UMH Properties Inc. (NYSE:UMH) Q3 2019 Earnings Conference Call - Final Transcript
Nov 08, 2019 • 10:00 am ET
[Operator Instructions] The first question today comes from Rob Stevenson with Janney. please go ahead.
Good morning, guys. Sam so you sold 71 homes in the third quarter this year versus 80 in the year ago quarter. How are sales going versus your expectations? And how is the availability of financing today for residents?
Samuel A. Landy
Sales are according to expectations. Basically because our sales increased so much the first and second quarters we ran the inventory down. So it was a little bit hard to catch up which is why sales didn't grow this past quarter. But sales are on target. We hear about more and more large price home sales and we think they'll continue to meet our expectations. We sold so many homes that we wound up with a little bit of a lag in the time it took to set up the replacement homes.
Okay. And how is financing for in the space these days? I mean is it -- how -- given the average sort of FICO cost and the lack of land I mean how easy is it today versus a year ago or three years ago for someone to get financing for one of these homes not only just in your communities but just in general?
Samuel A. Landy
Yes. No. It's improving. I mean compared to three years ago it's improved dramatically. The higher incomes the wage earners receive the more they qualify for financing more people. 55 and older are selling their homes and realize positive cash after the sales. So they have higher down payments or could pay cash to buy a home from us. So all of that's improving. Part of the reason our business plan works so well is there are still so many people that cannot get financed under the existing laws that we rent 8 homes for every 1 we sell. But the sales are improving. The increased incomes changes in the finance laws and the additional money people have from the appreciation that conventional homes all improve home sales.
Eugene W. Landy
I have to add to that. Samuel Landy had an award from the Manufacturing Housing Institute this year that we're very proud of. He has the Chairman's Award for his work in helping the industry demonstrate that there is a need for manufactured housing and there's a need for manufactured housing finance. We exhibited on the Washington Mall. The attendance was wonderful. The people that attended were very important people. We anticipate that there will be action in Congress and with the President. And even if it is a pilot program we think there's going to be financing available for the public so they can buy manufactured homes not paying 7% 7.5% 8% mortgages but more competitive rates to the 3.5% 4% rates you get on a conventional home.
And we know that just yesterday there were congressional hearings on this subject. And as I said I'm very proud of what Sam and the team has done. The team set up a