Residents of a mobile home senior community in Ohio are frustrated with rising costs from its new owner financed by Freddie Mac — a government sponsored enterprise. 'They’re not buying food or eating properly ... they’re so worried about the rent.”
WASHINGTON — It wasn’t long after residents of a mobile home senior community in Ohio were told that their property had been bought by a new owner, with the help of financing from federally-backed Freddie Mac, that their costs started going up.
But rather than preserving one of the last bastions of affordable housing, the role that Freddie Mac and its peer Fannie Mae have played in the market has done the opposite in some instances, affordable housing advocates and lawmakers say. They say the access to relatively cheap, low-risk capital provided by the federally-backed entities has contributed to a surge in mobile home park acquisitions where new owners are raising rents and fees.
At the Navarre Villages, Bebout was told it would cost $25,000 to move her 1,300 square foot manufactured home and then she’d have to buy a new piece of land to put it on or find an opening at another park. “The harsh economic realities of the past year have been particularly challenging," said Fells."The interest on our loan has more than doubled as a result of the dramatic rise in interest rates. We are also facing a regional above 8%, cost increases for labor, insurance, taxes, utilities, supplies, and vendors who pass through their own cost increases."
Sen. Sherrod Brown, an Ohio Democrat, sent a letter to the CEO of Freddie Mac in December about the rising costs at Navarre Village, asking for more details on how the firm goes about approving loans for acquisitions and what considerations it has for protecting tenants from rent increases. “Fannie Mae has been a leading source of liquidity for Manufactured Housing Communities since the early 2000s, and we remain committed to preserving and advancing this vital sector of the housing market,” a Fannie Mae official said in a statement noting that it had no authority over rent decisions by the owner.
“It feels ironic in a very unfortunate way that Fannie and Freddie are actually, by purchasing these loans, they’re making this problem worse not better,” said Jim Gray, a nonresident senior fellow at the Lincoln Institute of Land Policy. “What Fannie and Freddie really should be doing is making it easier to help people buy their own community and yet what they’re doing is they’re helping these predatory investors buy communities.
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