The Rise and Fall of the Manufactured Home – Part I

I believe that is because when you finance a house you're financing the land+house combination, with the land making up the majority of value in most urban areas - when you finance a mobile home you are only financing the home, which depreciates (unlike the land component) - hence its a higher risk loan and therefore more expensive to finance.

I worked for at a loan center about 20 years ago. We had strict rules about lending for mobile homes, which essentially meant no one got a loan for a manufactured home. Which meant you weren’t getting competitive rates for home mortgages, and you can imagine that it just goes downhill from there.

Nice 3 story home.

It looks to be in an unpopulated area. Building offsite using prefabricated elements would make sense even it it were quite costly, because getting builders and tradies out to a wop-wop location to do an on-site build would be even more expensive.

That sort of thing, and one’s where there are standard 2x4xOSB sheathing, flat-panel patterns, and they arrive as a package of walls to be fastened to a foundation or rim joist, and trusses to be placed on top. More or less plug and play. I believe most non-mobile prefab homes have gyproc installed post-construction, not the jointed fibreboard panels used in (older?) mobile homes.

A local homeless transitioning apartment block appeared to use a very modular design, a crane lifting frameworks into place. Now that I think of it, I wonder if those were the same units an Albertan motel chain had been using, that were being constructed locally and shipped off on a flatbed.

Most home construction is still done on-site, with framing being cut and nailed and clad per the blueprint, and various specialty crews coming through in sequence to housewrap, install siding, wire, plumb, insulate, sheetrock, trim, install windows and doors, lay flooring, roofing, etc. It is astoundingly quick when well-managed and there are no supply chain issues.

And then there are ATCO units. I believe the Alberta oilpatch lives in their modular systems.

Why don't they try to make this quality in California? There's certainly money for it.

The article is about homes built as essentially a giant camping trailer. The entire home (sometimes in two pieces, as a "double-wide") is delivered to the property and semi-permanently installed, but can still (theoretically) be moved somewhere else after that.

$36/sq ft? Where can you build for that?

Umm, it's $600 per square foot in Boulder, CO.

It can get regulary -25c at winter so insulation needs to be whole different ballpark than average California house.

They are less durable than a bronze one, and, when your toilet flange goes wrong, you have a major problem.

Personally, I like PVC for being light, easy to modify, and definitively waterproof.

His comment may have pointed out electrical outlets - which yes is negligible. But it's not the only thing totally out of control. I'm in CA so my requirements are nuts. My wife and I are building a home ourselves. Ever look into category D (earthquake zone) requirements for footer sizes? Look at the indoor sprinkler requirements? What about when you are on a well? Look at water heater requirements - solar requirements (which are fine for me since not connecting to PG&E anyway) If you ever write your own plans for a house, trust me, there are far more insane things you don't know about that exist that definitely raise the price of the house and certainly the complexity of building one.

I am probably looking at $2000 at least just for Simpson strong tie products.

If you have an actual foundation. Most MF homes in CA require the XI2 tie down system. Some of the manufactured home installers don't even pour a drop of concrete when they place your home. Most of the time it's gravel with some stamped concrete plates about 4" thick placed vertically as your "foundation".

> Under floor heating is for some reason literally illegal (unless you retrofit it) and I am still scratching my head as to why.

Mobile homes generally have little no insulation of any kind underneath, and their subfloors are exposed to exterior air, so the heat would be quickly lost to the outside environment.

You could in theory make a highly insulated subfloor on a mobile home (i.e. 2" of polyiso foam board) on which you could install electric or hydronic heating, but you would then lose a significant amount of already limited ceiling height.

I don't think this is accurate in the US. Yes, FHA loans require inspections, but they are WELL under half of all mortgages, and I am not aware of any other major lenders or loan programs that require inspections (there probably are some, but I have never encountered one in many home purchases and sales). Most do require appraisals, but an appraisal is very different than an inspection, and usually the buyer does not see the appraisal report (as the actual customer is the lender, not the buyer).

I've had home inspections done. It's a scam. The inspector finds one or two token things, and creates a fancy looking report.

That looks more sophisticated than what I’m talking about. This is more along the lines of what I’ve seen:

https://mobilehomepartsstore.com/parts/230215.html

These are “self-conainted” and don’t go into electric boxes. They’ll a hole gets cut in the drywall and the outlets have ears that push out to attach it to the wall. The wire goes through the back and then the back cover gets tightened and the pressure cuts into the wires to juice the outlets.

> I thought people stopped thinking like this after 2008/9

Why would they? It's not like it stopped in 2008. If you bought at the _peak_ in 2007 and held, in pretty much every area in the UK you're currently _way_ up, particularly if you leveraged yourself.

> When people buy a house and sell for more, they don't include property tax, mortgage interest costs, maintenance costs in their mental calc of profit. Sometimes they include renovations costs, sometimes not.

And people who make this argument often fail to consider the alternative costs, e.g.renting (which here in the UK is likely to be ~30% greater than the cost of mortgage interested to cover affordability checks), and leverage. You know what beats a 10% return on a 20k investment? A 100% return annually on a 20k investment.

For a £200k property in the UK, you could buy it in 2017 with a 20k downpayment, ~£1000 in fees, on a mortgage with 2% interest rates, and it would _very_ likely be worth £240+k right now even without any renevation work.

> They also don't factor in their next house they buy is inflated too.

You're assuming that people are selling to buy bigger houses, or that the rises are spread equally across all pricing bands. If you take my parents as an example, they bought a family home in late 80s/early 90s, sat on it for 30 years, and then downsized to a smaller home. The "inflation" of their house was far more than the inflation of the house they moved into. Also, the ceilings are loosely capped with earnings (since 2008 here at least) - stress tests for lending mean that in practice for the last few years, banks have been lending a maximum of 4.5-5.5x of borrowers income, so the cap is loosely set based on that.

Or equity release, but yes. Downsize/release equity for a sizable profit, and don't have to continue to pay market rents to continue living.

And those areas are harder to find unless you go waaaaay out there.

Even then you need to invest in septic tank generally.

Even if you could find a park for them, after about 20-30 years they can't really be transported because the materials/glue/calk/etc they are manufactured with literally cracks, breaks and even disintegrates.

AKA, moving one creates a lot of dynamic stress that breaks the roof seals, flooring, plumbing, etc. Leaving them sitting its possible to maintain them such that they remain waterproof, but as soon as you move it, they need a new roof coating at a minimum.

Its largely why they lose value too. They need to really be treated as prefab, placed on a foundation and built around. Only one ends up replacing much of the thing over the long run as mobile home parts aren't as generic as normal houses, so one gradually has to replace the lightweight fixtures/windows/etc with normal builder grade hardware which weights significantly more before the mobile home specific parts become unavailable.

Buying up the trailer park/land is becoming an increasingly predatory business model for investors, precisely because it is impractical/impossible and a poor economic decision to move manufactured housing or trailers.

It's not uncommon to buy a piece of rural land and drop a mobile on it. I've even seen folks do it so they have a place to live while they build a traditional house.

Yeah, I was going to comment the same thing. I’ve lived in multiple regions where there is plenty large, owner occupant lots where the structure is a mobile home. The mobile home park/ground rent model is definitely not the only model in use for these structures.

Around here (DC suburbs out to Appalachia), it’s a mix of both. The closer to the city, the more likely the mobile home is in a trailer park. Though there aren’t many left - most that I’m aware of have been bought/closed/redeveloped.

In terms of increasing the supple of affordable homes for people who are in suburban or semi-rural areas, mobile homes really are a mixed bag, for the reasons listed (which is then exacerbated by PE firms buying up parks and milking the residents dry).

There’s technically a market, but they experience insane amounts of depreciation. If they’re sold with land, most of the value is in the land.

This is true in a lot of areas of Texas. The mobile home dealer will even help you find land. You typically have to have a water well and septic system installed on the land.

I see these mobile home land packages come up for sale on Redfin all the time. They do appear to appreciate in value if they are clean and taken care of, but not as much as a site built home. I have even seen some successful flips.

I guess the main drawback is that they are typically located on less desirable land and the lifespan of the house just isn't going to compare favorably to a site built house, but at least they are affordable.

Thanks!

I took it to mean transporting the pre made houses by airship instead of over existing roads.

Less traveling public, more heavy transport.

By removing the “must ship by road” requirement, you could have many more shapes and sizes for the prefabricated home components. Transport of the components by airship would be one way to avoid roads.

(It brings a whole host of other issues too, so it’s not something I find all that practical, but I’m not the parent)

Airship to transport the house, not airship as a house

....I think they mean delivery and transport by airship, versus delivery by road.

I don't see how that would work, given mobile homes weigh roughly 50 pounds per square foot, and that probably doesn't account for personal belongings and furniture. Even very large cargo helicopters seem to top out around 20 tons.

A fair and amusing point. But we may finally be reaching the viability point of a return of airships (cf for example, last month’s https://news.ycombinator.com/item?id=31592448#31593040 ).

For large objects the road constraints are more significant so when the constraint space opens up new opportunities emerge. And a lot of housing is needed!

Simply said, a house with no or very limited heating system. But it is of course more complicated than that.

https://en.wikipedia.org/wiki/Passive_house#Space_heating_re...

As far as I can tell, it's a standard which just means that the building needs very little energy for heating or cooling. It mostly comes down to making the building very insulated (as far as I can tell--not saying that's the complete story, but that's a big factor).

https://en.wikipedia.org/wiki/Passive_house

Passive house atleast here means a house that generates more energy then it consumes. E.g very well insulated house with solar power, ventilation that gives back energy etc.

They are designed to reduce energy requirements (especially heating and cooling) by at least 75% to 90% compared to regular homes and ideally by 100% by capturing and holding heat in the winter and blocking heat in the summer. They tend to have thick walls, triple paned windows, and be air tight.

https://passipedia.org/basics/what_is_a_passive_house

Much easier. I assume the GP means something like SIPs, which are machined, insulated panels which fit together super tightly, with precise holes for windows etc. Typically, once the groundwork is done, they can be easily assembled in a few days. They then make then look like normal houses with a suitable external facade.

I wasn't aware of that!

In the US, tract builders target houses to be built from the ground up in 100 days, assuming supplies and workers are available.

If it was more economical to do prefab, DR Horton/Lennar/etc would be doing it.

If you watch the video, they explain that they are all designed to be moved if the owner wants to, just like a mobile home. They are in just mobile homes but with more attention paid to aesthetics.

This is accurate. Here's an example of multi vs single family construction stats: https://www150.statcan.gc.ca/n1/en/daily-quotidien/220509/dq...

From the values of each, you can tell that multi-family units are a larger portion of residential construction. How much larger would require more research as on a per unit basis, multi-family units are cheaper per family than a single-family unit.

Essentially, manufactured home in this case, even if they were 50% of single-family home construction, would be less than 25% of total family units constructed (single-family units + (singe units being construction in multi-family buildings).

It also apparently takes significantly longer than just building with cinder block.

So, yah its interesting, and the rounded corner things, along with the hollow walls are "neat" but much of the cost of single story homes isn't the first story walls is it? Its all the finish work/etc that still will need to be done.

So, its hard to see where any cost savings can come from if they are optimizing a part of the design that contributes a minority to the total cost.

Thank you, that is a really good critique of container homes.

My idea was to do a 2x2 stacking, breach the center walls and reenforce them with iron. No need for insulation if you live where the cimate is tolerable year round. No matter what there will be a lot of new iron welded, I didn't know iron was considerably expensive. I think mixing wood with iron is the cause for all this, if not pure iron then brick makes more sense for an insulation layer than wood+foam. You might say the container is useless then, but it really isn't, it provides the frame/beams that hold everything together. With traditional houses you have to use wood at some point which is what I dislike.

But overall, the cost of houses is the biggest motivation. Land+construction if it can be done under $100k then why be forever in debt over a $500k (if you are lucky) house.

I’m confused. So he’s not living in a $50,000 prefab made by boxabl on SpaceX property?

Steel seems a terrible material for a building shell because it conducts heat so well.

You can buy lightly used containers for like $6k so if it was modular housing you could put a few of them together cheaply.