UBC vs. HUD on resale value

[Adriana]

We are shopping for a home to put on a permanent foundation. We keep getting conflicting information on UBC vs HUD built homes. Will the code make a difference on the resale value of the property?
We have mainly been dealing with a Cavco retailer and he says that it is worth the extra $6000 to have it built UBC. We also spoke to a Palm Harbor rep and they say they build "foundation ready" for under $400 extra. They claim that it is not necessary to have it built UBC, but than again they don't offer the option.
Could somebody please advice me on what is the right way to go?
Also, any comments on which of these 2 manufacturers is better?
Thanks for the help.

[Adriana]

BTW, we live in Riverside, CA.

[Tom]

All singlewide and doublewide homes are built only to the HUD standard, Modular homes are built to either state building codes or UBC. It is an oversimplification, but genereally homes delivered to a site on flat bed semi's and erected in modules are "modular homes" built to UBC or state codes. MH delivered to site on wheels and set on permanent foundations are built to HUD standards.

[Adriana]

Thanks for the info Tom. Do you have any idea on how the diffecence affects appraisal and/or resale value?

[Tom]

Can't give you a difinitive answer on the appraisal question. As you probably heard it said in real estate, "location, location, location" is the most important factor in any homes appraisal. Appraisers use "comps" (comparable homes in the same location as your home)to determine price. (Appraisers also roll in style of home, inside and outside options, etc.)

If your home is in a location of similar modular UBC homes, then there would probably be little impact on value of the home.(assume you own the land and have a permanent foundation.) Your home value would be comparable with the others. If it were HUD and in all HUD development, again, probably be little impact on value of the home. If either HUD or UBC home is in a stick built addition, then the value could still hold (as long as you own the land and have the permanent foundation) but your appraisal could be slightly below the other homes. (Though, it depends on the appraiser's review.) Appraising is an art, rather than a science.

[Tom]

Can't give you a difinitive answer on the appraisal question. As you probably heard it said in real estate, "location, location, location" is the most important factor in any homes appraisal. Appraisers use "comps" (comparable homes in the same location as your home)to determine price. (Appraisers also roll in style of home, inside and outside options, etc.)

If your home is in a location of similar modular UBC homes, then there would probably be little impact on value of the home.(assume you own the land and have a permanent foundation.) Your home value would be comparable with the others. If it were HUD and in all HUD development, again, probably be little impact on value of the home. If either HUD or UBC home is in a stick built addition, then the value could still hold (as long as you own the land and have the permanent foundation) but your appraisal could be slightly below the other homes. (Though, it depends on the appraiser's review.) Appraising is an art, rather than a science.

[Tom]

Can't give you a difinitive answer on the appraisal question. As you probably heard it said in real estate, "location, location, location" is the most important factor in any homes appraisal. Appraisers use "comps" (comparable homes in the same location as your home)to determine price. (Appraisers also roll in style of home, inside and outside options, etc.)

If your home is in a location of similar modular UBC homes, then there would probably be little impact on value of the home.(assume you own the land and have a permanent foundation.) Your home value would be comparable with the others. If it were HUD and in all HUD development, again, probably be little impact on value of the home. If either HUD or UBC home is in a stick built addition, then the value could still hold (as long as you own the land and have the permanent foundation) but your appraisal could be slightly below the other homes. (Though, it depends on the appraiser's review.) Appraising is an art, rather than a science.

[rmurray]

Appraisors do not buy homes..people do...Resale is a function mostly of location..location..location..condition..

Sounds like you have a good location..Go for it..

[Barbara]

I can answer that question. I have been going down the same road, and recently discovered UBC homes. There are two huge differences. First, Manufactured homes have to be disclosed and appraised as such, even on a permanent foundation, whereas UBC homes are appraised as a "site built" home (which could really add value). I confirmed this with Wells Fargo. Second, if you ever want to refi and take cash out, you can't with a Manufactured home, you have to have more than 40% equity (last I checked 3/1/04), whereas with a UBC home is just like any home with regards to refi. For resale, the top lenders have been changing their requirements a lot lately regarding lending on a Manufactured home, making it a bit harder to buy one, whereas "site built" is always "site built" terms. There are also a couple of makers out there regarding UBC homes, I have found at least three. I hope that helps. I live in Riverside Co also and I do know that the person who I am dealing with said the only problem with the UBC and the county could be they don't know what it is, so don't let them tell you it is a Manufactured home, it is "site built". Good Luck!!!