Affordable No More:
The connection between investors, manufactured homes and the death of mobile home parks.
Say the words, “mobile home,” and you’re likely to imagine a tiny, shabby trailer parked in the corner of a lot full of others just like it.
It’s a persistent image, but one that’s wildly out-of-date.
You might also be surprised to learn that “mobile homes,” as a legal definition, haven’t actually existed in the United States since 1976. That’s when Congress ordered HUD (U.S. Department of Housing and Urban Development) to increase safety and quality standards, creating the new category we now know as “manufactured homes.”
What do manufactured homes have to do with homelessness?
Manufactured housing has become a significant, affordable option for low-income families who are working to avoid homelessness. Here are a few data points that make the case clear:
- In Phoenix, on average, it costs about $618 per month to live in a manufactured home. Compare that to $1,100 a month or more for an average two-bedroom apartment.
- According to the Manufactured Housing Institute, a trade association, those living in manufactured housing have a median household income of just below $30,000 per year.
- It costs about $76,000 to purchase a manufactured home, compared to roughly $286,000 for a standard single-family home (not including the cost of land).
- While “mobile homes” were intended to be pulled by a car or truck, today’s manufactured housing is safe, well-made and can look almost identical to a site-built family home.
While manufactured housing production has steadily increased over the last decade, there are new and long-standing threats to the likelihood of these homes as a reliable, affordable housing option.
A long-standing threat: old attitudes and old rules
There is a stigma around manufactured or “mobile” homes that some communities are reluctant to leave in the past. Strangely, the low cost of these units is part of the problem.
Many Americans still believe that low-cost must equate to low-quality. They are quick to associate manufactured homes with the dated image of old mobile home parks. Additionally, there’s often concern that manufactured homes reduce the overall value of homes in the neighborhoods in which they’re located.
These myths connect directly to laws that are enacted in communities across the country. These laws restrict where manufactured homes can be located and can make it difficult to even site a manufactured housing park at all. Many manufactured housing home-buyers find themselves financing with loans, similar to a loan on a car, rather than a standard mortgage.
A new threat: high-end development
Across the U.S., and here in Phoenix, private equity firms and developers are looking to buy up manufactured home parks. Their goal is to convert them into luxury single-family or apartment developments.
To make matters worse, quite often, those who live in manufactured homes own the unit, but lease the land it sits upon. When a lease expires, an owner can be evicted from the land, even though the home was permanently installed. Owners are left with a dual challenge: what to do with a housing unit that’s difficult to move, and – perhaps more significantly – how to find an equally affordable housing option.
One investor in the greater Phoenix area has spent millions of dollars acquiring housing parks over the past two years. They’ve been unwilling to discuss their ultimate plans for the properties, but given their location, many experts believe higher priced, less-affordable developments are likely to be the outcome.
What can we do to protect these affordable options?
Experts suggest several approaches to preserving manufactured housing as an option for low-income working families:
- Educate elected officials at every level to release old attitudes and stereotypes around mobile homes. Manufactured housing now constitutes about 10% of the nation’s housing stock, and is home to an estimated 22 million Americans.
- Work with local officials to ease zoning and site restrictions for manufactured homes. Help them enact policies that preserve manufactured housing communities, including first right of refusal when a community is sold and protection from land rent increases.
- Encourage local lenders to offer housing loans that make it easier – not harder – for low-income families to purchase housing.
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