Manufactured homes no longer have to sit on a steel chassis, and that could change what factory-built housing looks like from the street. The 21st Century ROAD to Housing Act removes the long-standing rule that manufactured homes be built on a permanent chassis for towing, and it requires chassis-free homes to get the same treatment for financing, titling, insurance, taxes, transport and installation. A Realtor.com report released Oct. 26 says the change could cut material costs and make these homes look a lot more like site-built ones. Whether they get built is a zoning question.
What dropping the chassis changes for manufactured home builders
The chassis was steel that stayed under the house for good, mostly so the house could be towed once. Taking it out lowers material costs, allows more flexible installation, including multi-level assembly, and gets rid of the raised step-up look that marks a house as a mobile home, the report says.
That matters to the site crews who set these homes, too. When the buyer owns or is buying the land, Realtor.com notes, foundation work and utility connections can generally be rolled into the loan, and Fannie Mae allows down payments as low as 3%.
Manufactured housing zoning is the real limit
Only about 17% of zoned land nationwide expressly allows mobile or manufactured housing parks, according to Land Use Labs data cited in the report, which covers about two-thirds of jurisdictions. Towns keep these homes out by leaving them out of residential zones, pushing them into commercial, industrial or agricultural districts, requiring parks or making installation a conditional use. Minimum floor-area and design rules can block homes that meet federal HUD standards.
The examples are specific. Albany, N.Y., bars mobile homes, mobile-home courts and trailer parks for dwelling purposes citywide. Aurora, Fountain and Monument, Colo., require a 24-by-36-foot minimum footprint that likely excludes many single-wides. Colorado Springs; Bethlehem and Upper Macungie, Pa.; and Spokane and Spokane Valley, Wash., already allow manufactured homes by right.
Realtor.com ranked Hartford-West Hartford, Conn., first for potential uptake, followed by Denver, Allentown-Bethlehem, Albuquerque and Colorado Springs. All of its top 10 are in the Northeast or West, and most are smaller markets where land is cheaper, new construction carries a premium and starter homes are scarce.
The payment gap is the pitch
The report’s math: a $200,000 manufactured home with 3% down at 7.4% means $6,000 down and an estimated $1,343 a month. The median site-built buyer put $27,100 down on a $419,250 home, for about $2,715 a month at the same rate. That’s a $1,372 monthly difference. “The federal change can only open the door,” said Realtor.com chief economist Danielle Hale.
Factory-built housing has been getting attention from builders and financiers alike, from Model/Z’s tax-credit-backed module plant to Exchange’s look at manufactured home wind tests, which found state anchoring rules that miss the federal minimum. The chassis change fixes a cost problem. It doesn’t touch the zoning map, and on 83% of zoned land the answer still isn’t an express yes.