Cedarhill Success Story

The most recent variety of park conversion was accomplished through the joint efforts of the owners of the park, The Associates Group for Affordable Housing, Inc. (TAG) and The Gibbs Law Firm, APC. After consultation with the law firm, it was decided that the best method for the sale of the park was a full subdivision, in which each space would be converted to an individual lot. In that process, we also added the proviso that each home be equipped with a foundation system or one was provided with the lot. This element was important as it relates to the inherent security in the unsold lots as well as the financing rates.

In December 1999, 172 of the 281 resident families of Cedarhill Mobile Country Club, located in Fullerton, California, purchased their individual lots from The Associates Group for Affordable Housing, Inc., at an average price of $69,000.00. The subdivision of the park was accomplished through the original park owners, who employed The Gibbs Law Firm, APC, to process the subdivision through the city and state agencies. In this particular instance, the result was a “fully subdivided project’, where each space in the park became a lot owned by the purchasers. The common area was deeded to the newly formed homeowners’ association, whose only members are lot-owners. The homeowners’ association manages the common area for the benefit of its members.

The park, once subdivided, was sold to The Associates Group for Affordable Housing, Inc. (TAG). TAG then resold the individual 172 lots to those who were willing and able to purchase. The residents were provided financing through a number of sources, but the financing was similar to that accorded single-family dwellings, not mobilehomes. TAG retained the unsold lots, and continued to rent them to the then homeowners. Over time, many additional homeowners have also purchased, or if they left the park, their buyers purchased the lots from TAG, and the homes from the residents.

The new homeowners received the prior park owners “Proposition 13” tax basis which amounted to about $150 per year for the real estate. In addition, these same people then filed for a homeowners exemption and now pay about $78 per year for the taxes on the lot. The tax on the home did go up by some amount as a result of its transfer to the tax rolls. If it was a typical older home, it went up slightly. If it was a newer home and already on the tax roll, it did not go up at all.

TAG has maintained the rental spaces, and is presently providing subsidies to those who are very low-income families. In January 2003, only 30 lots remained unsold.

The park owners were able to pay for the cost of the subdivision, and have reaped the benefit of their investment. The homeowners have seen the value of their homes go from $35,000.00 to $75,000.00. The lots have increased in value by 60%; all the while, the project still remains affordable and a suitable alternative to other, much more costly housing in Orange County, California.

Residents have been able to refinance their homes and lots during the low interest cycle, and taken out money for their own benefit. Those who purchased and later left, have seen their home equity increase dramatically.

Because the park owners not only paid for the subdivision, but also advanced funds for TAG to carry back unsold lots, they were provided an additional reward by sharing in the appreciation of the unsold lots. It has been a success story for the sellers, the residents, the non-buyers and community at large.

As with all conversions that are properly implemented, pride of ownership is reflected throughout the park. Even though this park was outstanding prior to the purchase, the residents are making it better.

For your information, I suggest you may wish to contact:

Howard Brigham, former park owner
(714) 792-0628
Jim Murdock, present park management firm
(805) 569-0048
Dick Madison, present board member
(714) 993-5000
Because of the additional sales to be accomplished, TAG has had a super majority of votes available. Initially, however, TAG assigned two of the five seats to residents. The third seat was given to the residents when sales reached 80% of the lots.

The residents have also gained by the presence of TAG officials on the board. The board is now very mature and able to respond to the many needs of the community.