Manufactured Home Purchasing Tip: New Home and Placement Site Should be Compatible and Simultaneous
“Putting the cart before the horse” is occasionally applicable to purchasers of new manufactured homes. Certainly understandable for many who fall in love with today’s new modern manufactured housing and enter into a purchase agreement before knowing where that home will be installed.
Where the home is to be sited is an important consideration that should be addressed simultaneously with the purchase. However, it is quite common that the home is determined before acquiring land to assure land and home compatibility.
Your purchase of the new manufactured home should be contingent upon locating a homesite in a geographical area acceptable to you. Most professional retailers will assist in your locating that special site. The site you choose and the type of installation will determine your total financial consideration and the type of loans available.
In the U.S., 65 percent of manufactured housing residents who own their home also owns the land that it is sited own, more often than not in rural areas.
Historically, 25-30 percent of manufactured homes have been placed within manufactured home land-lease communities.
We will first address the private property option first and the community option afterward. We have provided reference links to other ManufacturedHome, com blog reports that will give you more in-depth information on what you can expect with each of these manufactured home placement options.
LOCATING MANUFACTURED HOME ON PRIVATE PROPERTY AND INSTALLATION OPTIONS
Not all land is the same. In fact, some lots and acreage have specific building codes that may limit manufactured home placements or condition the type of installation.
The most common manufactured home installation in rural areas is setting up the home utilizing a support bloc or pier method. This is the least expensive set-up system and is normally included in the price of the home you have selected.
Financing of a manufactured home not attached to real property, aka “home only” chattel loan, is more costly as the loan is not secured by real estate. However, the costs of preparing the site are less expensive, and move in time is shortened. In fact, two-thirds of manufactured homes financed on property owned by the manufactured home purchasers opt for “home only” financing, not encumbering the land.
In some areas, usually close by metropolitan areas, the local housing authorities may require the manufactured home to be installed utilizing a foundation system, whereby the home is attached to real estate.
With this method of installation, the home becomes an affixture to real property. Lower cost “land home” financing is available with the land as additional security for the lender, however, the cost of site preparation and foundation system is more expensive and the move in time is delayed.
Check our report “Finding Land For Your Manufactured Home: Pitfalls To Watch Out For,” for more information.
We also suggest you visit our blog, titled “Manufactured Homes: Anticipating Utility Service Requirements On Your Private Property”
LOCATING HOME IN A LAND-LEASE COMMUNITY (MANUFACTURED HOME PARK)
If you intend to locate in a land-lease manufactured home community, one of the first things you want to do is contact the management office and check on the availability of sites for your new manufactured home.
The community can inform you about what size home will fit on the sites available and may also have some aesthetic requirements for homes in the community, such as exterior accessories, roof pitch, roofing materials, siding, etc.
Before signing a rental agreement you should obtain written copies of the community’s rules and requirements, age restrictions, policy regarding pets, parking, rent increases, trash service, utilities, restrictions on the use of facilities, etc.
Installation and financing of your manufactured home in a rental community will be the “home only” chattel loan method. Unlike a private property location, there will be little or no expense for site preparation.
Check out our report, “Land-Lease Manufactured Home Communities: What To Expect” for more information.
Question: So which comes first, the manufactured home or the placement site? – Answer: Both
