Big Developments in Manufactured Housing Reform Bill

Source: excerpts from newsletter NISKANEN…Manufactured homes currently provide 8.4 million affordable, unsubsidized homes across the United States, with an additional 100,000 new units entering the housing market each year. Unlike the mobile homes of the past, today’s manufactured homes, built to HUD Code standards, undergo rigorous quality control and must pass independent inspections before they leave the factory.

These homes achieve their cost advantage over traditional site-built homes by being constructed in a factory setting, where a consistent workforce operates more efficiently compared to a job site with subcontractors frequently coming and going. According to the Harvard Joint Center for Housing Studies, excluding land costs, a manufactured home can be 27% to 65% less expensive than a comparable site-built home.

Since our last publication, two key reforms have moved forward; one legislative and the other administrative. The first is a legislative move by Senate Banking Committee Ranking Member Tim Scott (R-SC),who introduced the ROAD to Housing bill. The bill aims to eliminate the “steel chassis” mandate, a crucial aspect of HUD Code reform that cannot be fixed by rule making alone. The bill proposes a state-by-state voluntary opt-in for an off-chassis manufactured home option. By removing the permanent chassis requirement, the bill would reduce the costs of each HUD Code home by $5,000 to $10,000 and enable more flexible floor plans.

Second, HUD released a much-anticipated final rule updating its national building code for factory-built manufactured homes. The new rule permits up to four homes per structure. Introduces new multi-story designs, and allows for the use of improved materials and layouts-overall reducing red tape for popular existing designs. These changes aim to make HUD Code units more competitive in suburban and urban markets with higher land costs, marking the first significant shift since the HUD Code was adopted.

Chassis reform on the ROAD to Housing Act

Earlier this month, Ranking Member Scott introduced the Road to Housing Act, which includes several housing policy reforms. A key provision of the bill is the removal of the permanent chassis (or frame) requirement for HUD Code manufactured homes. Since the presence of a permanent chassis is part of the definition. Congress established for manufactured homes in 1074, only Congress-not HUD- can amend the definition.