In Buyer and Seller

Manufactured homes are buildings already in one or a few pieces that can be moved to a home site. They have been around for many years, but the design has seen quite a bit of change since the early models. While this type of home can be an effective housing solution for many, you should be aware of both the positives and negatives before making a decision.


The Pros

The main advantage for choosing a manufactured home is the low cost to purchase. This type of home costs much less than a stick-built home of the same size and style. The reason for this is partially because the home is built in a controlled environment which makes it easier for the workers to complete the job. (The Pros & Cons of Buying Manufactured Housing)

People who need a larger home may choose a manufactured house because they get more square footage for the same price than with a smaller traditional property. If they are on a limited budget, they can find nice manufactured homes that fit in their price range, whereas a stick-built property that meets their needs may be completely out of their reach.

The Cons

While a manufactured home may cost less, it is not always affordable for the buyer. Unless you have cash to pay for the entire house upfront, it can be difficult to find financing for this type of home. Many manufacturers of this home do offer in-house financing, but interest rates are often higher.

More lenders are providing financing for manufactured homes than in the past, but you will have to check with each lender to ensure they do. While manufactured homes do qualify for FHA loans, they are not included for USDA loans. Your home will also have to meet strict guidelines to meet financing restrictions, such as being set on a permanent foundation. Inspections often are more complex, and closing may take longer on this type of house. (FHA Rules for Manufactured Homes)

Another issue with cost is the fact that these homes depreciate more quickly than with frame homes. Their depreciation rates are more similar to vehicles than to real estate. (Pros & Cons of Manufactured Homes, 2015)

You will also have to pay for the cost of land separately from the house. In some areas, the property may be designed for manufactured homes, which requires only a pad payment or financing for the land. In other cases, you may need to pay for setting up utilities to the property, which can be quite costly.

The Design

The Pros

In the past, manufactured homes received a bad reputation for being built cheaply and with poor materials. Modern homes must meet strict standards to ensure they are built to last. In fact, many of them are sturdier than their traditional competition because builders can use various tools and materials they do not have access to on-site. (The Pros & Cons of Buying Manufactured Housing)

The Cons

Because manufactured home are built before you purchase and install them, you may not have as many options for customization. Buyers are given a set of floor plans from which they can choose. They also have limited choices for amenities within the home. Modifications are often not allowed and only approved when they are minor. (The Pros & Cons of Buying Manufactured Housing)

Purchasing a manufactured home may be an ideal option for you if your funds are limited. It allows you to own your own home with room for you and your family while fitting in a tight budget. At the same time, it does have restrictions and limitations you should be aware of before you decide to go this route. Buying a manufactured home is, at the very least, much better than renting. While the home is made from a mold, at least you have the home to make your own with your family. Buy now, because the power is now!

Eric Lawrence Frazier, MBA

President and CEO

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