Manufactured Home HUD Code Updates a Final Rule Allowing More Than One Unit Per Structure
HUD’s recent update to the manufacture home building code makes several critical regulatory updates, aligning with NIskanen’s recommendation to increase the cap for multi-unit manufactured homes from three to four units. This update is significant for two reasons. First, allowing more than one unit per structure expands the use for cases for efficient factory-built construction methods, helping to narrow the construction cost gap between single family and small multi-family construction.
Second, by distributing land costs across more units, HUD construction becomes viable in more places with higher land costs. Additionally, increasing the cap from three to four units enables a double-section manufactured structure to accommodate two units in each section, which can be confined to create four units on a single property. By setting the cap at an even number, HUD facilitates a natural division of units within a traditional two section manufactured home layout.
HUD has also simplified several regulatory requirements. Special permission or “alternative construction” letters are no longer necessary for multi-unit buildings or for common design practices. Under the previous rules, many design features that have become industry standards required special permission from HUD through a process called an alternate construction letter. These features include ridge roof designs, updated material reference standards, accessibility improvements for showers, modern energy-efficient appliances, and other process efficiencies.
The agency has also issued a blanket alternative construction letter covering practices included in the final rule, making them effective immediately rather than waiting the typical six-month period following their publication in the Federal Register on September 16, 2024. This is expected to save manufacturers hundreds of thousands of dollars annually in reduced administrative and compliance costs, with total net benefits from all rule changes estimated at up to $334 million annually.
