Next Step’s SmartMH Program

Next Step’s SmartMH Program

Next Step is a Kentucky-based nonprofit organization created in 2010 that is transforming the manufactured housing industry by educating homebuyers, increasing affordability, and enhancing energy efficiency. Next Step has a national network of more than 450 members including manufacturers, affordable housing advocates, lenders, retailers, developers, and housing counseling organizations.1 Recognizing that increasing energy efficiency in manufactured housing could result in utility savings and improved housing quality for residents, Stacey Epperson, president and founder of Next Step, launched the SmartMH program in 2015 in Kentucky. The program emerged from her observation that less than 1 percent of the manufactured homes in Kentucky met ENERGY STAR^® certification standards. Through SmartMH, Next Step identifies lenders that support the purchase of ENERGY STAR^® manufactured homes.2 In addition to increasing traditional mortgage lenders’ participation in the manufactured housing market, the SmartMH program also aims to increase the number of manufactured housing retailers in the program, expand the pool of educated homebuyers, and collaborate with nonprofit housing counseling agencies to guide prospective buyers.3

In 2017, Next Step partnered with Freddie Mac to expand the SmartMH program to North Carolina, Tennessee, Mississippi, and Texas. Representatives from Next Step train housing counselors, retailers, and lenders in these states to work with them. Next Step also partnered with eHome America in 2017 to develop an online curriculum in both English and Spanish for manufactured home buyers. A vital component of the homebuyer education course is an explanation of the long-term benefits of buying a high-quality, energy-efficient home. Upon completion of homebuyer education, lenders preapprove interested buyers for an energy-efficient manufactured home. A total of 30 lenders — both industry lenders and traditional lenders such as banks — were participating in the SmartMH program as of October 2019. These lenders refer prospective homebuyers who have difficulty securing financing to the SmartMH program.4 As of September 2019, more than 1,150 individuals were enrolled in the SmartMH program. The program also has 410 retail sales centers that refer enrollees to one of 8 HUD-certified nonprofit housing counseling organizations, where families can meet with manufactured home specialists.5

Next Step’s SmartMH and other programs and commissioned research have helped boost awareness of the need to improve the manufactured housing stock and the negative impact that inefficient homes have had on residents’ health and finances. Epperson noted that factory tours, open houses, social media, and videos sharing families’ success stories have been essential for overcoming negative perceptions and building interest in manufactured housing. In addition, leveraging cross-sector partnerships among affordable housing advocates, government agencies, housing finance organizations, and other stakeholders has been key to ensuring that communities interested in expanding and improving their manufactured housing stock have access to quality technical assistance.6

1. Next Step. "About Us" (www.nextstepus.org/about/). Accessed 20 August 2019; Next Step. 2018a. "2018 Annual Report"; Stacey Epperson and Paul Fortenberry. 2018. "Shedding the Stigma: Today's manufactured homes offer high quality, energy-efficient and  stylish options for affordable housing"; Sherry Farley and Stacey Epperson. 2016. "Manufactured housing done right with the Next Step Network."
2. Farley and Epperson; Interview with Stacey Epperson, 2 October 2019.
3. Next Step. 2018b. "Freddie Mac and Next Step Expand Manufactured Housing Education and Counseling Program"; Next Step. 2016. "2016 Annual Report."
4. Interview with Stacey Epperson; Next Step 2018b.
5. Grant Beck. 2019. "Next Step and Freddie Mac Expand Manufactured Housing Education and Counseling Program."
6. Next Step 2016: Interview with Stacey Epperson.