Manufactured Homes: a Viable Option by Jim Woodard on Creators.com

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Manufactured Homes: a Viable Option

Individuals and families who are determined to own their own home but have very limited income often opt for a mobile home. Or they may go to the next level and purchase a manufactured home. Both of these factory-built home options are significantly less expensive than a new site-built home.

Construction costs per square foot for a new manufactured home average from 10 to 35 percent less than a comparable site-built residence (excluding the cost of land), according to the Manufactured Housing Institute.

On the plus side, a manufactured home is constructed entirely in a controlled factory environment thus ensuring quality, say manufacturers. These homes are built to the federal Manufactured Home Construction and Safety Standards (known as the HUD Code). Whereas, a site-built home is constructed "on-site" using traditional building techniques that meet local or state building codes.

The HUD Code establishes a stringent series of construction and safety standards that ensure that today's manufactured homes are superior to mobile homes, according to MHI.

"Today's manufactured homes are dramatically different in appearance from mobile homes of yesterday," it was stated in a MHI report. "Manufactured homes are now indistinguishable from site-built homes and are fully compatible with any neighborhood architectural style."

Despite the added cost, many buyers prefer a traditional site-built home. They like the flexibility in room arrangements and available special features. And these traditional homes are usually located in better neighborhoods. There's still something of a negative stigma about living in a factory-built home.

Sometimes, from a terminology standpoint, manufactured homes are confused with modular homes, according to Tony Gacek with the National Association of Home Builders. "A modular home is a structure designed primarily for residential occupancy, designed and constructed to a state or national model code, which is manufactured in one or more sections in a factory for installation on a permanent foundation at its final location.

"Sections (or modules) are usually one or more rooms, complete with four walls, floor and ceiling.

The modules arrive on site with cabinets, wall finish, windows, doors, stairs, plumbing and wiring already functional. Modular homes are built to meet or exceed the same building codes as a traditional 'site-built' home," Gacek noted.

Q: Are sales of existing homes increasing or decreasing?

A: Existing home sales are on the increase, with first-time buyers driving the surge, according to a report from the National Association of Realtors. The sales volume in this housing sector has been growing substantially over the past six months.

The increasing sales volume applies to single-family homes, townhouses, condominiums and co-ops. Sales jumped by 9.4 percent in September, to an adjusted annual rate of 5.5 million units. Sales activity is now at the highest level in over two years.

"Much of the momentum is from people responding to the first-time buyer tax credit, which has been freeing many sellers to make a trade and buy another home," said Lawrence Yun, NAR's chief economist. "We are hoping the tax credit will be extended and expanded, offering the credit to at least the middle of next year. The rising sales momentum needs to continue for a few additional quarters until we reach a point of self-sustaining recovery."

Q: Where does housing stand in our overall economic recovery?

A: Housing is the bright spot in our economic landscape, according to the Federal Reserve's "Beige Book" report. More banks are willing to lend to first-time home buyers. However, commercial real estate is a weak sector, weighed down by business closures and difficulty in obtaining financing.

According to a report from the U.S. Labor Department, industries with the strongest economic gains are now residential real estate and manufacturing.

Q: Are home prices still declining in most states?

A: No, in most areas existing home prices are increasing. In fact, most metro areas in 23 states have consistently reported price increases over the past three years, according to the research and consulting firm, Fiserv.

Most areas where prices have consistently increased are in the South and Plains regions — and in the non-coastal West. The 16 states that have reported notable price declines were led by much of New England and the Northeast generally, plus coastal California, Florida, Nevada and Arizona.

To find out more about Jim Woodard and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.