There’s a growing interest in the manufactured housing sector from both tenants and investors. The coronavirus pandemic has made a significant impact on several industries including the hospitality and leisure sectors while worsening the conditions of local housing efforts. As a result, more and more people are turning to manufactured homes as an alternative solution to the housing crisis.
Manufactured homes, more commonly known to others as mobile or trailer homes, are not that different from traditional single-family residences. These homes are built in compliance with HUD regulations, with the added bonus of the homeowner being able to choose exactly where he (or she) wants it located. Many financial institutions and private investors are already aware of the current trend, offering affordable rates for people interested in owning a newly-manufactured home.
A lot of people still have doubts regarding the viability of manufactured homes, and it’s understandable given the fact that there are several myths running around regarding mobile housing. To better educate you on the truths of manufactured houses, here are the most common misconceptions that people have about the industry:
1. Manufactured homes are hard to finance.
One of the myths about manufactured homes is that they are difficult to finance. This wasn’t really a myth several years ago because a lot of financial institutions and private lenders weren’t that comfortable yet trusting the manufactured housing industry with financing loans. However, both private and government-sponsored financial enterprises have ramped up financing manufacturing homes through the years, and right now financing a manufactured home is no more challenging than a traditional house.
In 2019, the Federal National Mortgage Association, better known as Fannie Mae, closed no less than $2.5 billion in loans for manufactured homes. While this is slightly lower than their 2018 volume that reached $2.9 billion, it’s still a considerable jump from 2017’s $1.9 billion turnouts. These numbers are hard proof that manufactured homes are just as viable when it comes to financing concerns.
2. Manufactured houses are built with poor quality standards.
If anything, the construction rules for manufactured homes are actually stricter than standard houses. Not only are they required to pass the standard of HUD’s Manufactured Home Construction and Safety Standards code, they should also withstand transportation because they are meant to be mobile. As such, additional sturdiness and durability is necessary before it can be approved for sale.
Many people also believe that manufactured homes depreciate faster than traditional homes. The truth is, both types of housing are prone to the same reasons for depreciation. If you don’t take care of your house, regardless of what kind it is, its value will surely decrease over time due to wear and tear, weather damages, and other reasons. The location also plays a role in depreciation, as communities are crucial in determining the value of a residential area.
3. Manufactured homes are a bad investment.
The pandemic has only increased the demand for manufactured homes by accelerating the need for people to secure affordable housing. The manufacturing homes industry has received increasing investments in this year alone, clocking in a 23% increase in just the second quarter.
Manufactured homes are a safe investment even in times of crisis, as shown by the low turnover and high rent in manufactured communities during the pandemic. According to JLL data, the stability occupancy of manufactured homes is 93.5% nationally for the first quarter of 2020, which is all-time record even including traditional houses.
A Final Word About Manufactured Homes
In these uncertain times, it is important to secure a place of residence at a modest price. Manufactured homes provide the advantage of lower costs while allowing you to enjoy the same benefits of a traditional house, if not more. If you are interested in owning a manufactured home in a community of your choice, Storz Realty can help you look into several affordable options with friendly financing rates to make homeownership easier to achieve.