Fitch: MH Recovery Still Far Off

The picture for the manufactured housing segment has improved, but a recovery is still far off, according to a report from Fitch Ratings.Among the positives are the purchase of Clayton Homes (Vanderbilt Mortgage) and the proposed purchase of Oakwood Homes by Berkshire Hathaway, Omaha, Neb., as well as CFN Investment Holdings' success in bringing Conseco Finance (now Green Tree Investment Holdings, St. Paul, Minn.) out of bankruptcy. Fannie Mae has also stepped up its involvement in the area, helping to bring U.S. Bank and GMAC-Residential Funding Corp., both of Minneapolis, into MH lending. But the long-term benefits of the changes are still to come, and thus Fitch expects manufactured housing to perform poorly this year, the rating agency said. "Despite CFC's emergence from Chapter 11, it will take time to determine the level of stabilization of the servicing platform, while the benefits of Berkshire Hathaway's purchase of Clayton and pending purchase of Oakwood Homes have yet to be recognized beyond the initial infusion of capital," said Jenine Fitter, a Fitch senior director. "Further, re-establishment of a full servicing operation for these new entities needs to be consistent for a longer period before its impact on performance can be judged appropriately."