MANUFACTURED HOME NEWS AND VIEWS: 2016, Manufactured Home Ownership and The Feds?
Will 2016 be the year the federal government embraces the most affordable option for family housing?
Yogi Berra once famously said, “It’s hard to make predictions, especially about the future.”
The late great catcher wasn’t a political pundit, but his aphorism is absolutely true for those of us trying to predict actions by our elected officials as they try to address America’s affordable housing crisis.
MANUFACTURED HOME NEWS AND VIEWS: 2016, Manufactured Home Ownership and The Feds?
Most officials and bureaucrats are addressing the crisis by encouraging and subsidizing rental projects across the country to house middle to lower income families. While that’s certainly a noble undertaking, for many Americans “affordable housing” pales in comparison to the uniquely American dream of “affordable home ownership.”
For lower income families that want to own a home, manufactured housing represents the single most affordable option, particularly for families in rural areas. According to the Manufactured Housing Institute the average price of a new manufactured home is $64,000—compared to a medium site built home price of $296,900.
MANUFACTURED HOME NEWS AND VIEWS: 2016, Manufactured Home Ownership and The Feds?
Today’s new manufactured home is built equally as well and often superior to a comparably sized and sited site built home with a total cost up to 50% less, with land included.
The only advantage a site built has over a manufactured home is the disparity in financing availability. Manufactured homes do not qualify for government sponsored financing for qualified American families seeking quality affordable home ownership.
We agree with the Manufactured Housing Institute (MHI), that housing policy should be opening doors and facilitating credit for families priced out of the site built and rental markets. The demand is there. MHI believes this can be accomplished while fully protecting consumer rights.
Seven years ago, Congress identified manufactured housing as one of three underserved markets that the government sponsored-enterprises, Fannie Mae and Freddie Mac, “should have a duty to serve.”
Fannie Mae and Freddie Mac
During the ensuing seven years little was done to equalize the mortgage disparity between site built and manufactured homes. Only recently have there been any indication that the “duty to serve’’ admonition would ever be implemented.
FHFA, the Federal Housing Financing Agency, an independent regulator responsible for the oversight of vital components of government-sponsored secondary mortgage market enterprises, Fannie Mae and Freddie Mac issued a news release on 12-15-16 that could significantly reform the manufactured home market. A study will be conducted to put manufactured home financing on par with real estate mortgage financing utilizing the U.S. sponsored secondary mortgage market enterprises.
The FHFA study is expected to address various aspects of manufactured home financing, including land lease communities, homes on private land financed as chattel loans, and a willingness to experiment with financing manufactured homes that are not secured by real estate.
It would be difficult to predict the time frame or the eventual outcome of the study that has been a long time coming, confirming another Yogism, “It ain’t over til it’s over.”
For more information, access our blog posted on 12-28-15, “FHFA PLAN COULD SIGNIFICANTLY CHANGE HOW MANUFACTURED HOMES ARE SOLD, SITED AND FINANCED”
(For those looking for greater detail on their local manufactured housing lenders, communities, dealers, and/or the many different floor plans currently available, click the prior link.)
