Trailer park housing fuels REITs
Retirees and others looking for affordable housing are giving the trailer park lifestyle a fresh look these days.
Investors have picked up on this trend, driving shares in Sun Communities and Equity LifeStyle Properties sharply higher this year. They are two of the biggest owners and operators of manufactured home communities. The real estate investment trusts, or REITs, also own lots that host recreational vehicles.
As home prices and rents have risen sharply, retirees and others seeking more affordable housing have helped drive up demand for manufactured homes, says Ryan Burke, an analyst at Green Street Advisors.
The property type represents about 7 percent of the nation’s housing stock. Even so, manufactured homes REITs have a total return of 18 percent so far this year, behind only infrastructure and data center REITs.
“The demand outlook continues to look good and, perhaps most importantly, it isn’t being met by commensurate levels of new development or new supply,” Burke says. “And that’s something we don’t see in any other real estate type.”