U.S. may expand Nvidia and AMD’s 15% China chips deal to other companies
Introduction & Market Context
UMH Properties, Inc. (NYSE:UMH) presented its Q2 2025 investor update on August 7, 2025, highlighting a strong performance following a disappointing first quarter. The manufactured housing REIT, which has been operating since 1968, showcased significant growth across key metrics as it continues to capitalize on the persistent affordable housing shortage in the United States.
The company’s presentation emphasized favorable housing market conditions that support its business model. With the gap between buying and renting costs continuing to widen, UMH’s affordable housing options remain in high demand.
As shown in the following chart illustrating the growing disparity between buying and renting costs:
The company noted that higher mortgage rates have incentivized homeowners to stay put, reducing housing supply while driving prices higher. UMH highlighted that the average cost of a manufactured home is approximately $127,000, compared to $413,000 for a site-built home, positioning the company well in the affordable housing segment.
Quarterly Performance Highlights
UMH reported substantial improvements in Q2 2025, with rental and related income increasing by 9% compared to the same period last year. Sales of manufactured homes grew by 19%, while Community Net Operating Income (NOI) rose by 11%. Perhaps most notably, Normalized Funds from Operations (Normalized FFO) increased by 16%, signaling a potential recovery after missing analyst expectations in Q1.
The following slide summarizes these key quarterly accomplishments:
Same property metrics also showed strong performance, with same property community NOI increasing by 9.9% for the three months ended June 30, 2025, compared to the same period in 2024. Same property occupancy improved by 80 basis points, rising from 87.4% to 88.2%.
The detailed breakdown of same property net operating income reveals the drivers behind this growth:
This performance represents a significant improvement from Q1 2025, when UMH reported an EPS of $0.00, missing the forecast of $0.036, and revenue of $61.23 million against a projected $62.88 million.
Portfolio Growth and Expansion Strategy
UMH’s portfolio now consists of 144 manufactured home communities with approximately 26,800 developed homesites across 12 states. The company maintains a rental portfolio of approximately 10,600 units with a strong occupancy rate of 94.4%.
The following portfolio snapshot provides a comprehensive overview of UMH’s geographic distribution and key statistics:
The company’s growth strategy includes multiple avenues for expansion. UMH has 3,100 existing vacant lots to fill and approximately 2,287 acres of vacant land available for future development. The company also continues to pursue acquisitions, having added 4 communities and 500 sites in 2025 so far.
As illustrated in the portfolio growth chart, UMH has steadily expanded its total sites and rental units over the past five years:
The company’s rental unit strategy appears particularly promising, with historical data showing consistent growth in both the number of units and average monthly rents. UMH presented an illustrative analysis suggesting potential gross unlevered returns on investment of over 11% from new rental units:
Financial Position and Outlook
UMH highlighted its five-year financial performance, showing a 59% increase in total revenue, a 79% increase in community NOI, and a 176% increase in normalized FFO since 2019. On a per-share basis, normalized FFO has grown by 48% over the same period.
The following chart illustrates this impressive financial growth trajectory:
For full-year 2025, UMH maintained its guidance for normalized FFO per share between $0.96 and $1.04, with a midpoint of $1.00. Key assumptions include rent increases of 5% and occupancy of 800 rental units during the year.
The company also raised its quarterly common stock dividend by $0.01 to $0.225 per share, representing a 4.7% increase. This continues UMH’s track record of dividend growth, with the dividend having increased by 25% over the past five years.
Despite these positive developments, UMH’s current stock price of $16.48 (as of August 7, 2025) remains below the $17.70 level reported after Q1 earnings, suggesting that investors may still have concerns about the company’s ability to meet full-year targets.
Strategic Initiatives
UMH continues to focus on several strategic initiatives to drive growth. The company is actively expanding its rental unit portfolio, which has proven to be a reliable source of income growth. With average monthly home rents of $1,016 in Q2 2025, this segment offers attractive returns.
The company is also capitalizing on its exposure to the Marcellus and Utica Shale regions, where development is expected to accelerate and benefit local economies. UMH added 237 rental homes in these regions during the first six months of 2025 and has approximately 4,000 acres in existing communities in these areas.
As shown in the following breakdown of UMH’s presence in the shale regions:
Additionally, UMH is pursuing sustainability initiatives, which it views as both environmentally responsible and economically beneficial. The company has formed strategic alliances with various organizations to advance these efforts.
UMH also continues to leverage its wholly-owned taxable REIT subsidiary, UMH Sales & Finance, Inc., which has sold approximately 6,100 homes since 1996 and maintains a loan portfolio of approximately $95.3 million.
With its multi-faceted growth strategy, strong Q2 2025 performance, and favorable positioning in the affordable housing market, UMH appears to be regaining momentum after a challenging start to the year. However, investors will likely be watching closely to see if the company can maintain this positive trajectory and meet its full-year guidance.
Full presentation:
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.