The Pros and Cons of Living in a Manufactured Home Community

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Trying to find a new place to live is no easy task. If you’re having a hard time finding a home you can afford, one option you might want to consider is buying a home in a manufactured home community. Just like any other housing option, living in a manufactured home community comes with its own set of pros and cons.

The Pros:

Very Affordable Prices

Manufactured homes are the largest source of unsubsidized housing in America. Unlike regular site-built homes, manufactured homes are built in factories,then transported to the home’s site. Manufactured homes are built using the exact same materials used to build other types of homes, but since the factory building process is much more efficient than traditional on-site building methods, manufactured homes cost less to build. This makes it possible for many people for people to become homeowners, even if they felt like it would never be possible for them.

Great Features

Contrary to what many people believe manufactured home communities are like, the reality is that many manufactured home communities are very well maintained and have nice, resort-like amenities to offer their residents, like swimming pools, playgrounds, fitness rooms, walking trails, picnic areas, and athletic courts. Manufactured homes themselves can also be quite spacious and have a wide variety of desirable features like walk-in closets, large bathtubs, separate laundry rooms, fireplaces, vaulted ceilings, decks, garages, and more.

Often More Affordable Than Apartments

When people aren’t able to afford to buy a home, they often think renting an apartment might be a better solution, but this isn’t always the case. According to one study from 2015, 52% of Americans have had to make at least one major sacrifice within the past three years to be able to afford their mortgage payment or their rent payments.

Since manufactured homes are so much less expensive than other types of housing, the monthly payments you’d make on a manufactured home that you own can be less than what it would cost to rent an apartment. You’d also have the added benefits of having much more room to work with, not having to live wall-to-wall with your neighbors, and not having to follow your landlord’s rules about things like how you can decorate.

The Cons:

You Don’t Own the Land

Most manufactured home communities operate on a land lease system, meaning that even if you own your home, you lease the land it sits on. While this arrangement offers some financial benefits, like not having to pay property taxes and making it easier to afford buying a home in the first place, it does have its downsides.

There have been some unusual cases where property values in certain areas have become so exceptionally high, it's put manufactured home communities at risk of closing because the land is so valuable to business developers. In Silicon Valley, many manufactured home communities are in danger of closing because the community owner received an offer from a developer looking to use the land to build something like an apartment building or hotel.

These communities in Silicon Valley often have a large population of older residents who have lived in the community for decades. Older manufactured homes can be very expensive and difficult, if not impossible, to relocate. Even if the displaced residents were to accept a buyout offer, they’d still be unlikely to be able to afford a new place to live in the same area.

Not owning the land means there’s also the chance that the price of lot rent can increase. However, some communities have strict rules limiting how much lot rent can go up and how often it can rise.

Home Appreciation Rates are Debatable

Many people believe that manufactured homes do not appreciate in value, but this isn’t always the case. It is possible for manufactured homes to appreciate, but manufactured homes that are placed on privately-owned lots of land generally tend to appreciate more than ones located in communities do.

However, it isn’t totally unheard of for manufactured homes in communities to appreciate in value, either. In fact, a manufactured home in a community in Malibu recently sold for over $5 million, over a million dollars more than that same home sold for a year earlier. Like any other type of home, the value of a manufactured home in a community can fluctuate based on factors like the overall real estate market in the area, how high demand is for homes in the area, and how well the home has been maintained.