A Manufactured Home is a Poor Investment Because They Depreciate – Right? – – Wrong!

Today, homeownership is frequently cited as an example of attaining the American Dream. It is a symbol of financial success and independence, and it means an ability to control one’s own dwelling place instead of the whims of a landlord.

For many, the realization of that unique element of the American Dream is becoming elusive in the traditional sense (site-built homes), as the affordability gap continues to widen between hardworking low and middle-income families and those in the upper range of wage earners.

There is a form of housing that bridges that affordability gap and is “everything a home should be” – today’s modern manufactured home – which is generally equal, and often superior in every respect to a traditional site-built home and will have a cost up to 50% less than a comparably sized custom home constructed on-site.

Unfortunately, many potential home buyers never consider manufactured homes for purchase because of the preconceived notion passed down from generation to generation  that the “mobile homes” of long ago are like automobiles: “They depreciate.”

The lingering myth and the lack of quality affordable site-built housing across the country have prevented many from realizing the uniquely American dream of homeownership. Recent data has challenged that age-old notion that manufactured homes don’t appreciate in value.



A report from The Urban Insitute, a Washington, DC-based think tank, examined data released in August 2018 by the Federal Housing Agency. The home price index for manufactured homes featured an average appreciation growth rate of 3.4%, versus 3.8% for traditional site-built homes.

The statistical study indicated manufactured homes placed upon and attached to real property with loans guaranteed by Fannie Mae and Freddie Mac, but still revealing. It is a strong indication that manufactured homes may be a somewhat overlooked worthwhile investment.

Although there are limits to what the data can tell us, the index suggests a need to re-evaluate the presumption that manufactured homes do not appreciate in value at the same rate as site-built homes,” The Urban Institute researchers wrote.



The return on your manufactured home investment is determined by the same factors as a traditional site-built home, however, location is probably the most influencing consideration in determining the amount of return on that investment.

The manufactured home appreciation trend is not always easy to see, because manufactured housing is more popular in parts of the country where the overall recovery from the housing crisis has been less robust. For instance, appreciation in California has been 9.43 percent compared with a national average of 5.87 percent.

In comparison, the top five manufactured home states — Alabama, Florida, Louisiana, Nort Carolina, and Texas–which have accounted for 41 percent of the manufactured housing market since 2011, have average price appreciation below the national level, according to the FHFA indexes.

The Urban Institute report summation states, “Manufactured housing is under-represented in center cities, which have experienced the most rapid home price appreciation, and over-represented in outer suburbs and non-metropolitan areas. There are few manufactured homes in downtown San Francisco or Manhattan.” 

“Accordingly, our comparison disadvantages manufactured homes versus a measure in which we compare properties in the same area.”

This data suggests that long-held beliefs that manufactured homes don’t increase is a falsehood –and that could have major implications in the push for increased affordable housing nationwide.

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