JACKSONVILLE, Fla., March 21, 2017 (GLOBE NEWSWIRE) -- IHT Realty announces Park Place Communities (PPC) is taking a major step toward growing the stock of affordable homes in the United States.
PPC, a national real estate investment company that specializes in affordable housing, is seeking $1 million in capital to facilitate a large-scale affordable home project.
The company plans to take existing mobile homes, renovate them and sell them to qualified buyers using five-year amortized mortgages. The buyer will make monthly payments for five years at 12 percent.
"This allows buyers to purchase the mobile home for about the same monthly cost of renting," said CEO Andrew Lanoie of Park Place Communities.
IHT Realty Crowdfunding, a real estate company that helps sponsors raise capital for their acquisitions, will be assisting PPC in securing funds as it looks to expand its operations and acquire an additional 15,000 to 20,000 mobile homes over the next few years.
"There is a huge demand for affordable housing right now and there are not enough parks to fill that void," Lanoie said. Right now, there are roughly 50,000 affordable housing parks in the United States.
And with housing costs projected to rise by 5.4 percent from July 2016 to July 2017 — according to a study by CoreLogic Home Price Index — mobile homes are becoming a practical alternative.
"As the wage gap in the United States widens, there has been a shift towards lower paying jobs, which leads to an increase in demand for affordable housing," Lanoie said.
According to the most recent report by the Social Security Administration, 36 percent of U.S. wage earners make less than $20,000 per year and 50 percent earn less than $30,000 per year.
"With 10,000 Baby Boomers retiring every day, 47 percent of which don't have any retirement savings, affordable houses are their last opportunity of home ownership," said CEO Dan Summers of IHT Realty Crowdfunding.
PPC, a national Top 100 owner-operator of mobile home parks, currently owns 13 affordable housing parks in eight states with nearly 1,000 total homepads.
The company is looking for a $1 million mortgage pool to issue fixed-rate mortgages to buyers. It is offering a debt investment opportunity secured by a first lien, which is also backed by a corporate guarantee with a 10 percent interest rate paid to investors.
The first step will be to renovate more than 125 units, Lanoie said.
Contrary to popular belief, mobile homes are not really mobile. It costs over $3,000 for a resident to move their home out of a park, Lanoie said, which is the reason 98 percent of mobile homes will remain in the same location.
"Mobile home parks are one of the most stable and predictable investments during a recession and recovery," Lanoie said.
IHT Realty Crowdfunding LLC is Florida's premier real estate crowdfunding business that offers investors the opportunity to capitalize on residential and multifamily properties across Northeast Florida.