We’ve discussed the often-precarious relationship which exists between mobile home park owners and mobile homeowners. As we mentioned, the relationship was so contentious up to the 1970s that the State of California enacted the Mobile home Residency Law (MRL) – Section 798 of the State Civil Code – to help to regulate the relationship and help the homeowners against disreputable acts committed by mobile home park owners.
Since this enactment of the MRL the professional lobbying arm of the mobile home park owners’ association has put forward the notion which states the MRL and local rent control ordinances interfere with the “free market” and landowners should be able to do what they want with their land.
While there is merit to the argument the park owners should be able to do what they want with their land, there is and never has been a “free market” when it comes to rental parks in the State of California.
To review: there are two types of mobile home parks – rental parks and resident-owned parks. In rental parks, the resident owns their home and pays rent to the park owner for the space which their home occupies. In a resident-owned park, the resident owns their home and the land on which their home sits. The vast majority of mobile home spaces in the State of California are in rental parks.
This awkward conflict of homeowner versus landowner plays out in a number of different ways, but none more contentious than at the time of a sale of a home. Where it may seem to be a simple transaction, there is much more than meets the eye.
To demonstrate my point, let’s call upon Grandmother Jones. As previous stated, Grandmother Jones lives in her home which she and her husband purchased years ago. Things have become difficult for Grandmother Jones and she has decided to move into a nursing facility. As we discovered when we spoke of her previously, the type of home she lives in plays a considerable role in the type of transaction which follows.
For Grandmother Jones who lives in a single-family residence, the transaction involves hiring a real estate agent, working out pricing, and finding a buyer for the home. Contracts are signed and monies are exchanged, and the entire sale process is finished; Grandmother Jones is now living comfortably in a nursing facility.
For Grandmother Jones who lives in a rental park, the transaction involves hiring a real estate agent, working out a price, and beginning the search for a perspective buyer. This is almost the same as the first example, except to get to this point, Grandmother Jones has, by law, been required to notify park management of her intent to sell her home. This often focuses the attention of management on to a seller.
The added attention can come in a number of different forms. Park owners and/or the park management have been known to produce lists of home improvements they require for the home to be sold – this is illegal, by the way. Some residents will be prohibited from selling their homes in-place because State law forbids home of a certain age to be sold; in some cases park owners and/or the management have expanded the definitions of a certain age and required homes to be replaced or deemed unable to be sold. Some park owners and/or the management will require space improvements (different from home improvements) such as tree removal or driveway removal and replacement, the costs of which are passed along to either the seller or the buyer or both in some cases. This, too, is highly illegal.
Once the added scrutiny on the seller has set in, the question then arises of the incoming space rent. If the park owner and/or the management is being generous, a small, or at least reasonable, increase is put into place. As we discussed in a previous part of this series, park owners often use the increase in space rent to stymie and prohibit the sale of a home.
With all the things we’ve just mentioned in place, the final act which a seller must contend with is the approval of the incoming buyer. In the single-family scenario, the seller is the sole determiner of a qualified buyer. In the case of a rental park, the buyer and seller are both at the mercy of the park owner and/or the management.
The MRL does make “interference” in a home’s sale illegal, but the ambiguity of the language makes proving interference – unless completely blatant – almost impossible. The park owner needs only to disqualify the buyer for whatever reason to stop the sale of the home. Some require the signing of a long-term lease with oppressive terms in the contract. Others require a ridiculous amount of money on deposit to qualify.
It should be said here that the qualifications the buyer must meet for the park owner are not for the purchase of the home. Instead, the park owner can have a separate and distinct set of requirements a buyer must meet to be qualified to lease the space. All of these requirements are extremely detrimental to the smooth purchase of a mobile home in a rental park.
The claims and cries of “free market” interference by local rent control ordinances would ring true were the set of circumstances equal to a “free market” transaction. In a free market, there are no intervening third parties which have an equal – if not heavy-handed – say in the outcome of the transaction. Rent control ordinances help to keep the playing field level for all parties involved in the home’s sale.
It is a wonder why more local jurisdictions which have a number of mobile home parks within in them – all of the North County cities, for example – don’t take greater care to protect this great source of affordable housing. It is easy for an elected official to be lazy and not do any research to understand the dynamics of this homeowner/park owner relationship. But it should be mandatory for any elected official to learn all the ins and outs of this type of home ownership and work to protect it for future generations.