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7 Things to Know Before Buying a Manufactured Home

Manufactured homes can be a great, affordable option for anyone looking for a starter home, but these mobile residences are much different than traditional houses. Before you purchase one of these units, here are seven things you need to know.

1. Manufactured homes must comply with Housing and Urban Development codes.

When you purchase a manufactured home, it has to abide by the Housing and Urban Development (HUD) regulations. These codes can be fairly strict, but they’re for your benefit. The biggest rule is the date when your home is constructed. The FHA will not insure mortgages for mobile homes built before June 15th, 1976. Before purchasing anything, be sure of the manufacturing date.

2. Manufactured homes are considered personal property.

Since manufactured homes are mobile, they’re not considered “real property” like traditional houses. These residences act more like cars and boats because the title is transferred much in the same way. If the title is lost or misplaced, a new one may be purchased through the secretary of state office where the manufactured home is located. 

3. Manufactured homes have a limited market.

Since the classification of manufactured homes is “personal property,” it can be difficult to secure a loan. This situation often leaves purchasers stressed, but the Federal Housing Administration endorses several companies for which you can get a loan. The agreements for these loans are generally less generous when compared to traditional loans, so it’s important to review your contract completely before signing.

4. Manufactured homes require you to purchase or rent land.

Unlike a traditional home, you must buy or lease land that your manufactured home can rest. Property rentals are in places which are often referred to as “mobile parks,” where the rent is often so cheap that it can be difficult to say no. However, some prices may be quite high, so it’s important to consider many different plots of land before choosing one. The right plot of land can influence the price of your home over time, as well. If you decide to purchase land, the land you own may appreciate in value over time.

5. Manufactured homes can increase or decrease in value. 

The land you own can appreciate in value, but your mobile home can as well. It fluctuates based on the housing market like other traditional homes. Keep in mind that mobile homes will cost much less than other places, but if the housing market increases in price $50,000, the value of your mobile home that is located in that area will likely increase as well. While this situation is relatively rare, it is possible.

6. Manufactured homes are only allowed in certain neighborhoods.

Unfortunately, many communities don’t want manufactured homes in the area. However, some areas are set aside to take all mobile homes. These are referred to as “mobile parks,” and often have a stigma attached to them. Thankfully, some of the areas can be charming. The better the area, the more land rent will cost, but it may be a sound investment for your family.

7. Manufactured homes cost more than the basic price. 

The price of mobile homes is low, but this doesn’t mean that it’s the only cost you’ll have to pay. There are additional fees such as land rental, personal property taxes, and other such extra costs that will increase the price. Before you purchase a manufactured house, be sure that you fully understand the total cost.

Last Updated: May 16, 2016