Who benefits from the subprime crisis?

Implications: The Manufactured Housing industry will benefit from the site-built housing industries troubles as the subprime consumer market and financing shifts to manufactured housing.

Analysis:     After declining 75% in the past 8 years, the manufactured housing industry is at it's lowest point in 42 years with home shipments at a 90,000/year rate.  While the initial drop (1999-2003) in the industry was due to the consumer financing excesses of the mid 90s that resulted in over 200,000 repossessions and the exit of most consumer financing entites, the continued reductions in the years since 2003 has been the heightened competition from consumer financing for site-built homes in the sub-prime markets.   

     Now, with the rapid disappearance of consumer subprime financing for site-built homes, these subprime consumers are shifting to manufactured homes.  Further, it appears that the investment community is shifting their subprime funds to manufactured housing consumer financing entities.  The consumer finacing models for MH can create performing loans from subrime consumers, where the mortgage industry could not.  

      While this shift has already begun in the last 90 days, it will be muted by prise competion as the foreclosures of site-built homes flood the market in the next 24 months.  However, it does appear that MH will now benefit from the same poor lending practices that brought on their demise 8 years ago!