Every manufactured housing community operator lives with a question almost no other real estate asset class has to answer: do you own the buildings sitting on your land, or does somebody else?

In a land-lease community, both answers are normal. The home on homesite 47 might belong to the resident living in it. The identical home on homesite 48 might belong to you. Both cheques arrive on the first of the month. The economics behind them are not remotely the same.

Get the mix right and you have one of the most durable cash flows in American real estate. Get it wrong and you have quietly converted a land business into an appliance-repair business with a depreciating inventory attached.

Key takeaways

• A park-owned home (POH) is owned by the community and rented to a resident. A tenant-owned home (TOH) is owned by the resident, who leases only the homesite.
• The two largest US public manufactured housing REITs sit at 41% and 2.9% park-owned home intensity — a 14x spread in the same asset class. There is no industry consensus, only deliberate strategy.
• POH lifts gross revenue per homesite. It also brings maintenance, turnover, insurance, capital and depreciation that lot rent does not.
• Buyers and lenders routinely discount POH income because it comes from a depreciating asset rather than from land.
• Federal tax treats a rented manufactured home as 27.5-year residential rental property — a building on your balance sheet, not a line on a rent roll. Most property management software cannot model this at all.
• POH exists because of a financing gap: residents on leased land are excluded from the main GSE loan programmes and pay far more for home-only credit.

What is a park-owned home (POH)?

A park-owned home is a manufactured home that the community owns and rents to a resident. The resident pays a single monthly amount covering both the home and the homesite it occupies, and the community maintains the home itself — roof, furnace, water heater, appliances, flooring, everything inside the walls.

You will also see these called community-owned homes, rental homes, or in REIT disclosures "leased homes". The abbreviation POH is universal among operators and almost never appears in software marketing, which tells you something about how well most platforms handle it.

What is a tenant-owned home (TOH)?

A tenant-owned home is a manufactured home owned by the resident, who leases only the homesite beneath it from the community. The resident holds title to the home, pays lot rent for the land, and maintains the home. The community maintains roads, utilities, common areas and infrastructure.

TOH is also called a resident-owned home (ROH). The terms are interchangeable. Do not confuse either with a resident-owned community (ROC), which is something else entirely — a community whose land has been bought collectively by its residents, usually through a cooperative.

POH vs TOH at a glance

What the public REITs reveal about the POH decision

Most writing about park-owned homes is opinion. Publicly traded manufactured housing REITs have to disclose their actual positions, and those disclosures are the clearest evidence available about how sophisticated operators think.

The two clearest cases sit at opposite ends of the same asset class. Figures are as of 31 December 2025, from FY2025 annual filings.

Sources: UMH Properties FY2025 Form 10-K (filed 25 Feb 2026); ELS FY2025 Form 10-K and ELS Q4 2025 results, 28 Jan 2026.

A 14x spread, in the same asset class, between two companies with access to the same capital markets. That is not an accident and it is not a disagreement about arithmetic. It is two different answers to the same strategic question — and most private operators sit somewhere on the line between them.

UMH: POH as an occupancy weapon

UMH is the heaviest rental-home operator in the sector, and its own 10-K explains why in a single sentence:

"The Company engages in the rental of homes primarily in areas where the communities have existing vacancies. The rental homes produce income from both the home and the site which might otherwise be non-income producing."
— UMH Properties, FY2025 Form 10-K

That is the entire POH business case, stated by the largest practitioner of it. A vacant homesite earns nothing. If nobody will move a home onto it or buy one outright, a community-owned home converts a zero into two revenue streams. UMH added 717 new rental homes in 2025 and reports rental-home occupancy of 93.8% against same-property site occupancy of 88.3% — the rental homes are, quite literally, filling the gap.

ELS: POH as something to avoid

ELS runs 73,600 MH sites with just 2,111 rental homes and generated only $35.8 million of rental operations revenue in FY2025. It has essentially opted out of the model, relying instead on high-barrier locations and 94.3% core MH occupancy.

The middle ground: POH as a conversion pipeline

Between those poles sits the position most private operators occupy — a deliberate but bounded rental-home programme treated as a pipeline rather than a destination. A resident who cannot qualify for home financing today may qualify in two years with a documented payment history behind them. Renting them a community-owned home houses them now, seasons their payment record, and creates a qualified buyer for that same home later.

The read-across for your own portfolio: POH intensity should be a deliberate number you can defend, not a residue of repossessions nobody dealt with. If you cannot state your target POH share and the reason for it, you do not have a strategy — you have an accumulation.

How the two models change your numbers

The comparison that matters is not POH versus vacancy — filling a vacant homesite always beats leaving it empty. It is POH versus selling that same home to the resident.

Take one homesite where lot rent is at the 2025 national average of $782 per month (MHInsider, citing Datacomp/JLT, 2025). Assume the community owns a home on it that would rent for an additional $450 a month, or sell to the resident for $35,000.

*All figures below are illustrative assumptions, not published benchmarks. Substitute your own home cost, rehab history, turn frequency and market lot rent before relying on the conclusion.

Read the last two rows together, because that is where the decision lives.

The POH generates $2,600 more cash per year. It also ties up $45,000 of capital, forgoes $35,000 of immediate proceeds, and — because the income is capitalised at a worse rate — produces roughly $23,000 less enterprise value than the same homesite with a resident-owned home on it.

You are spending $45,000 to buy $2,600 a year and destroy $23,000 of value at exit. That is defensible when the alternative is a vacant lot. It is much harder to defend when the alternative is a resident with $35,000 and a willingness to buy.

If NOI mechanics are unfamiliar territory, our primer on what net operating income is and how it is calculated covers the fundamentals, and the capitalisation rate primer explains why the rate applied to income matters as much as the income itself.

Why buyers and lenders discount park-owned home income

When you sell, a sophisticated buyer will not apply your community's cap rate to POH income. Expect one of three treatments:

1. A separate, higher cap rate on POH income, reflecting a depreciating asset with a finite useful life.
2. A haircut to POH revenue before capitalising it, to reflect the fully-loaded cost of running rental homes rather than the cost the seller reported.
3. Valuation of the homes at or near book value, separately from the income approach applied to lot rent.

The logic is straightforward. Lot rent is land rent — it does not wear out. A 1998 single-section home does. A buyer paying a 6% cap rate on lot rent is buying an asset with an indefinite life; applying that multiple to home rental income would mean paying land prices for a structure with a roof that needs replacing.

Lenders reason identically. Many size a loan primarily against lot rent income and either exclude POH income or count a conservative fraction of it. If your acquisition model assumes full credit for POH revenue, confirm that with your lender before you sign.

For context, median transaction pricing reached $58,400 per homesite in Q1 2026, up 12% year over year on volume up 26% (Northmarq, June 2026). Cap rates are contested — Northmarq recorded roughly 5.9% on closed institutional transactions in the first half of 2025, while broader national averages including smaller parks have run nearer 8%. Use a range, name the source, and never underwrite off a single headline number.

The sentence to remember: a dollar of lot rent is worth substantially more in enterprise value than a dollar of park-owned home rent.

The accounting difference most operators get wrong

This is where POH stops being an operating preference and becomes a systems problem.

A tenant-owned homesite produces exactly one thing: lease revenue. No book value, no depreciation schedule, no disposal event.

A park-owned home is a capital asset — acquisition cost, in-service date, useful life, depreciation method, accumulated depreciation, net book value, and eventually a disposal when it is sold to a resident, sold for removal or scrapped. Every one of those is a general ledger event affecting both your taxable income and your balance sheet.

The federal treatment is explicit. IRS Publication 527, defining 27.5-year residential rental property under MACRS, includes "any real property that is a rental building or structure (including a mobile home) for which 80% or more of the gross rental income for the tax year is from dwelling units" (IRS Publication 527).

Three consequences operators get wrong regularly:

• Federal tax classification and state titling are independent. Your state DMV may treat the home as personal property with a vehicle-style certificate of title. The IRS treats it as a residential rental building. Both are true at once.
• Site improvements are a different class. The home is 27.5-year property, land is not depreciable, and pads, utility runs, roads and landscaping are generally 15-year land improvements. A POH programme puts all three classes on the books simultaneously.
• Rehab spend splits. Replacing a failed water heater is generally a repair; re-roofing or a renovation that extends useful life is generally capital. You need a written capitalisation policy applied when the invoice is coded, not reconstructed at year end — our guide to separating CapEx from OpEx covers how to enforce that in a system.

Depreciation treatment depends on your specific facts, including whether homes are held for rent or as inventory for sale. Confirm with your tax adviser. We cover journal entries, useful-life tables and disposal mechanics in full in our guide to park-owned home accounting, and the posting side in fixed asset depreciation for real estate and property disposition accounting.

Where systems break

A conventional property management platform models the world as units with leases. A manufactured housing community is two overlapping registers: homesites you lease out, and homes you may or may not own. When software can only represent one, operators either force the homes into the units table and lose the asset accounting, or run a parallel spreadsheet and lose the single source of truth. Both are common. Both are expensive.

Why residents can't simply buy the home

Before judging any operator's POH share, understand the constraint. Most residents in land-lease communities cannot get a normal mortgage, and the reason is structural rather than personal.

Fannie Mae's Selling Guide requires a manufactured housing loan be "secured by both the manufactured home and the borrower's interest in the land", and explicitly excludes "manufactured homes located on leased land and subject to a ground lease" (Selling Guide B5-2-02, December 2025). Freddie Mac imposes materially the same requirement. MH Advantage and CHOICEHome are therefore unavailable to a resident in a conventional land-lease community — not because of their credit, but because they do not own the ground.

What is left is chattel, or home-only, lending: median rates of 8.5% versus 5.4% for manufactured home mortgages, and denial rates near 64% (Pew Charitable Trusts, 2025 and 2026).

This is the gap POH fills. When two of every three home-only applications are denied, a community-owned rental home is often the only way to house a working household on a vacant homesite. Our guide to chattel loans for community operators covers the lender landscape and how to build referral relationships that make conversions actually close.

When POH is the right answer

• Infill: A vacant homesite earns nothing. A community-owned home converts zero into revenue on both the home and the site. Occupancy is also what buyers price, so filled sites carry value beyond their own cash flow.

• Repossessions and abandonments: Homes come back. When a resident abandons a home and you complete your state's statutory process to take title, you own a home whether you wanted to or not.

• Markets with no home-buying demand: Where residents cannot access financing, a rental home is the only way to house them.

The distinction that matters is strategic POH versus accumulated POH. Strategic POH is a deliberate infill programme with a defined conversion path and a target share. Accumulated POH is what happens when repossessions pile up and nobody owns the problem. The first creates value. The second is a worsening expense ratio that shows up as a valuation discount on the day you sell.

Converting POH to TOH

The standard value-add sequence is to acquire a community with POH exposure and convert those homes to resident ownership over a multi-year hold. Three routes:

• Outright sale. The resident buys for cash or third-party chattel financing. Cleanest for you — title transfers, the asset leaves your books, the homesite converts to pure lot rent. Hardest for the resident, given the denial rates above.
• Rent-to-own. The resident pays toward ownership over a defined term, with title transferring at the end. The most common route because it works for residents who cannot qualify elsewhere.
• In-house financing. You hold the paper. Higher yield and full control of underwriting, but you become a lender — interest calculation, amortisation, lien perfection, default handling, and in most states some level of licensing. Not without counsel.

Rent-to-own is now a regulated product, not a handshake. New York has required written contracts, independent valuation, retained habitability responsibility and full refunds on wrongful termination since 2019 under Real Property Law §233. Colorado's HB24-1294 followed in June 2024 with proof-of-ownership disclosure, appraisal rights, termination limits, a ban on prepayment penalties and treble damages for wrongful eviction. Given how closely Colorado tracked New York's language, assume the model spreads — build the disclosures into your contract template now rather than into a community manager's memory. Our rent-to-own guide covers the full state-by-state position, and the Iowa Chapter 562B guide shows how differently states treat manufactured housing tenancies generally.

Whichever route you take, four record sets have to reconcile: home inventory (serial and HUD label numbers, manufacturer, model, section count, wind zone, condition), ownership and title, liens, and asset accounting (cost, accumulated depreciation, book value, disposal). Homes in land-lease communities are in most states titled as personal property with a vehicle-style certificate, because real-property conversion generally requires both a permanent foundation and ownership of the land (Pew, 2026). The mechanics are covered in manufactured home titles: transfer, lien perfection and retirement, and the full conversion playbook in converting POH to TOH.

The step operators skip is the last one: track the pipeline. A conversion programme is a sales pipeline and needs the same discipline — stages, owners, dates, forecast. If it lives in a manager's notebook, it will not finish.

How RIOO models homes and homesites separately

RIOO is a property management platform built natively on Oracle NetSuite, and manufactured housing is the clearest case for why that architecture matters. The dual-asset problem at the centre of this article is not a reporting inconvenience. It is an accounting problem, and accounting problems need an accounting system.

In a conventional platform, a park-owned home gets forced into a unit lease record. That single design decision severs the physical asset from the general ledger: the home earns rent in one system and depreciates in another, and nothing reconciles the two. NetSuite closes that gap because both halves live in the same ledger — Fixed Asset Management carries the home's cost, depreciation and disposal, while AR and AP carry the rent it earns and the money it consumes. Same home, same record, same books.

• Homesites carry lot leases, lot rent, escalations, occupancy, utility recovery and violation history.
• Park-owned homes are fixed assets with cost, in-service date, depreciation schedule, book value and disposal — inside NetSuite Fixed Asset Management, not a side spreadsheet.
• Home records hold serial and HUD label numbers, manufacturer, model, section count, wind zone and condition, with titles and liens tracked against the home and documents attached.
• One receivable per resident. Lot rent and home rent bill from the same resident record to a single AR ledger, so a POH resident is one balance and one ageing line. On the payable side, rehab spend, vendor bills and work order costs all post against the home they belong to.
• Multi-entity consolidation handles the LLC-per-community structure most operators run, producing investor and lender reporting from source data rather than a spreadsheet roll-up.

The result is that the answer to "what is our POH portfolio worth, what did it cost us last year, and which homes should we sell first" is a report you run — not a project you commission.

If you carry park-owned home exposure across multiple communities and multiple entities and would like to see what that looks like in one system, book a demo.

Conclusion: decide the number, then defend it

Park-owned homes are not a mistake and tenant-owned homes are not automatically superior. They are two different businesses that happen to occupy the same land.

Lot rent is land income — almost no incremental cost, no capital, survives turnover, capitalises at the community's full rate. Home rent is operating income from a depreciating asset. It pays more per month and costs more in every other way.

The public REITs prove there is no single right answer. UMH runs 41% park-owned and uses it deliberately to fill homesites that would otherwise earn nothing. ELS runs 2.9% and has effectively opted out. Both are defensible, and most private operators sit between them. What neither has is an accidental number.

So the question is not "should I own the homes?" It is:

1. What is my park-owned share, community by community, right now?
2. Is that number a decision, or repossessions nobody dealt with?
3. What is the fully-loaded cost of each home, including depreciation — actual, not budgeted?
4. For every home I hold, what is the path out, at what price, by when?

Operators who can answer all four are running a strategy. Operators who cannot are carrying an expense ratio that will show up as a valuation discount on the day they sell — and by then it is priced in, not fixable.

The homes on your land are either an asset class you manage or an inventory you have accumulated. The difference is entirely a matter of whether you are counting them properly.

Frequently asked questions

Q1. What does POH mean in a mobile home park?
POH stands for park-owned home: a manufactured home owned by the community rather than the resident. The resident rents both the home and the homesite from the community, and the community is responsible for maintaining the home.

Q2. What does TOH mean in manufactured housing?
TOH stands for tenant-owned home: a manufactured home owned by the resident, who leases only the homesite beneath it. The resident maintains the home and pays lot rent for the land. It is also called a resident-owned home (ROH).

Q3. Is POH or TOH more profitable?
POH generates higher gross revenue per homesite, but TOH usually produces stronger risk-adjusted returns and higher enterprise value. Lot rent carries almost no incremental expense, requires no capital, and is capitalised at a better rate than income from a depreciating home.

Q4. Why do buyers discount park-owned home income?
Because it comes from a depreciating asset rather than from land. Applying a land cap rate to home rental income would mean paying land prices for a structure with a finite useful life. Buyers typically apply a separate higher cap rate, haircut the revenue, or value the homes near book value.

Q5. How are park-owned homes depreciated?
IRS Publication 527 places a rental building or structure "including a mobile home" in the 27.5-year residential rental property class under MACRS, provided at least 80% of gross rental income comes from dwelling units. Site improvements such as pads and roads are generally 15-year land improvements. Confirm treatment with your tax adviser, as it depends on whether homes are held for rent or as inventory.

Q6. How do you convert a park-owned home to a tenant-owned home?
Through outright sale, a rent-to-own contract, or in-house seller financing. Inventory and grade the homes, price by condition, arrange financing, meet your state's disclosure requirements, transfer title through the state titling authority, and retire the asset from your fixed asset register.

Q7. Why don't residents just buy their homes with a mortgage?
Because most cannot. Fannie Mae and Freddie Mac both require the home and the land to be financed together and titled as real property, which excludes residents of conventional land-lease communities from MH Advantage and CHOICEHome. They are left with home-only (chattel) loans, which Pew found carry median rates around 3.1 points higher and denial rates near 64%.

Q8. Can property management software handle both park-owned and tenant-owned homes?
Most cannot handle both properly. Conventional platforms model "units with leases", which forces a park-owned home into a rent-roll line and loses the asset accounting entirely. Handling both requires the homesite and the home to exist as separate records, with a real fixed asset register behind the home.

Q9. What is a good POH percentage for a manufactured housing community?
There is no industry standard — the two largest public MH REITs sit at roughly 41% and 2.9%. What matters is that your share is deliberate and defensible for each community, with a documented conversion path, rather than an accumulation of repossessions nobody has addressed.

RIOO is a property management platform built natively on Oracle NetSuite, used by manufactured housing community operators to manage homesites, lot rent, park-owned homes, utility recovery and multi-entity accounting in one system.