Mobile homes are rising in value. But current residents can't cash out
Updated October 27, 2022 at 3:53 PM ET
Mobile home values are rising at a rate nearly as fast as that of single-family homes, according to a study released earlier this month by online loan platform LendingTree.
Across the country, the median values of mobile homes increased 34.6% on average between 2016 and 2021, compared to 35.4% for single-family homes, based on a LendingTree analysis of U.S. Census data.
But climbing values are where the similarities stop.
Residents of mobile homes say that unlike single-family homes, typically houses that buyers purchase as an investment as much as a residence, mobile homes become more burdensome with time. They can fall into disrepair, making them less attractive to potential buyers. And the private companies who own the land can lowball on price when offering to buy the homes.
Plus, for many mobile homeowners, choosing to sell right now would mean entering an even tighter housing and rental market.
So, even as the values of their homes rise, owners are finding they're stuck.
Getting less for more
As NPR previously reported, large companies have been buying out mobile home parks. They're raising the rent for the land the mobile homes sit on, increasing prices for typically low-income and elderly residents who say they aren't getting anything new.
"There's no repairs, there's no improvement in the warranty of habitability," said Yvonne Maldonado, a community organizer with grassroots group Manufactured Housing Action, referring to a requirement in all leases that owners ensure their properties are livable.
Landlords in most states are held to an implied "warranty of habitability" which requires owners to ensure that their properties are livable. But Maldonado, who is also a resident of a mobile home community in upstate New York, said big private companies often "do a lousy job" of providing services like trash and snow removal.
And inflation has been an added headache.
"It's hurting everyone," said Maldonado.
For Holly Hook, a resident at Swartz Creek Estates in Michigan, considered selling her home when a new company bought out the mobile park in 2018. But Hook soon realized that moving wouldn't be worth it.
She'd purchased her home, used, for $28,000, and the new company offered her less than $10,000.
"It gets harder and harder to sell, and you actually lose value in a lot of cases," said Hook.
Hook said she now lives with two roommates, and they split the monthly rent for the land the home sits on. She said some of her neighbors, many of whom are senior citizens living on fixed social security payments, have had to cut back on food and medicine.
"The community used to be really laid back, and people didn't worry about paying the rent because it was quite steady for years and years," said Hook. "All that relaxation and that feeling of security is just gone."
But fearing retaliation from the company that owns the land they live on, hardly anyone in her community is willing to speak up, she said.
"A lot of people feel powerless," she added.
The average sales price of a new mobile home was $124,900 this May, the most recent month for which there is data, according to the U.S. Census.
"A lot of it is a scarcity issue," said Alyson Snow, a housing rights lawyer who represents several mobile homeowners pro-bono and a professor at the University of San Diego's School of Law.
During the pandemic, factories were slower to roll out the parts needed for new manufactured homes, and there were fewer builders around, she said.
"Those shortages created fewer mobile homes in the market," said Snow.
And there are other risks associated with making any big purchase, said Snow. Buyers who take out bank loans are often hit with high interest rates and hidden fees, she said. People buying used mobile homes need to be sure that they're getting proper inspections, as well.
Plus, because mobile homeowners don't own the land their homes sit on, they constantly face the possibility of eviction.
"You are at the mercy of who's going to rent you the land," she said.
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