MANUFACTURED HOME PRODUCTION PROJECTED TO HIT 15-YEAR HIGH AS AFFORDABILITY GAP WIDENS
February 05, 2022 - By: Wil Ferguson
As the housing sector grapples with widespread affordability and supply issues, an alternative is gaining ground: Manufactured homes.
According to the U.S. Census Bureau, manufactured home builders are expected to deliver more than 100,000 new homes for the first time since 2006. Manufactured homes assembled in a factory before they’re installed on-site, offering some practical advantages to traditional on-site home construction, according to a report by The Real Deal.
The manufactured housing industry is not immune from the traditional site-built home builder facing worsening labor shortages, supply chain interruptions, and increasing prices. However, manufactured home supply and capacity have not been as adversely affected by those conditions plaguing site-home builders. The price differential between site-built construction and factory-built housing continues to widen, which is part of why manufactured homes offer a quality affordable homeownership solution for low and middle-income families across the U.S.
Manufactured homes are proving to be much less expensive than those constructed on-site and are at least equal, and often superior in quality of construction and other aspects of owning a home.
In 2020, the average home built on-site reportedly sold for $392,000, or $309, when excluding underlying land costs. Manufactured homes without land were averaging $87,000 the same year, according to the Wall Street Journal.
Still, the more affordable alternative could provide a path to homeownership to those blocked out by the hot housing market. According to the Journal, only 21 percent of new site-built homes in September sold for less than $300,000, still, a considerable premium of last year’s average manufactured home sale.
According to the U.S. Census Bureau, the 2021 cost of a new manufactured home is $57 per square foot with the cost of a comparable new site-built home at $119 per square foot. The nationwide average selling price of a new manufactured home, not including land costs, is $81,900 (MHI 2021), compared to the average selling price of a site-built home hitting a record-high of $385,000, land included, in June 2021, according to Realtor.com data.
Manufactured homes represent approximately 9 percent of new single-family home construction, the National Association of Homebuilders reports.
Technology advances, evolutionary designs, and a focus on delivering quality homes that families can afford are the driving forces within the manufactured housing industry. That’s why more people are turning to manufactured housing to deliver homes that homebuyers want and need, at prices they can afford.