Dear Friends,
I am pleased to share that on Wednesday, my bill, HB 1250 received a vote in the Housing and Community Development Committee and successfully passed 15-11. I introduced HB 1250 after learning how private equity companies are purchasing manufactured home communities and drastically increasing lot rents. Manufactured home communities are essential to Pennsylvania’s affordable housing infrastructure, providing homeownership options for more than 55,000 households. As I told my colleagues, there are manufactured home communities in every corner of the commonwealth, including two here in the 61st District.
Manufactured homes make homeownership a reality for many, but this form of ownership, as it is currently structured, puts homeowners at risk of financial exploitation. This is because residents own their homes, but not the land the home is on. Such homes are originally sold with a title, similar to a car, and while they are considered to be moveable, they really either are not or it is so expensive to move them as to be cost prohibitive. Like a vehicle, the value of the actual home decreases over time, and as lot rents increase, their valuation can go down further, destroying the owner’s equity and impacting their ability to sell.
We are seeing a trend in which investors acquire the property these homes occupy and increase the rent of the property year after year, ultimately pricing people out of their homes. Since I started working on this bill 5 years ago, I have spoken to many residents of communities across the commonwealth about the drastic increases in rent they face and their impact. These increases are causing residents to make choices between affording rent, affording food, and affording essential medications.
Just a few examples of the types of increases communities across the commonwealth are dealing with include Douglass Village in Douglasville, which saw a 13-15% in monthly lot rent increases each year; Stone Hill Village in Annville had a 9.7% rent increase in 2022, 10.1% in 2023, and 13.7% in 2024; and Oak Springs MHP in Cranberry Township which saw a 42% lot rent increase in 2024. These are by no means the most drastic examples of increases, as some communities are reporting significantly higher increases.
Since they have long been considered affordable housing, manufactured home communities are often a way for people to get their first home and enter the housing market and build equity, and they are a low-cost option for seniors, people with disabilities, and others on a fixed income. While I understand that the job of investment companies is to make profits, they are doing so at the expense of our most vulnerable populations at a time when the housing market is very tight and home ownership is unaffordable for many. These rent increases feel predatory in nature and once someone falls behind on rent, community owners often acquire the titles to homes on their land at very little cost and are able to sell or rent them out.
My bill seeks to end predatory behaviors by stabilizing rent increases and strengthening protections for residents in manufactured home communities, while protecting the rights of community owners. As I have worked on this bill in previous sessions, the question of the bill’s constitutionality has come up. Laws like HB 1250 are a form of price regulation where the legislature can act to protect consumers. Courts have found such legislation to be an appropriate exercise of the legislature’s police powers to protect consumers.
The United States Supreme Court has previously upheld rent stabilization laws under the Federal Due Process Clause. In Pennel v. City of San Jose (1988), the Court reviewed a rent ordinance that limited a landlord’s ability to raise rents beyond a predetermined reasonable amount (set at 8% annually) and required a landlord to proceed through a hearing process to obtain approval to raise rents beyond that amount. In the decision, Chief Justice Rehnquist, writing for the majority, stated that state price-control regulations were constitutional as long as they were not “arbitrary, discriminatory, or demonstrably irrelevant to the policy the legislature is free to adopt.” He went on to state that the ordinance’s purpose of “prevent[ing] excessive and unreasonable rent increases” caused by the “growing shortage of and increasing demand for housing” was a legitimate exercise of police powers. The Chief Justice recognized “protection of consumer welfare” was a “legitimate and rational goal of price or rate regulation.”
My bill is narrowly tailored to create a fairer system that balances the rights of property owners with the need for housing security. Increased consumer protections include required fee disclosures, so residents are not subject to surprise billing, allowing resident associations and group meetings among residents, and slightly lengthened notice timelines to give residents more amble ability to sell units if they need to move. Rent increases are tied to inflation, yet there is a provision which allows for rent increases that exceed inflation necessary to cover extraordinary increases in operating expenses through a disclosure process.
I am proud that this legislation can balance the need to protect Pennsylvanians from predatory rental practices while still allowing for growth in this market at a time when we have a shortage of affordable housing across the commonwealth. I am also grateful for Chairman Moul (R-Adams) who is a co-sponsor of this bill and a manufactured home community owner who, with great candor, helped with the drafting of this bill and discussing the challenges faced by community residents. He shared that, almost weekly, he’s offered double the value of his community by private equity firms that he knows will price out his current residents.
This bill, like so much of what we do is about developing policy, is also about dignity, stability, and protecting the people who call these communities home. I hope this bill will start further conversations about making housing affordable and attainable for those living and serving our communities, as well as protecting our vulnerable populations outside of manufactured home communities.
I expect this bill to receive a vote in the coming weeks on the House floor and I am hopeful it will pass. Please contact your Senators and urge them to call this bill up for a vote and to support it. If you live in North Wales Borough, Upper Gwynedd or Towamencin Townships, Senator Tracy Pennycuick represents you. If you are in Lower Gwynedd or Whitpain Townships, Senator Maria Collett represents you. If you have friends you think would be interested in contacting their representatives and senators to ask them to support this bill they can write them directly through this link: Take Action and write to them here!