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Manufactured Housing Questions
[ I'm not sure if this is the best group
to post this in. If you know of a better group let me know. ] Hello, I am considering a manufactured home because they offer a very attractive price point. However, based on what I've read on various message boards I am having serious doubts as to the viability of these homes. To make matters more difficult there are no less than three key players in the process each of which seem to have a history of probelms: 1) Manufacture 2) Dealer 3) Setup and Installer It seems that any or all of these player can ruin your home buying experience. My question is basically this. Based on the horror stories I've seen here and elsewhere is there any real point in considering a manufactured home? Are there people out there who have had good luck with their manufactured home? How can one make sure they get a good deal and their home is delivered and installed properly? Also, are the rates of dissatisfaction of manufactured home owners significantly higer than "traditional" home owners? They also have their fair share of problems. I really like the cost savings of a manufactured home but I don't even want to get involved if it's something that I'll regret the rest of my life. (I'm going to put down a sizeable amount of cash for the down payment -- at least it's sizeable to me :). I look forward to your comments. Kent |
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The reasons for buying a house, if you ask me, are to have pretty much
fixed monthly payments from then on (slight yearly increases in taxes/insurance though), and to have your own home and property to do with what you want. If you want to repair your car in your driveway, that is your business. If you want to water your lawn or have a swimming pool for the kids, that is your business. If you buy a manufactured home and place it in a manufactured home park and pay rent for the space... Then it is basically the same as renting in that the park manager can tell you what you can and can't do. Also space rent will go up. Then if you want to move, you are stuck. It would cost quite a bit to move the manufactured home. And you would probably have difficulty selling it. I have seen entire parks with for sale signs on every manufactured home and no buyers. The people had been trying to sell for years. So if planning to buy a manufactured home and rent the space/land it sits on, might as well just rent a house or apartment. Then it would be easier to move if you were not happy for one reason or another. Also repairing things and installing new things in a manufactured home can be a real pain. You may not be able to go out and buy just any new furnace for example. You may be stuck with only furnaces approved for manufactured homes. Same thing with wood stoves. They need to be manufactured home approved. And various plumbing parts may not be available locally. I know a plumber who tried getting some special hose clamps used in manufactured home water "pipe" plumbing. They were only available from the home manufacturer. The manufacturer would not sell them to the plumber. Then the only way the manufactured home owner could get their plumbing repaired was to have the service department of the home manufacturer come out and fix it for an exorbitant rate. Need a new door? Maybe the doors are special sizes. May not be able buy one just anywhere... |
Thanks for the replies...
I guess I failed to mention that I would be putting it on private land and on a permanent foundation. |
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On Wed, 24 Aug 2005 21:32:40 -0600, in misc.consumers.house "Clark W. Griswold,
Jr." wrote: wrote: I guess I failed to mention that I would be putting it on private land Assuming the land is yours or you have made other arrangements, that avoids the rent issue. and on a permanent foundation. Ummm, I assume you mean a concrete slab with cinderblock skirting? In any case, unlike traditional housing, a trailer will do nothing but depreciate. You would be far better off financially by using your financial resources towards a smaller starter home. Especially with all the downpayment and other assistance programs available. The decision is obviously yours, but you need to go into it with the facts. Manufactured homes on acreage appreciate in value. But after living in one for ten years and having the kitchen cupboards fall apart and having to go to an RV store to get plumbing parts and having rats tunnel under the skirting and nesting in the underhouse insulation I'd rather be in a stick built home. I'm in a stick built home now and the kitchen cupboards are 34 years old and in much better shape then the 10 year old ones in my mobile. |
wrote in message ... On Wed, 24 Aug 2005 21:32:40 -0600, in misc.consumers.house "Clark W. Griswold, Jr." wrote: wrote: I guess I failed to mention that I would be putting it on private land Assuming the land is yours or you have made other arrangements, that avoids the rent issue. and on a permanent foundation. Ummm, I assume you mean a concrete slab with cinderblock skirting? In any case, unlike traditional housing, a trailer will do nothing but depreciate. You would be far better off financially by using your financial resources towards a smaller starter home. Especially with all the downpayment and other assistance programs available. The decision is obviously yours, but you need to go into it with the facts. Manufactured homes on acreage appreciate in value. But after living in one for snip I too have only heard that mobile homes depreciate in value. My grandparents had one.. theirs never did appreciate. Makes sense too.. I mean, if you have to buy a mobile home.. who would buy a used one? Buy a regular home, IMO. |
On Thu, 25 Aug 2005 11:52:46 GMT, in misc.consumers.house "Lucy"
wrote: Manufactured homes on acreage appreciate in value. But after living in one for snip I too have only heard that mobile homes depreciate in value. My grandparents had one.. theirs never did appreciate. Makes sense too.. I mean, if you have to buy a mobile home.. who would buy a used one? Buy a regular home, IMO. Mine appreciated in value.. it's not just something that "I heard". |
In article ,
"Lucy" wrote: I too have only heard that mobile homes depreciate in value. My grandparents had one.. theirs never did appreciate. Makes sense too.. I mean, if you have to buy a mobile home.. who would buy a used one? Buy a regular home, IMO. Why spend 10 to 20 times the money to get a "regular" house when a manufactured home keeps you just as dry and comfortable? And lets do some math. Lets say I buy a luxurious top of the line mobile home for $30,000. And I live in in 30 years. Lets say it has zero value and the end of the 30 years (according to your scenario). So, by living there, it has cost me about $1000 per year, and I have no investment. Compare that to a regular house in the city that costs $300,000. To live in this house, you have to pay $1800 a month, plus a few thousand a year in taxes and insurance. You end up paying hundreds of thousands of dollars in interest. In fact, you pay almost twice per month of what the other house costs per year to live in. In fact, if you put that $1800 per month into a regular house, you end up with a 30 year old regular house worth maybe $300K that needs 30 years of maintenance and updating. On the other hand, if you bought the mobile home, you have a livable house worth nothing, but if you invested that $1800 a month wisely at 6%, you end up with a nest egg worth nearly $2,000,000. So, to avoid losing $30,000 in value on a manufactured home, you foolishly suggest a "regular" house, when in fact, the decision to buy that regular house cost you over a million and a half dollars in missed profits. Making that kind of mistake should be a criminal offense. -john- -- ================================================== ==================== John A. Weeks III 952-432-2708 Newave Communications http://www.johnweeks.com ================================================== ==================== |
"John A. Weeks III" writes:
In fact, if you put that $1800 per month into a regular house, you end up with a 30 year old regular house worth maybe $300K that needs 30 years of maintenance and updating. You are assuming 0% RE appreciation rate over 30 years. That's a pretty bad assumption given recent history. On the other hand, if you bought the mobile home, you have a livable house worth nothing, but if you invested that $1800 a month wisely at 6%, you end up with a nest egg worth nearly $2,000,000. If OTOH we assume 10% RE appreciation rate over that same 30 years, I end up with a much bigger nest egg: $300K * (1.1 ** 30) = $5.2M I can now sell that house, buy a new manufactured house for $300,000 (which is will probably cost then), and lugh at your puny $2M nest egg. So, to avoid losing $30,000 in value on a manufactured home, you foolishly suggest a "regular" house, when in fact, the decision to buy that regular house cost you over a million and a half dollars in missed profits. Making that kind of mistake should be a criminal offense. If you could reliably predict appreciation rate of stocks/bonds/RE, you could become billionaire no matter what. If you can't, you may come out ahead, or behind the guy who buys "real house", but I don't think you should go to jail either way :) Cheers, -- In order to understand recursion you must first understand recursion. Remove /-nsp/ for email. |
"John A. Weeks III" wrote:
And lets do some math. Lets say I buy a luxurious top of the line mobile home for $30,000. And I live in in 30 years. Lets say it has zero value and the end of the 30 years (according to your scenario). So, by living there, it has cost me about $1000 per year, and I have no investment. Compare that to a regular house in the city that costs $300,000. To live in this house, you have to pay $1800 a month, plus a few thousand a year in taxes and insurance. You end up paying hundreds of thousands of dollars in interest. In fact, you pay almost twice per month of what the other house costs per year to live in. In fact, if you put that $1800 per month into a regular house, you end up with a 30 year old regular house worth maybe $300K that needs 30 years of maintenance and updating. On the other hand, if you bought the mobile home, you have a livable house worth nothing, but if you invested that $1800 a month wisely at 6%, you end up with a nest egg worth nearly $2,000,000. So, to avoid losing $30,000 in value on a manufactured home, you foolishly suggest a "regular" house, when in fact, the decision to buy that regular house cost you over a million and a half dollars in missed profits. Making that kind of mistake should be a criminal offense. Missed profits? What passes for financial education in this country is the criminal offense. To compare your two scenarios on an equal basis, you have to assume that both transactions are cash deals. Traditional housing in the US has historically appreciated at a minimum 5% annual rate over the long term. Current market aside, its reasonable to assume that will continue. We'll also assume that $30K includes land, or rent free use thereof, which is unlikely. I agree, that $30K trailer will be worth nothing at the end of 30 years. The 300K house OTOH, will likely be worth at least $1.3 million at the same 30 year point - not "maybe $300K.". Even subtracting the difference in maintenance and taxes, there is no comparison. Your math above makes no sense. You seem to be saying that you can live in a trailer for free and invest a $1800 mortgage payment elsewhere, resulting in an end result of $2M. That doesn't work. Let's move on to a financed deal. Last time I looked, mortgages on trailers carry higher interest rates than standard mortgages, and the term is significantly shorter. That means someone financing a trailer will end up with an out of pocket amount each month not much more than a standard mortgage. Furthermore, many states offer special underwriting programs for first time home buyers that reduce the currently low rates even further. Quality of life? Sound insulation? Thermal insulation? There's no comparison. Look - I don't sell houses or trailers, but I can do basic math. I'd like to see one competent financial authority that suggests that as a rule trailers are better financial deals than traditional houses. There are lots of people living in "manufactured homes" these days, for lots of valid reasons. Appreciation and investing any difference in the market aren't likely to be those reasons. |
In article ,
John A. Weeks III wrote: Why spend 10 to 20 times the money to get a "regular" house when a manufactured home keeps you just as dry and comfortable? And lets do some math. Lets say I buy a luxurious top of the line mobile home for $30,000. And I live in in 30 years. Lets say it has zero value and the end of the 30 years (according to your scenario). So, by living there, it has cost me about $1000 per year, and I have no investment. Compare that to a regular house in the city that costs $300,000. To live in this house, you have to pay $1800 a month, plus a few thousand a year in taxes and insurance. You end up paying hundreds of thousands of dollars in interest. In fact, you pay almost twice per month of what the other house costs per year to live in. That $300K house also includes the land, which you are going to need even if you own a manufactured home. I'd look at it in terms of how much it would cost to build a traditional home versus how much it costs to buy a mobile home. I suspect that the mobile home will be cheaper, but not to the extent that you've outlined. Dimitri |
In article ,
Paul Pluzhnikov wrote: "John A. Weeks III" writes: In fact, if you put that $1800 per month into a regular house, you end up with a 30 year old regular house worth maybe $300K that needs 30 years of maintenance and updating. You are assuming 0% RE appreciation rate over 30 years. That's a pretty bad assumption given recent history. You are right, bad assumption. A bunch of undesirables could move into your neighborhood and depress the housing values. Or you could lose your job and be forced to sell after the bubble bursts, and you lose your butt on the deal. Or you picked a city like Flint, Michigan, and all the plants in town close down, and you cannot sell the house no matter how cheap you offer it, and it ends up on E-bay unable to get a minimum bid of $1500. -john- -- ================================================== ==================== John A. Weeks III 952-432-2708 Newave Communications http://www.johnweeks.com ================================================== ==================== |
"Clark W. Griswold, Jr." wrote in message ... "John A. Weeks III" wrote: And lets do some math. Lets say I buy a luxurious top of the line mobile home for $30,000. And I live in in 30 years. Lets say it has zero value and the end of the 30 years (according to your scenario). So, by living there, it has cost me about $1000 per year, and I have no investment. Compare that to a regular house in the city that costs $300,000. To live in this house, you have to pay $1800 a month, plus a few thousand a year in taxes and insurance. You end up paying hundreds of thousands of dollars in interest. In fact, you pay almost twice per month of what the other house costs per year to live in. In fact, if you put that $1800 per month into a regular house, you end up with a 30 year old regular house worth maybe $300K that needs 30 years of maintenance and updating. On the other hand, if you bought the mobile home, you have a livable house worth nothing, but if you invested that $1800 a month wisely at 6%, you end up with a nest egg worth nearly $2,000,000. So, to avoid losing $30,000 in value on a manufactured home, you foolishly suggest a "regular" house, when in fact, the decision to buy that regular house cost you over a million and a half dollars in missed profits. Making that kind of mistake should be a criminal offense. Missed profits? What passes for financial education in this country is the criminal offense. To compare your two scenarios on an equal basis, you have to assume that both transactions are cash deals. Traditional housing in the US has historically appreciated at a minimum 5% annual rate over the long term. Current market aside, its reasonable to assume that will continue. We'll also assume that $30K includes land, or rent free use thereof, which is unlikely. I agree, that $30K trailer will be worth nothing at the end of 30 years. The 300K house OTOH, will likely be worth at least $1.3 million at the same 30 year point - not "maybe $300K.". Even subtracting the difference in maintenance and taxes, there is no comparison. Your math above makes no sense. You seem to be saying that you can live in a trailer for free and invest a $1800 mortgage payment elsewhere, resulting in an end result of $2M. That doesn't work. Let's move on to a financed deal. Last time I looked, mortgages on trailers carry higher interest rates than standard mortgages, and the term is significantly shorter. That means someone financing a trailer will end up with an out of pocket amount each month not much more than a standard mortgage. Furthermore, many states offer special underwriting programs for first time home buyers that reduce the currently low rates even further. Quality of life? Sound insulation? Thermal insulation? There's no comparison. Look - I don't sell houses or trailers, but I can do basic math. I'd like to see one competent financial authority that suggests that as a rule trailers are better financial deals than traditional houses. There are lots of people living in "manufactured homes" these days, for lots of valid reasons. Appreciation and investing any difference in the market aren't likely to be those reasons. There was a lot of faulty logic at work. No taxes were assessed on the mobile home's land, and comparing a mobile home to a 300k house was nuts, instead of one a little less expensive than a house. In addition to him not mentioning taxes on land, he also assumed someone living in a mobile home does so by choice, instead of due to financial circumstances. I feel safe in saying most people living in trailers dont have an extra 1800. per month lying around to invest, much less likely is finding 6% (outside of stocks). But such is the nature of newsgroups.. there is always at least one person who defies logic. lucy :) |
In article , spamtrap100
@comcast.net says... wrote: and on a permanent foundation. Ummm, I assume you mean a concrete slab with cinderblock skirting? Manufactured houses can be installed on real foundations, not just slabs and cinderblock. The better-quality modern units are a huge step above manufactured homes of a few decades ago -- installed well, to the casual observer they're almost indistinguishable from site- built homes. They meet building, seismic, and energy codes, use standard plumbing and wiring fixtures, etc. And I've seen enough of them on the market to know that they definitely can appreciate if installed properly and maintained well. One thing opponents of manufactured housing never seem to mention is that the primary driver of appreciation isn't the building itself, but location, location, location. Does the neighborhood feel like a trailer park, or is the house in a neighborhood of $500,000 homes? -- is Joshua Putnam http://www.phred.org/~josh/ Updated Bicycle Touring Books List: http://www.phred.org/~josh/bike/tourbooks.html |
In article , spamtrap100
@comcast.net says... Let's move on to a financed deal. Last time I looked, mortgages on trailers carry higher interest rates than standard mortgages, and the term is significantly shorter. That means someone financing a trailer will end up with an out of pocket amount each month not much more than a standard mortgage. I don't sell homes, site-built or manufactured, but I insure both, and buyers definitely can get 25- and 30-year, 5%-down mortgages on manufactured homes. When I've discussed it with clients, the lower cost of the house more than offsets the slightly higher rate. The last one I remember was just over 7% for a $60,000 double-wide on a half-acre with a view. Now, to be clear, this applies to modern manufactured homes, built to modern codes, on permanent foundations, on owned land. If you want to buy a single-wide and keep the axles on, you'll still be stuck with a personal-property loan instead of a mortgage. Quality of life? Sound insulation? Thermal insulation? There's no comparison. Thermal insulation is comparable to site-built homes under current energy code for approved manufactured homes. Sound insulation is good in better-quality models, 2x6 framing for exterior walls, 2x4 interior walls with drywall, pretty close to stick-built standards. -- is Joshua Putnam http://www.phred.org/~josh/ Updated Bicycle Touring Books List: http://www.phred.org/~josh/bike/tourbooks.html |
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In article v5BPe.1024$mH.926@fed1read07,
mers (The Enigmatic One) wrote: In article , says... You are right, bad assumption. A bunch of undesirables could move into your neighborhood and depress the housing values. Or you could lose your job and be forced to sell after the bubble bursts, and you lose your butt on the deal. Or you picked a city like Flint, Michigan, and all the plants in town close down, and you cannot sell the house no matter how cheap you offer it, and it ends up on E-bay unable to get a minimum bid of $1500. This has *GOT* to be a troll. How so? The real estate people today are sounding just like the stock market people back in 1999. I clearly remember them saying it was a new economy, stocks can only go up, and Worldcom is a bargain at 125. Just like most investors lost their a** in the stock market in 2000, most real estate speculators are going to lose their a** very soon, and many common poeple are going to get hurt when the bubble breaks. I would advocate that a person who pays cash for a reasonable manufactured home is going to be far better off in the long run than a person who takes out a no money down variable rate loan on a $300K starter home (which is where the market is at where I live). -john- -- ================================================== ==================== John A. Weeks III 952-432-2708 Newave Communications http://www.johnweeks.com ================================================== ==================== |
I had a Wasau home back in the late 80's. It was the most comfortable
house I've ever lived in. I would still be there if it weren't for job changes. The interior was drywalled and looked just like a stick built home, non of that old crappy paneling with vaulted ceilings that was so prevelant in the 70's. The quality of materials far exceeded what was being put in local stick built homes. I wouldn't hesitate to evaluate this option again. As for deals and cost savings -- you have to put the numbers together and compare. You have to do the homework to contact current customers of the home you decide on...CHECK references from the dealer you choose to go with. YMMV -- but my experience was a positive one. Best of luck... Darwin |
John A. Weeks III wrote: How so? The real estate people today are sounding just like the stock market people back in 1999. I clearly remember them saying it was a new economy, stocks can only go up, and Worldcom is a bargain at 125. Just like most investors lost their a** in the stock market in 2000, most real estate speculators are going to lose their a** very soon, and many common poeple are going to get hurt when the bubble breaks. Ah but there's a breed of investors that are quietly buying at rock bottom prices and literally can't lose. All those over priced (50-100K) manufactured homes out there are getting repo'ed left and right. The few lenders that loan on manufactuered homes (greentree, vanderbilt, etc) have to get them moved...and moved at low prices. 10-15% of retail price for homes under 10 years old is very common. Don't bother going to dealers seeking repo's as they charge inflated prices. If you're prepared to pay cash the rent on these places alone can pay them off in 2-4 years. The more of a fix-er-up model you buy the better the ROI. Go direct to the lenders and speak to their remarketing (repo) dept. They have lists of available homes in your area. Spend some time reviewing the available homes and don't be afraid to bid way below their "asking" price. You'll spend more on the land under the home than you will for the home itself. As for all the people who smirk about 5-10% annual appreciation on those high priced homes. I'll buy the cheap repo's and rent'em out with 25-50% annual ROI's. Plow the money back into more repo homes and wait for the coming real estate crash to really swell the repo market. |
"DAC" wrote:
I had a Wasau home back in the late 80's. It was the most comfortable house I've ever lived in. I would still be there if it weren't for job changes. Wasua homes are very high quality factory built homes. Walls and other major structures get built in the factory, using standard wood, etc., and get trucked to the site where they get installed on a standard foundation. WHen completed, you would have a difficult time identifiering any differences from a traditional home. In some cases, they are even stronger as they must stand being trucked to the site. They should not be confused with a trailer, euphemistically called a "manufactured home" by the manufacturers. |
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