

Shortly thereafter, Richard called me.  Highlights of that call:

He did not meet with the McAllisters although after a while he did remember a phone call where "some guy was talking about a $250,000 lot."  Richard stated, "Lot prices will not be $250,000.  That is just not going to happen."

He admonished me not to get caught up in this type of hearsay and to insist that they prove such a "wild accusation."  He reiterated that it would be crazy for a park owner to set prices that were too high for the market since they would never sell.  He also reminded me that no one is obligated to buy their lots so why would they if the lots were over-priced.

He agreed that while every park is different, Sunrise Terrace does give us a marker for thinking about lot prices.  He also talked about Pismo Beach Mobile Home Park where the lot prices are $250,000 but they are too high and lenders are not making loans at that price.

Conclusion:  Make of this what you will, but if someone is willing to stretch the truth this far, can they be trusted at all?

The Good, The Bad ... and The Ugly

Last night's HOA meeting was another spaghetti-tangle of misinformation with one bright spot … well, maybe two.  The brightest spot of the meeting for me was when Judy Hall stood up and asked why we all can't work together.  

This was the HOA's meeting so I was determined to just sit and listen but I want to applaud Judy for her brave effort … especially since she wound up being shouted down by Cathy McAllister. 

Interestingly, this is what I tried to suggest a couple of months ago, even making an overture to get together through a now-resigned board member.  That overture was rejected also.

The Good … there weren't a lot of people there to hear the misinformation.  

Jeff announced that he has formed a new committee to develop a "proposal for a fair conversion."  I'm happy to see this broad-based approach to figuring out how to make this conversion better for everyone.  However, I got a little worried when Jeff said he was going to create a proposal for conversion, "like nothing you've ever seen before."  

When Jeff described the people who would be on this committee, they sounded like smart, capable people who could help bring all of this stuff together.  I recognized some of the people behind the descriptions and one of them happened to be sitting beside me.  When the meeting ended, I asked him if he was going to be on the committee and he said, "Not that I know of."  Since he and his wife still live out of the area, he wasn't sure he would have time to serve on the committee. Curious.

If I had a crystal ball, what I would like to see is a proposal that would add flexibility, protections and incentives to the already existing conversion offer.  Unfortunately, what I would probably see is a proposal that doesn't make sense, one the owner has to reject.  At that point, Jeff will be able to say, "See, we made a fair offer and they didn't take it."

Apparently, this proposal development process will invite all of us to participate in a small group meetings.  We need to be there and try to help shape a proposal that has some possibility of being accepted.  I have some things in mind that I think could help more people benefit from this conversion.  I would love to share these ideas.

The Bad … The HOA Board continues to say they are not opposed to conversion and then acts as if they are.  One of the first things they did was to announce that their lawyer had filed a 38-page "brief" calling for a new survey and a "fair conversion."  That "brief" (actually a long, convoluted, redundant letter) asks the County to deem the application for conversion incomplete primarily because not enough residents support it.

Jeff continued to state that conversion would devalue our homes and we would be priced out on rent, even giving us another specific number saying we would only get $15,000 for our homes. Where does he get these numbers?

I don't know if the complexity of the issues around space rent confuses him or he is deliberately not painting the whole picture, however he allowed one resident to draw the conclusion that "70 percent" of the park would see their space rents go up to market rate.

     Just to reiterate the written facts:  almost everyone in the park is on a lease (only 36 are in rent-controlled properties).  Everyone on a lease can stay on their lease indefinitely … that means their rent will stay the same, with annual increases as prescribed in their own lease agreement.  Period

The Ugly … Language and argument by innuendo, Out-shouting, and Blatant lies.

Just because politicians do it, doesn't mean we should.  This is our community.  We live together and will long after this conversion has become a thing of the past. 

"Indisputable" Facts.  Here is an indisputable fact … we don't have all that many facts and the ones we do have are in writing.  Just because Jeff says we're only going to get $15K for our units, doesn't mean that's so.  Just because Cathy says the lot prices will be overpriced by $100,000, doesn't mean that will happen.  They are speculating and calling their speculations not only "facts" but "indisputable facts."

I have speculated about the price of lots and other aspects of conversion.  However, I have never called them facts and would never dare to call something an "indisputable" fact unless it were in writing and/or validated by two or more outside sources.

The Appraisers.  Jeff continues to damn by innuendo.  Once again last night, he insinuated that appraisers can't be trusted … especially the ones paid by the owner.  He doesn't know … or doesn't care … that the recent real estate debacle created new legislation to make the appraisal process tighter and less subject to influence.  In a recent living room meeting with Michael Fitzgibbons from Murphy Bank, he told us that they can no long order appraisals directly from an appraiser.  They have to go through a third-party management firm to order appraisals.

The Owner.  This poor guy, whoever he is, never gets a break.  Not only is he only "in it for the money" (of course the rest of us are never interested in the money when we sell our homes, cars or whatever), he really has a devious plan for over-pricing lots now so they won't be sold until sometime in the future.  That's a strategy you can take to the bank. (And I did … I asked Richard Laxton of Murphy Bank what he thought and he said, "Great idea.  I'm going to list my house today for $850,000.  Of course it's only worth $350,000, but what a great idea.")

The Lawyers. The Board doesn't miss many chances to slam the lawyers and bring up past conversions as their "proof."  I don't know the lawyers but I do know Susy Forbath their representative in this conversion.  She has been open and responsive in all of her dealings with me, and, as far as I know, with everyone else she has dealt with.  

When I've asked her about past conversions, she has explained the context in enough detail that I've begun to understand how a conversion can go "bad."  Conversion is a long process and the world changes.  Conversions launched on the eve of the recent real estate crash didn't fare well.  Great swaths of Las Vegas were left empty as people lost their jobs and walked away from their homes.  That had nothing to do with any sort of conversion; it was the forces of the market, the same forces that affected mobile home parks whose conversion timing sucked.

However, the Board doesn't want to deal in the nuances of reality when they can continue their war of innuendo and misinformation.

The Engineer.  I was truly disheartened by the innuendo around John Wallace.  Because he will be paid by the owner for his *professional* services, it was implied that he is incompetent or even unethical as wafts of past issues drifted around the room.  I met John this week and sat in a meeting where another land use applicant unrelated to Mesa Dunes repeatedly praised John and his work.  While I don't know him well, John seems like a bright, committed, rational man.  If the Board wants to attack him or his credibility, I think they should do it out in public and not by the snide, whispering innuendo that went on last night.

Because John has been involved with major systems in the park (the sewage system specifically) Jeff ended this innuendo thread by saying, in a wink-wink fashion, "And, we know what the health of the park is."  The body language and implication indicated that the park is falling apart and only Jeff can save us from that fate.

The Rules.  Repeatedly, Jeff said the owner and his lawyers have not followed the rules but he looks at "the rules" through his own perceptions.  He wants to know the price of the lots now even though "the rules" say the lot prices will not be released until the County has approved the final map, the inspections and appraisals are done, and the budgets for the future HOA is prepared.

Members of the HOA Board have repeatedly used the analogy of buying a house … or a car … or whatever, saying "you wouldn't buy a whatever if you didn't know the price of it."  What they don't say is that the house or the car … or our lots … are not for sale and won't be for probably another two years.  

The conversion process is simple the process of mapping and valuation that will make those lots available for sale within the constraints of state and county regulations.  We're being assured that the lot prices will be set in an orderly, rational manner led by a park appraisal and then confirmed … or not … by bank appraisals when lots actually do go up for sale.

We all want to know the price of the lots.  However, from the first meeting, Susy Forbath told us we wouldn't know them for a year or two.  Just because we don't like the rules, doesn't mean we get to make up our own.

The Price.  After accusing me of everything they could think of, Cathy is now citing my numbers as the "official numbers." Last night she used them as the starting point for saying they are $100,000 too high, artificially inflated by the owners.  

First, let me remind you that my numbers are based on my research over the past few months, developed as a way to help people to think about their own situations.  

Second, I don't have a crystal ball.  I don't have any insight into the mind of the owner.  I don't have any concept of what the appraiser might come up with.  However, I can look around and compare us with other parks.  I can look at recent sales in other parks and get a feel for what lot and coach packages are selling for.

That looking around process makes me think the range (today's range … who knows what will happen in two years) would be $175,000 - $225,000.  In a mind-numbing swing from my guess to her fantasy, Cathy lopped off $100,000 to make her numbers $75,000 - $125,000.  

Go Cathy!  I hope you're right, however, your logic and track record aren't very good so I'm not going to count on it.

The first guess on lot prices I got from anyone was from Richard Laxton of Murphy Bank (someone Cathy talked a lot about last night … but more about that later).  His guess was $150,000 - $200,000.  Using Cathy's logic, the owners must be sitting around thinking, "We have to make the lot prices at least $250,000 - $300,000 so the banks won't loan the money to the residents."  I can see them rubbing their hands over the bubbling cauldron right now.

Out-shouting.  At one point, when a resident questioned something, Cathy McAllister started screaming, "Would you want to pay $225,000 for 18 inches of dirt?  Would you? … WOULD YOU?"  The resident gave up in the face of that wall of hostility.  So much for a calm, rational exchange of information.

Blatant Lies.  The biggest, baddest, scariest of the lies came from Cathy talking about something she said Richard Laxton of Murphy Bank said.  Anyone who knows bankers would know that he would never say what she said he did.  After a series of emails and a long conversation with Richard this morning, he categorically denies making the statement and told me to "have them prove it."

This is so important, it will be covered in a subsequent post titled:  What Richard Laxton Did NOT Say.

Questions for HOA Meeting

Yosemite Coyote

The HOA will be presenting an update on conversion at their meeting Tuesday, November 12, 6:30 pm, Upper Clubhouse.

Here are three questions I hope they address:

Question #1.  In the November, 2013, HOA Newsletter, they state:  "If this subdivision goes through everyone will likely lose an average of $100,000 or more of the investment in their home."

If the average of all home sales in the park during 2012 and 2013 is somewhere in the neighborhood of $80,000, could you tell us how everyone will lose $100,000 or more of the investment in their homes?  While a few residents may have done extensive remodeling, I doubt that everyone has.

Question #2. In the November, 2013, HOA Newsletter, they state: "Our attorney has already filed our preliminary opposition to this conversion because we need to know "the price" before we can vote on whether we are in favor of the conversion.

Could you tell us where your attorney filed your preliminary opposition?  No one I've talked with seems to know of a way to "file" opposition at this point.  If your attorney filed opposition, why isn't this filing publicly available and why hasn't it been presented to the owner or the owner's attorney?

Question #3.  What are your plans to protect the park if your actions wind up throwing the park into litigation?

Litigation is a normal next step that can last for years after a conversion process has been denied.  This creates a limbo state which most potential park residents avoid, putting downward pressure on home values and lengthening the time it takes to find a new buyer.

How can you assure us that YOUR actions will not make us lose value in our homes?

Conversion, the Economy and Corrections

Sunrise - Monterey Bay

Corrections … on both sides.

In responding to the erroneous claim that there is a fear-of-conversion "selling spree" happening in the park, I replied that there is almost nothing for sale in the park and implied that it was due to new owner interest in the possibility of owning the lot as well as the coach. While that might be a factor, the bigger factor is probably the economy.

When I started looking at parks about two years ago, both of the over-55 parks on Highway 1 in Pismo had multiple sheets of units for sale.  Today Pismo Beach MHP only has 5 listings and Pismo Dunes (the larger, park-model oriented park) has 47 with 4 pending … still far fewer than two years ago.

I talked to a woman in the office at Pismo Beach MHP and asked why there were so few homes for sale and she said, "the economy."  Pismo Beach is a share-owned park with shares selling for $250,000.  It's hard to compare parks … located right across from the beach and within walking distance of Pismo down town, this park gets points for location.  It loses points for over-crowding and a lack of greenery.  And, close as it is to the beach, it has no views.

Continuing home from the beach, I stopped in the parks further away from the beach on Highway 1 and there was almost nothing for sale there either.  The good news is that, if you're interested in selling, it's probably a pretty good time.  The bad news is that this could put upward pressure on the lot prices.  ;-(

Relax Jeff.  Jeff McAllister worried during his Channel 12 interview whether or not his home would sell for $400,000 (assuming a $250,000 lot price and a $150,000 home value).  It's still apples and oranges but there is a unit for sale in Pismo Beach MHP for $395,000 (including the $250,000 share price).  It's bigger (1,950 square feet) but no garage. Apparently extensively upgraded inside and outside with exterior masonry. Closer to the beach but no view.

OPINION: Position on THIS Conversion

Abalone shell ... one of the hardest materials known
to man ... is made, basically, with saltwater and spit.

Yesterday, after months of researching conversion, listening to residents, area real estate professionals, lenders, and people from other parks, I stated that I was for it.  I need to clarify that statement.  

I am for *this* conversion.   Conversion in general is a highly-regulated process with a lot of protections for residents, whether they want to buy or continue renting.  However, in the past, a few park owners have used the conversion process to break rent control or evict lower-income residents. Those unfortunate situations led to lots of new regulations and protections.

However, I can still imagine situations where conversion would not be a good thing … in predominantly lower-income parks for instance.  And, I can imagine park owners who might not be interested in creating a fair and equitable process.

Those circumstances do not exist in this park.  We have a wide diversity of ages and income levels. There are a lot of people who will benefit by real estate ownership … and the owner has gone above and beyond the minimum requirements to offer protections for the people who do not want to buy their lots. One example is his offer to cap space rents for residents over 80.

The HOA Board is now officially against *this* conversion.

11/16/2013 UPDATE

Meeting Moved:  When the County Supervisor found out that there was a plan to picket the park when she visited, she had the meeting moved to another location.

Meeting Cancelled:  When the County Supervisor for Arroyo Grande offered to serve as an unbiased moderator  for a discussion about both sides of conversion, representatives from the HOA Board declined to attend.  Her assistant said the Supervisor was very disappointed.

Why would the Board decline the opportunity 

to state their views in person with the new Supervisor?

****

The HOA Board, which for months has been claiming they are not against conversion, have now filed their opposition to *this* conversion, appeared on local news to fight it, and are, reportedly, now planning to picket a meeting scheduled here in the park today with a County Supervisor.  In many of their statements they've said they are not against conversion … they are against *this* conversion.

• Apparently, they think a resident-initiated conversion would be a better thing because they could get a cheaper price for the lots and would be able to take control of the park.

• Apparently, after months of spreading misinformation, calling people "liars," "plants," and "greedy," and now officially obstructing the conversion process, they think the park owner would be willing to deal with them.

While I don't think that mystical conversion will ever come about, I also want to make it clear:

I would NEVER support *that* conversion.  

While, ideally, a resident-initiated conversion might be a good thing, it would have to be led by people who have qualities of leadership sadly lacking in the conversion opposition group in this park. To support *that* kind of conversion, we would need to be able to trust those leaders.   

How would we ever trust people who have been so willing to spread misinformation and use fear tactics as their primary strategy? 

How could we trust people who were supposed to be representing the entire park but have chosen to ignore the elderly, the lower-income, the residents who actively want to purchase their lots, and the majority of the park who just want the information they need to make a decision for themselves?

How could we trust people who actively discouraged area professionals from coming to a public park meeting to share their information about values in the local area?

I don't know the positions of all members of the HOA Board, but as an organization, they seem to belong to the "not *this* conversion" group of opposition.  How can we trust them when they are willing to print blatant lies in their newsletter ... for instance, this scare tactic from November, 2013:

"If this subdivision goes through, everyone will likely lose an average of $100,000 or more of their investment in their home." (emphasis ... and comma ... added)

Few of us even paid $100,000 for our homes.  Unless we did massive remodeling, how could we possibly lose more than that?  We need facts and the truth.  Until the Board starts to deal in those, I could never trust them with my future.

HOA Actions Make Me Wonder

Broken Heart on Moonstone Beach, Cambria

HOA Files Opposition.  In their November bulletin, the HOA states that they have filed preliminary opposition to *this* conversion because, they state, "we need to know 'the price' before we can vote on whether we are in favor of conversion." (The HOA seems very careful to always talk about *this* conversion as if they have another one they could pull, like a rabbit out of a magician's hat, shouting, "This is the one we want!")

After months of denying that they are against conversion, they have now made their opposition official. While they blame the lack of lot prices as their reason, they ignore the fact that the timing of the sub-division appraisal and the pricing of the individual lots is a standard part of this highly-regulated process.  The owners and lawyers are following the law but the HOA chooses to ignore that fact.

We were told on the first night that Susy Forbath came to talk with us that we would not know the price of the lots for a year or more.  The price of the lots is related to our decision about whether or not we want to buy our lots.  At the present moment, that is NOT the question.  The question is whether or not we believe the change to a resident-owned park has benefits for some and does not harm others. 

The HOA chooses to ignore a LOT of us. 

In June, 99 people ... over half of the responders and one-third of the total park ... responded with a "yes" vote about conversion.  Yet, the HOA seems determined to ignore that survey and, in the process, ignore many of us, including:

Those who want the benefits of home ownership. The HOA seems determined to ignore the segment of residents who see conversion as a way to protect their financial futures and participate fully in the benefits of owning California real estate.

Seniors over 80. The HOA seems determined to ignore the elderly in the park whose space rent will be capped by conversion. (See Basics of the Offer.)

Lower Income Residents. The HOA seems determined to ignore the lower-income residents in the park who will be eligible to switch to state rent control after conversion and thus slow their ever-increasing space rents.

Residents on Leases.  The HOA seems determined to ignore those of us on leases (most of the park) who might just want to continue leasing and have been assured that we can renew our leases for as long as we want.

Information and the Facts. The HOA seems determined to ignore the words and information provided by area professionals who have come to the park to explain to us how this process works and how values will be established based on the local market and professional appraisals rather than simply being set by the owner.

It makes me wonder just who it is that the HOA is representing.

It also makes me wonder just how long the rest of us are going to let the HOA act as if they are representing us as they try to shut *this* conversion down.  I've looked at what might happen if they succeed.  It isn't pretty … however, that's the subject of a future post.

If you want the options offered by conversion, it's time to speak up.

If you're tired of the misinformation being spread through the park … and even on television … it's time to speak up. (To remind yourself of the misinformation, check out MYTH Busting.)

Ask questions.  Talk to your neighbors. Do your own research … or read this blog. Attend an informational meeting … or host a living room meeting where you can ask all the questions you want in a calm and safe environment.  Find out the facts and be prepared to speak at the public meetings.

The HOA Board is trying to take away the options offered by *this* conversion.  If they succeed, it will be because the rest of us did not speak up.  Let's talk.  jwycoff@me.com.

My official position on conversion:  I am a senior resident in the park as well as a long-time blogger and something of an information junkie with a background in business and financial management.  After four-months of intense research, reading regulations, pouring over information released by the park owner's lawyers, talking to area professionals including real estate people, lenders, appraisers, people from other parks and the area representative of Golden State Manufactured-Homes Owners' League, as well as listening to a whole lot of residents, I have made up my mind about conversion.

I AM FOR *this* conversion. I believe it offers opportunities to those who want the benefits of California coastal home ownership and protections to those who don't want or need those benefits. I don't know if I will want … or even be able … to buy my lot.  I do know I want the option to make my own decision.

Full Disclosure:  I have no financial connections with the park owner or his representatives.  I'm not being paid or getting a special deal on my lot.  And, for those who are spreading the rumors that I'm getting my lot free … that would probably make me the highest paid blogger in the world!