Additional Manufactured Housing Could Benefit Millions of U.S. Homebuyers

At a time when the U.S. housing shortage has caused home prices to soar, removing the barriers that prevent more manufactured housing from being built is vital. Improving access to these modern mobile homes could give millions of people nationwide better access to a kind of unsubsidized and more affordable homeownership.

To better understand how much of a savings manufactured housing could provide to homebuyers, as well as to assess the current barriers to its broader use and opportunities to expand supply, The Pew Charitable Trusts funded three research papers produced by the Harvard Joint Center for Housing Studies (JCHS). The work, published in 2023 and 2024, also provides examples of how builders and developers are starting to use these homes to build new neighborhoods, fill in vacant lots, or install accessory dwelling units on single-family lots.

The center’s first analysis found that purchasing a new manufactured home could save a homebuyer $50,000 to more than $100,000 compared with a comparably sized site-built house. That is because, even considering that manufactured homes must be shipped and installed on a lot, they still cost 35% to 73% as much as construction of a traditional home, not including the land costs. However, the JCHS research shows that manufactured housing remains largely unavailable in 845 counties. That’s slightly more than a quarter of all counties nationwide, mainly in the Midwest, according to the portion of the work that examines the barriers and potential of manufactured housing.

The second study, published in January 2024, found that misperceptions about the safety, quality, and style of manufactured housing represent another key barrier that keeps it from being used more often. In reality, modern manufactured homes can have high-end finishes and pitched roofs that look very much like site-built single-family homes. They are often made to be very energy efficient as well, with some available as “net zero” homes that make all of their own energy. In September 2024, the U.S. Department of Housing and Urban Development made extensive updates to its building code for manufactured housing to allow for more modern and accessible designs.

Still, outdated impressions have resulted in zoning restrictions—especially in suburban or urban areas—that disallow manufactured homes in single-family neighborhoods. Most owners of these homes also own their land and can get a mortgage, but in locations where the homes are allowed only on rented land (as is common in metropolitan areas), homebuyers are often prevented from getting a mortgage and must turn to financing alternatives that frequently have higher interest rates and fewer consumer protections. In these situations, affordability is diminished, and borrowers are more vulnerable to loss of their homes.

That’s why updates to local zoning that allow manufactured homes to be used just like any other single-family unit are needed. Such changes would allow more lower-cost homes to quickly fill vacant lots, replace dilapidated housing, serve as accessory dwelling units, or create new subdivisions.

Reducing the zoning and permitting barriers could significantly expand access to attainable homes. Using data from the U.S. Census Bureau and American Community Survey estimates, the JCHS research found that policymakers in hundreds of counties nationwide have opportunities to expand access to manufactured homes and help 3.2 million moderate-income renters become homeowners. According to the studies, many of these individuals—who earn between $50,000 to $100,000 per year—might struggle to purchase a traditional, site-built single-family house but would likely be able to afford a new manufactured home if more were available.

In addition, JCHS noted that improving access to manufactured homes could have a significant impact in 23 large, low-cost urban counties examined, possibly benefiting 1.4 million households, nearly half of the renters in the analysis. Among those were the counties that include Detroit, Dallas, Houston, and St. Louis. However, the research shows that there may also be important opportunities in high-cost areas that now have few manufactured homes, such as in parts of the West and Northeast. For example, in parts of California, manufactured homes have been used as accessory dwellings on single-family properties. (See Figure 1.)

And state policymakers have begun to act, hoping to help expand the availability of affordable options. In 2024 alone, Maryland, Maine, New Hampshire, and Rhode Island enacted legislation to prevent zoning barriers for manufactured homes so that they can be constructed and used wherever single-family homes are allowable.

As part of the JCHS work, researchers also conducted five case studies to examine how different organizations have been using manufactured homes to help expand housing supply. The case studies describe initiatives by private companies, nonprofit organizations, and the city of Jackson, Mississippi, each of which promoted manufactured homes as a lower-cost way to build housing to serve local populations.

Key factors for the success of these projects included initiatives to educate the public about the current quality of manufactured homes (often highlighting the features of high-end models called CrossMods that come with attached porches and garages), updating zoning laws, or choosing to install the homes in areas where they are allowed as individual units or accessory dwellings. Some of the entities also worked to ensure that buyers would own both the home and the land as real estate as with most single-family homes, so they could secure mortgage financing. In the case of Jackson, for example, the city has been helping buyers with down payments.

Ultimately, the collaboration and cooperation among town officials, appraisers, financial institutions, or other nonprofits proved critical to the initiatives’ success because many of these efforts were first-of-their-kind developments or demonstration projects.

Endnotes

1. Chris Herbert et al., “A Review of Barriers to Greater Use of Manufactured Housing for Entry-Level Homeownership,” Joint Center for Housing Studies of Harvard University, 2024, https://www.jchs.harvard.edu/sites/default/files/research/files/harvard_jchs_barriers_manufactured_housing_2024.pdf.

Rachel Siegel is a senior officer and Kery Murakami is a principal associate with The Pew Charitable Trusts’ housing policy initiative.