Mobile Homes Advocated to Congress as Remedy to Lack of Affordable Housing
WASHINGTON — Many of the problems for low-income persons seeking affordable housing would disappear if the government encouraged more ownership of manufactured homes, according to industry advocates who testified to Congress Thursday.
Manufactured homes can cost half as much as traditional houses but offer the same benefits, they told the House Appropriations Subcommittee on Transportation, Housing and Urban Development.
“Manufactured housing is the largest source of affordable housing in the country,” said George McCarthy, president of the Massachusetts-based nonprofit Lincoln Institute of Land Policy.
Manufactured houses, also known as mobile homes, represent 6.3% of the nation’s housing stock but could be much higher if government home financing programs were more available for purchasers, McCarthy and other witnesses said.
The congressional panel is considering incentives for manufactured housing as the economy struggles under inflation and the COVID-19 pandemic. Meanwhile, home prices are rising.
Home prices rose 34.4% over the past two years. Federal Reserve Economic Data shows the median price of houses sold in 2022 is $428,700.
As a result, the nation’s homeownership rate fell faster last year than any time in the last 80 years. It continues dropping this year, down to 65.40% in the first quarter of 2022 from 65.50% in the fourth quarter of 2021, according to the U.S. Census Bureau.
“Federal solutions must drive toward a single goal,” namely homeownership, McCarthy said.
The solutions he and other housing advocates seek include greater availability of mortgages for low-income persons seeking mobile homes through the Federal Housing Administration. They also want to expand the market for secondary mortgages on manufactured homes through the government-sponsored enterprises Freddie Mac and Fannie Mae.
They said vacant or blighted properties could be revitalized by rezoning them to allow mobile home communities to take their place.
Rep. David E. Price, D-N.C., the housing subcommittee chairman, said manufactured housing and mobile home parks have moved beyond their old image as flimsy, temporary residences.
“They’re no longer transient,” Price said. “In fact, they’re stable communities.”
Their move into respectability also has created a challenge for them to continue being affordable, according to housing advocates.
Private equity firms increasingly see them as an investment opportunity. The investors will purchase an entire mobile home park with little notice to residents then raise their rent, water, sewage and trash disposal fees.
“For many homeowners, including a substantial portion who live on fixed incomes, this can force them into impossible conditions,” Price said.
“It’s all based on cash flow,” said Mary O’Hara, executive vice president of ROC USA, a New Hampshire organization that advocates for mobile home communities to remain resident-owned rather than being taken over by corporate investors.
“These communities are at risk of being sold to the highest bidder” or even being bulldozed to make room for industrial development, O’Hara said.
The result can be that some residents and families face homelessness.
The congressional panel is not pursuing a specific solution. It is seeking advice from the manufactured housing industry as it puts together its 2023 budget proposal for the U.S. Department of Housing and Urban Development.
HUD is the federal government’s lead agency for finding affordable housing. Its solutions can include providing housing subsidies to low-income persons.
Rep. Mario Diaz-Balart, R-Fla., hinted that HUD might want to consider extending its housing assistance to mobile home park residents.
“Many of these folks who live in these homes are not HUD housing recipients,” Diaz-Balart said.
Tom can be reached at [email protected] and @TomRamstack
