Manufactured Homes: A Buyer’s Guide

Manufactured homes (a.k.a. prefabricating housing) are a form of housing unit that are built in factories and then delivered to building sites. In the US, the term ‘manufactured housing’ has a special meaning and refers to a house which has been built in a protected environment under a federal code by the HUD (Department of Housing and Urban Development). The term ‘mobile home’ is meant to refer to a factory built home produced prior to the 1976 HUD code enactment however the two terms are normally used interchangeably.

If you are buying a manufactured home, there are lots of factors to consider. Here at BuyingForeignProperty.com we have put together a short guide to help you through your manufactured home purchase.

Affordability
Many manufactured homes are actually sold separately to the land on which they will be placed therefore when you are looking at which home to buy, it is important to make sure you factor in land purchase or land rental into your figures.

If you are planning to buy land for your mobile home, be aware that there may be costs over and above purchase costs for example the land may need clearing, systems such as the septic system, electricity and water may need to be installed, and landscaping and driveways and pathways may need to be created, all of which will cost money.

If you are looking at putting your manufactured house into a park, there may be costs associated with this such as improvements to pathways and carports. It is wise to examine all the park rules and lease terms before you make a decision on location, most notably any allowable rent increases. Rental contracts may also include terms such as the landlord’s rights to access the inside of your manufactured home, the behaviour of children on the site, the use of clothes lines, and parking on the site.

When buying your manufactured home, you may also have to add additional transport costs onto the purchase price to allow your home to travel from the factory to your chosen site. You should always try and allow for a little leeway in your calculations for the unexpected – despite warranties, surveys have shown that some manufactured home owners have had to shell out for significant costs in the first few years of ownership.

The Design and Floor Plan
There are likely to be a few options of manufactured home open to you and it is wise to look at a range of manufactured homes in your price range to ensure you choose the right home for you. Single-section mobile homes are one main unit; Multi-section mobile homes consist of two or more units joined together.

There are different common problems associated with each style – single section homes are typically more associated with floor, roof, window and door problems; multi-section homes are typically more associated with problems related to the joining of the sections.

There are a variety of sizes available for both styles of home although single-section homes tend to be slightly cheaper than multi-section manufactured homes.

Your style and size of manufactured home may be dependent on the location you choose so ensure that you have done your research before you decide on a purchase – there may be zoning or restrictive covenants that limit mobile homes on private lots. Some rental parks may also have restrictions on the size of homes, as well as the type and appearance of the manufactured unit. Even if the rental park does not have a limit on the appearance of the home, it is wise to try and find a home which fits in well with the neighbourhood as it will probably have a higher value when you come to sell up than one which sticks out like a sore thumb.

When choosing a home, try to choose one where the roof hangs over the edge of the house and that it is properly ventilated. The overhand on the roof will prevent rainwater from getting into the walls and damaging them. If your home has an attic, ensure it is ventilated properly – if your house has a shingled roof, an unventilated attic can shorten the lifespan of the shingles or invalidate the warranty on the shingles.

If possible, the walls should have studs 16 inches apart as they will be sturdier. Vinyl is preferable over metal or hardboard sidings as manufactured homes with metal or hardboard sidings tend to have more water problems.

Loans and Financing
It is important to investigate all your financing options and not go for the first deal you are offered. This will ensure that you get the best financial deal possible. Have a look at banks as well as credit unions and traditional manufactured housing lenders. Many manufactured home dealers will use personal property loans rather than mortgage loans which means that rates are typically 2-4% higher than a normal mortgage rate.

Transportation and Installation
All manufacturers should provider their manufactured home buyers with instructions explaining how to prepare the home site and how to install and anchor their new home. Read these instructions carefully before your home is delivered and if possible, be at the site when the house is delivered. Bring the guide along with you and watch what the installer is doing.

Ensure that the installers and movers have experience of working with manufactured homes, preferably with experience of your particular make and model of home. Many manufacturers have certification for installers or can provide a factory crew to help install your new mobile home. It is a good idea to make sure whoever moves and installs your home not only has good references but also has insurance and bonds in case of damage.

Warranties
Warranties are always a good idea. Many manufacturers, retailers, installers and component manufacturers can offer separate warranties to cover most aspects of your manufactured home. Unfortunately having many different warranties can make if difficult to work out who to turn to when you do have a problem.

If you have the option of having a warranty from several people, there are two factors to consider – the length of the warranty and the cover provided by the warranty. Some warranties may exclude cosmetic items, and this term may cause debate further down the line; others may not cover the moving and installation of the manufactured home, a common time for damage to occur.

If you are buying a second hand home, these usually come with limited or no warranty. It is wise to have a professional inspect the home before you purchase it to make sure there are no hidden problems with it.

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