depreciation

[Karl]

What, if anything, is the manufactured home industry doing to combat the depreciation problem in manufactured homes? The issue seems to be the one major drawback of a manufactured home. Why buy a home for, say, $45,000 one year and see its value drop by $10 thousand in just a couple of years? Even a semi-shack stick built home will hold its value or go up in value in most cases, if it is adequately maintained. I think the manufacturers of manufactured homes need to address this issue and fight it head on, though I don't really have any suggestions of how this can be accomplished.

[Atlanta]

Karl, I urge you to go back through this website and read postings about the so-called "problem" of depreciation. It just ain't so! Real estate agents are famous for putting that idea out because when you buy a manufactured home, they don't make any commission - they want to take you out and sell you a site-built home which puts money in their pockets. Nothing wrong with wanting to make money, but they don't know what the hell they're talking about when they start that depreciation business. If you don't believe it, go to the MLS listings in your area on the internet and notice what older manufactured homes are selling for. I've done this and I found that the price is comparable to site built homes of similar square footage in the same area. Example: MLS# 596082 - mobile home on permanent foundation in Dawsonville, GA (northwest of Atlanta), excellent condition, sitting on 1.44 acres $104,900. Another double-wide MLS# 590879- also in Dawsonville - built in 1988 - (14 years old!) - on 1.74 acres - $90,000. The list goes on and on and you can check it out yourself. I guarantee you that the owner of the 1988 double-wide did not pay anywhere NEAR $90,000 (including the land) back in 1988 for that manufactured home. Here's one more - MLS# 698688 - 2001 double-wide on 2.5 acres - $94,900 only this one is not even on a permanent foundation.

I've gone out house-hunting with a real estate agent and have been shown manufactured homes for sale that were not in that great of a condition, yet the prices were right up there.

Now that I've said all that, I'll admit that I'm still wrestling with the problem only because a social-climbing acquaintance of mine keeps insisting that depreciation is a problem. Once somebody puts that idea in your head, it's hard to shake off because there are thousands of (your) dollars involved - it's a huge investment, yet when I look at site-builts in the price range I'm comfortable with ($100,000 or less), they're one -or all- of these things: too small, in need of repairs, right on top of the neighbor next door, only have one bathroom, ugly, tiny kitchen/bathroom, carpet in bad shape, undesirable area, or it's a townhouse, not a single-family dwelling. On the other hand, a new manufactured home can be ordered exactly like I want it, the kitchens are huge, I LOVE the glamour bath, the insulation is better (or can be ordered that way), everything is NEW and I get much more square footage for the same amount of money. There's really no comparison! I think the problem that the manufactured housing industry really needs to address is the fact that county commissions are putting restrictions on land that makes it impossible to buy a manufactured home - either because the land available is too far out from jobs in the cities, or because they stipulate (for instance) five acres for a m-h, and most folks can't afford the 5 acres AND the house. THAT is the problem I would like to see addressed.

Hope you'll check out the real estate listings in your area. I think it'll put your mind at ease about the depreciation factor.

[rmurray]

The other post here from a non-industry person is excellent...Manufactured Homes and land react to the local market just like any other house...Manufactured Home only resales return WAY more on the resale than a stick built home ONLY sale..either way manufactured homes do very well..


There is a search button on these forums that will return scores of posts on the topic...You will find links to the definitive studies of this situation..Sufice it to say...this is an old wives tale..

[James]

I would belive that if Man. homes were built to the same standards they currently are, but resembled a stick built house more (such as a higher pitched roof, and 8' interior wall) there may be less opposition. I know the modular homes are a option but the price is greater.
I am currently looking for a man. home but havent found one yet. The land is also a major issue, the county I live in does have a 10 acre lot size requirement. I find this ironic because in the county news letter this month the board of supervisors where concerned that lower income families could not afford to move or live in the county, yet they impose a lot restriction such as this when a 10 acre lot is selling for 90 grand.

[Atlanta]

That's interesting. The politicians really don't want those lower income folks unless they can be crammed into those teeny-tiny zero-lot line houses that sell for a ridiculous amount. Example: one of those developments in Canton, GA is selling 2-bedroom, 2-bath units BEGINNING at $104,000. These places are TINY - they're very narrow and the kitchen is hardly large enough to swing a cat by the tail. Then in addition to your house payment, you've got the home-owners association dues which, in this case, is $85 a month! The units sit right on the street and I predict that in 5 or 6 years, places like this will be run-down and mainly rentals. But the TAXES on these homes are going to feed the monster known as Government much more money than a spacious manufactured home so they'll allow the developers (who, no doubt, have crossed the bureaucrats' palms with silver) to throw these middle-class ghettoes up, and they'll make it impossible for you and me to live in the type of housing we want. These bureaucrats need to be voted out of office, but it won't happen, and you know why? Because most people are so concerned with the 'not-in-my-neighborhood" problem - i.e., they believe that a manufactured home next door will cause their little cracker-box tract house to depreciate, that they don't care about the fact that the elected officials are violating the rights of people who prefer not to live like rats. As long as THEIR ox isn't being gored, they don't care. As long as people don't understand the concept of Freedom, we'll keep electing these ignorant/arrogant bureaucrats and you and I will continue to be forced into the middle class ghetto type of housing. It's DISCRIMINATION, pure and simple.