6 Things to Know About Manufactured Homes
With rising home prices and limited housing supplies have left homebuyers feeling pinched, but relief may be coming from an unexpected option: Manufactured homes. Once seen as a poor substitute for a “real” house, manufactured homes are increasingly being seen as a flexible, affordable housing option that tracks with growing trends toward minimalism, downsizing, and reducing one’s ecological footprint. One survey showed that 77% of respondents had an overall positive perception of manufactured homes, and 62% said they were likely to consider purchasing one … a number that rose to 68% for millennials.
If you’re thinking about buying a manufactured home … or if you’ve never thought of it as an option … check out these fast facts on this emerging trend.
1. Manufactured homes aren’t mobile homes.
Manufactured homes and mobile homes share key similarities, but the terms are not interchangeable. In both cases, the home is built off site on a chassis and transported to a home site. But manufactured homes are typically moved once and then established on a permanent foundation, while mobile homes are designed to be moved multiple times.
2. Manufactured homes are safe and regulated.
The U.S. Department of Housing and Urban Development (HUD) administers a federal building code for manufactured homes, and all such homes must comply with HUD and local building standards covering fire resistance, energy efficiency, and safety. Manufactured homes built after 1994 are built on solid steel frames and have been designed to withstand wind speeds of up to 100 to 130 mph, depending on the model. That said, any structure can be dangerous in an extreme weather event, and it's critical for residents to understand the relative risk of their dwelling, safety measures to take in a storm, and the location of the nearest emergency shelters.
3. You can customize your floor plan and even add on a porch, deck, or garage.
Most manufactured homes are rectangular in shape, but beyond that, you’ll find a surprising array of options for square footage, features, and upgrades. Some models have vaulted ceilings, walk-in closets, recessed bathtubs, hardwood floors, ceiling fans, and enhanced insulation and energy efficiency. Bottom line … these are not the flimsy, shotgun-style trailer homes of yesteryear.
4. Finding a location for a manufactured home takes some effort … and cost.
Because a manufactured home doesn’t come with a lot, you’ll need to rent space in a home park or buy land on which to establish a home site. If you’re renting a space, you need to fully understand your rights and obligations, as well as the potential for future rent increases. Consult with a local housing authority to make sure you know the laws of your state, county, and municipality and how you are protected as a tenant. If you’re buying land, you’ll need a site survey and all applicable permits before building your permanent foundation, and you’ll need to arrange for utilities. If you can’t connect to existing water, electrical, and sewage systems, your build is going to be considerably more complex and expensive. Ultimately, the real estate maxim of “location, location, location” applies as much to manufactured homes as site-built homes!
5. Manufactured homes aren’t limited to rural areas.
State and local laws, ordinances, and permit regulations define where and how a manufactured home can be installed, so unfortunately, there’s a patchwork of legal requirements nationwide. That said, as home affordability becomes more of a societal issue, some cities and suburbs are reconsidering how to incorporate manufactured housing into existing infrastructure.
6. In certain cases, you can get a mortgage for a manufactured home.
There are FHA, VA, Fannie Mae, and Freddie Mac loans available for certain types of manufactured homes, but qualifications vary, so talk to a loan officer about your personal situation. Other options include personal loans and chattel loans, which come with a higher interest rate but can be used even if you will be renting the land on which the home sits.