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SB 510 gives approving authorities the right to reject a conversion of a mobile-home park when it is not supported by a majority of the homeowners. What could be wrong with that?
For one thing, it could significantly reduce our choices as homeowners. It could wind up taking away the option of full homeownership (coach and land) that could be beneficial to many of us. Because the language uses the "majority of residents" as its key point, it ignores the fact that elections seldom … if ever … have *all* residents voting.
When the requirement is for a "majority of all," every person who does NOT vote, effectively casts a NO vote.
SB 510 will make it much harder for people who want the benefits of full home ownership to exercise that option … while doing nothing to improve the conditions for people who want to continue renting … at least in a park such as Mesa Dunes where almost all the residents are already paying high space rents.
What's the alternative to conversion?
What I'm not sure people think about is what happens when a conversion is denied.
Does the owner just say, "Oh, well, that was a nice try that didn't work?" Hardly.
Usually, he appeals and the conversion winds up in court … a process that can drag on for years, keeping the park in limbo and discouraging sales and ultimately depressing the value of our homes.
Usually, he appeals and the conversion winds up in court … a process that can drag on for years, keeping the park in limbo and discouraging sales and ultimately depressing the value of our homes.
Other options include selling the park to a different park owner … one who might or might not keep the park at the same level of maintenance as what we have today. Or to a real estate investment trust … an entity designed to maximize profits for the trust which consists of stockholders who never see or even know about the park. They don't care what the maintenance level is … just their return on investment.
Rumors … Rumors … Rumors
The rumor mill has it that the current HOA Board … or at least a subset of it … has visions of stopping THIS conversion and starting their own membership conversion like Sunrise Terrace where share ownership is $200,000. The rumor mill also has it that the board wanted to buy Mesa Dunes several years ago but were afraid of the infrastructure issues so they didn't buy it.
The current owner bought it, took the risks the Board wouldn't, and now wants to sell it.
So, let me see if I've got this right … the HOA Board, who have vigorously maintained that they are not against conversion are actually against THIS conversion and want to start their own.
So, they are gathering letters and signatures so that they can oppose the conversion when it goes to the county … and presumably they will show up in force to oppose THIS conversion.
If they succeed in getting THIS conversion denied, the owner will be forced to pour even more money and energy into the pockets of lawyers. And, after years of litigation, let's presume that the owner loses (something that rarely happens).
Then, the HOA Board, is going to go to the owner and say politely, "We'd like to do a conversion OUR way." (This is sort of like going to a Mexican restaurant and saying I want prime rib, please.)
And, after opposing him for years and costing him a bundle of legal fees, they think he's going to say, "Oh, goody … I wish we'd thought about that ten years ago … let's make a deal … and, oh by the way, I'd be happy to give you a really good price."
And, after opposing him for years and costing him a bundle of legal fees, they think he's going to say, "Oh, goody … I wish we'd thought about that ten years ago … let's make a deal … and, oh by the way, I'd be happy to give you a really good price."
I don't think so. To me, this is just fantasy thinking.
I wrote a letter to Governor Brown … obviously one that did not sway his thinking, but it does spell out my thoughts about SB 510. I use my own specifics just to help illustrate the issue and have included it below even though SB 510 is already signed.
If we want the choices that this bill could take away from us, we're going to have to make ourselves smarter and be willing to make our needs and concerns known to the county. We need to understand ALL of the facts about our choices.
Simple Road Map to Help You Make Your Choice
I am putting together a road map of simple questions each of us can ask ourselves to help us think through our individual situations in order to make a better, more informed choice. We will present this road map at the meeting October 14th, 5:30 pm in the LOWER clubhouse.
To help us think about conversion in a rational, deliberate manner, we will also have two outside experts … Thomas DeRosa and Rick Milanesa from Hybrid Homes. They have a lot of experience with mobile homes, conversions and values in the surrounding area.
Please put this meeting on your calendar ... we have the power to make this conversion beneficial for all of us ... but only if we act together in a way that protects our options.
Letter to the Governor:
Dear Governor Brown:
SB 510 sounds like it would be good for "the people." Actually, it would make it much harder for mobile home park residents to gain the financial protection and appreciation offered by affordable home ownership. Here's why I believe this bill will harm me and many other fixed- and modest-income people such as myself:
1. Most mobile home owners own their units but not the land beneath their units. They pay "space rent" for their lots, rent that increases every year. I am on Social Security and pay $950 per month in space rent. In 20 years, I will be paying $1,716.
2. When a resident buys the lot under the unit and gets a 433a certificate, it qualifies for standard mortgage rates, giving residents the full range of benefits of home ownership … controlled monthly expense, real estate appreciation, tax benefits and more control over their community. Instead of space rent of $1,716 in twenty years, I could have the option of a fixed mortgage that, even with HOA and property taxes, would wind up in the $1200 - $1600 per month range. I would have greater control over my finances and my future.
3. If a park owner wants to convert a rental park into a resident-owned park, the first step is to do a survey of support. In my park, Mesa Dunes Mobile Home Estates, there are 304 units and 168 residents returned the survey (99 Yes votes, 35 No votes and 34 declined to respond) … 58% positive support but only 55% of the total residents … after a LOT of encouragement to complete the survey.
4. SB 510 gives local agency the right to disapprove a subdivision plan if the survey does not demonstrate the support of a majority of residents. Our park has many elderly residents, vacation-home owners, and people who are fearful and anxious of change … any change. Getting EVERYONE to vote in any election is almost impossible, SB 510 would be a huge hurdle to a successful subdivision that offers home ownership benefits to many residents and rent protection for all who decide not to buy their lots.
While I believe the sponsors of this bill had good intentions when they wrote this bill, with the way it is written I'm not sure they realize how much they were restricting access to the benefits of home ownership to modest income people across the state.
Please veto SB 510. I think it can be re-written to provide the protections the sponsors wanted to create without causing the hardships for those of us who want to be full homeowners that will be created by this bill.
