Pros and Cons of Buying a Mobile Home
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Are you considering buying a manufactured home? This type of housing has pros and cons and many misconceptions, so it's essential to do your research. Fortunately, you’re in the right place.
Let’s look at some common pros and cons you’ll face when purchasing a manufactured home.
With this information, you'll be better equipped to start your research, and determine if buying a manufactured home is the right choice for you.
Manufactured Home Construction and Customization
There's a misconception that all manufactured homes are alike. While there can be "standard" packages, modern manufactured homes offer vastly different options from their predecessors. A prospective buyer can choose from a wide range of sizes and styles.
Features can include high ceilings, drywall, custom kitchens, sizable bedrooms with walk-in closets, and luxurious bathrooms with recessed bathtubs and whirlpool options. Exterior options like a porch or steps can also be added.
Once the buyer has chosen their preferred design package, it's time for construction and delivery.
Since manufactured homes are built in a factory setting, materials are on hand, and uniform quality standards are in place. That means timelines for delivery and installation are reliable.
Soon-to-be homeowners can rely on a timeline without the usual builder and developer delay commonplace in stick home construction.
Manufactured homes are more affordable than traditional homes.
Manufactured homes present a great alternative to traditional housing for those looking for quality construction but wanting to save money.
Compared to traditional homes, manufactured homes offer more features in a lower price range. Because the homes are built in a factory setting, materials are purchased in bulk and are thus less expensive than those used in stick homes. Additionally, building a manufactured home is more efficient, which translates to lower labor costs. When labor and material costs are reduced, homebuyers have a modern option at a significantly lower price point.
Those reduced costs don't mean lower standards, though. Let's look at the safety standards all manufactured homes must meet.
Manufactured homes must meet rigorous safety standards.
Although manufactured homes used to have a bad reputation, things have changed. Today's manufactured homes, constructed with cutting-edge machinery and expert craftsmanship, are far from the early mobile homes of the 1970s.
All manufactured housing must meet HUD codes of compliance implemented in 1976. This code was developed to ensure every home meets specific standards for;
- construction
- fire safety
- energy efficiency
- structural design
You can learn more about HUD standards for manufactured housing here.
Financing a manufactured home can be more complicated than a traditional home.
Financing a manufactured home can be challenging and require more legwork to find a participating lender. Once found, interest rates and down payments will likely vary from the standard quotes you've seen for market-rate traditional home purchases.
This issue mainly stems from the fact that many manufactured homes sit on land not owned by the homeowner, making the asset less secure for the lender. A large percentage of manufactured home loans are called Chattel mortgages, loans secured by the home, not the land. If you're already shopping for a manufactured home, the seller, community manager, or builder will likely have financing options to recommend. So, while it's not the same process as a traditional home loan, you'll have opportunities to consider.
Many manufactured homeowners pay lot rent rather than owning the land.
The options between paying lot rent or owning the land can be confusing for those who become manufactured homeowners. Lot rent is a standard part of manufactured housing communities, but if you're starting your research, this may be the first you've heard of it.
Finding a parcel of land that fits budget and zoning requirements can take time and effort. Often, owners decide an established community is the easier option. With that comes lot rent.
Lot rent is money you pay for the land the home sits on in a manufactured home community. You don't own the land your home sits on, so you pay someone else to use it, typically every month.
In most cases, owners find that the monthly amount paid for lot rent is preferable to buying a parcel of land outright. This makes renting a lot in an established community popular amongst manufactured homeowners on tighter budgets.
Many communities have associations created and run by their members, just like a homeowners association. Paying lot rent and community dues allows homeowners to enjoy the amenities and upkeep of the community, such as a swimming pool or maintained grounds.
Is a manufactured home the right choice for me?
Manufactured homes have become an increasingly popular option for new affordable housing. While there are some downsides to manufactured homes – such as difficulty securing financing and potentially paying lot rent – the pros may outweigh the cons for those seeking a high-quality, modern home on a budget. The best way to decide if it's the right choice is to weigh your options locally. Find a participating lender to investigate your financial options, and consider visiting local manufactured home communities in your area.
Consider the pros and cons mentioned above, and with proper research and preparation, you'll be on the way to determining if a new manufactured home is for you.