Warren Buffett's Exploitative Mobile Home Investment
Warren Buffett’s company Clayton Homes, the biggest mobile home manufacturer in the U.S., has continued to profit from high interest rate loans.
The Oracle of Omaha has sold low-income Americans the dream of ownership for nearly 20 years, and
his investment company Berkshire Hathaway makes money on the loans,
since they own the company that Clayton urges its buyers to go through.
Many of the people buying these homes are minorities and have helped to fuel Clayton’s $13.7 billion mortgage portfolio.
Interest rates can be as high as 13.5% or more, and
like a vehicle, lose as much as half its value in three years.
These rates make it hard for mobile-home owners to leverage equity from their purchase in order to buy a traditional home.
The majority of mobile-home residents, 23% are between the ages of 18 to 29 and have an average household income of $28,400.
If that’s not alarming enough, in 2015, the average sales price for a new manufactured double-wide home was around $110,000.
https://www.forbes.com/sites/korihale/2019/04/18/warren-buffets-exploitative-mobile-home-investment