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UMH Properties (UMH) Sees a Rise in Occupancy & Income in Q2
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UMH Properties’ (UMH - Free Report) recent update on its second quarter-2023 operating results reveals a promising trajectory, with a solid uptick in both home sales and rentals, leading to increased occupancy and income.
This REIT, which specializes in the ownership and operation of manufactured home communities, noted that in the second quarter, approximately 400 rental homes in inventory were occupied, and 44 new homes were sold, contributing to impressive 8.6% year-over-year growth in same-property income. The occupancy improvement was notable, with a 190-basis point increase.
The year-to-date figures are equally promising, with around 600 rental homes in inventory rented and 83 new homes sold, driving a 7.4% increase in same-property income. The current inventory of approximately 700 homes, though above normal levels, is rapidly decreasing as UMH continues to fill more than 100 homes a month.
This increased occupancy, coupled with rent increases implemented in the first and second quarters, has generated an increase in monthly rental charges of approximately $900,000 as of Jul 1, 2023 compared with Jan 1, 2023.
UMH's sales of manufactured homes have also seen a considerable boost. Second-quarter 2023 sales reached around $8.2 million, a 17% increase from the same period last year. Year-to-date gross sales have surged by 37%, reaching $15.5 million, compared with $11.3 million last year. With more than $3 million in deals in the pipeline, the demand for UMH's homes remains strong.
Financially, UMH has been proactive in managing its capital. The company raised $45.1 million of common equity and $15.6 million of preferred equity through its ATM programs during the quarter. It utilized this capital to pay down higher-cost floorplan lines. UMH also repaid all $58.5 million of its maturing mortgages, leaving no mortgage loans due next year.
These preliminary estimates indicate a strong performance. UMH's full second-quarter 2023 results will be released on Aug 8, 2023.
To conclude, UMH's strong second-quarter 2023 performance, coupled with its strategic financial management, paints a promising picture for the company's future. The increased occupancy and robust sales of manufactured homes are likely to continue driving income growth.
Further, the company's ability to raise capital and repay high-cost debts also bodes well for its financial health. These factors, combined with a strong sales pipeline, suggest a positive outlook for UMH's business and stock in the coming quarters.
However, elevated interest rates remain a concern. Also, investors should keep an eye on the full second-quarter 2023 results for a comprehensive understanding of UMH's financial health and prospects.
Shares of this Zacks Rank #3 (Hold) company have rallied 5.7% in the past three months, almost in line with its industry.
The Zacks Consensus Estimate for Invitation Homes’ current-year FFO per share has been revised 1.1% north over the past month to $1.78.
The Zacks Consensus Estimate for BRT Apartments’ 2023 FFO per share has been revised 33.6% north in the past two months to $1.55.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.
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UMH Properties (UMH) Sees a Rise in Occupancy & Income in Q2
UMH Properties’ (UMH - Free Report) recent update on its second quarter-2023 operating results reveals a promising trajectory, with a solid uptick in both home sales and rentals, leading to increased occupancy and income.
This REIT, which specializes in the ownership and operation of manufactured home communities, noted that in the second quarter, approximately 400 rental homes in inventory were occupied, and 44 new homes were sold, contributing to impressive 8.6% year-over-year growth in same-property income. The occupancy improvement was notable, with a 190-basis point increase.
The year-to-date figures are equally promising, with around 600 rental homes in inventory rented and 83 new homes sold, driving a 7.4% increase in same-property income. The current inventory of approximately 700 homes, though above normal levels, is rapidly decreasing as UMH continues to fill more than 100 homes a month.
This increased occupancy, coupled with rent increases implemented in the first and second quarters, has generated an increase in monthly rental charges of approximately $900,000 as of Jul 1, 2023 compared with Jan 1, 2023.
UMH's sales of manufactured homes have also seen a considerable boost. Second-quarter 2023 sales reached around $8.2 million, a 17% increase from the same period last year. Year-to-date gross sales have surged by 37%, reaching $15.5 million, compared with $11.3 million last year. With more than $3 million in deals in the pipeline, the demand for UMH's homes remains strong.
Financially, UMH has been proactive in managing its capital. The company raised $45.1 million of common equity and $15.6 million of preferred equity through its ATM programs during the quarter. It utilized this capital to pay down higher-cost floorplan lines. UMH also repaid all $58.5 million of its maturing mortgages, leaving no mortgage loans due next year.
These preliminary estimates indicate a strong performance. UMH's full second-quarter 2023 results will be released on Aug 8, 2023.
To conclude, UMH's strong second-quarter 2023 performance, coupled with its strategic financial management, paints a promising picture for the company's future. The increased occupancy and robust sales of manufactured homes are likely to continue driving income growth.
Further, the company's ability to raise capital and repay high-cost debts also bodes well for its financial health. These factors, combined with a strong sales pipeline, suggest a positive outlook for UMH's business and stock in the coming quarters.
However, elevated interest rates remain a concern. Also, investors should keep an eye on the full second-quarter 2023 results for a comprehensive understanding of UMH's financial health and prospects.
Shares of this Zacks Rank #3 (Hold) company have rallied 5.7% in the past three months, almost in line with its industry.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the REIT sector are Invitation Homes Inc. (INVH - Free Report) and BRT Apartments Corp. (BRT - Free Report) . While Invitation Homes currently carries a Zacks Rank #2 (Buy), BRT Apartments sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Invitation Homes’ current-year FFO per share has been revised 1.1% north over the past month to $1.78.
The Zacks Consensus Estimate for BRT Apartments’ 2023 FFO per share has been revised 33.6% north in the past two months to $1.55.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.