As 2025 draws to a close, the manufactured housing industry finds itself in a stronger, more visible position than many gave it credit for, yet also facing critical headwinds. On the bright side, demand continues to grow as affordability pressures mount across the nation. Rates are stabilizing, costs are holding (for now), and need is great. Pew Charitable Trusts reports that factory-built homes remain among the most cost-effective paths to homeownership: many manufactured homes cost well below their site-built equivalents. Meanwhile, high occupancy rates in manufactured-home communities (particularly in Sun Belt states) reflect enduring resident demand and stability, and many of these home buyers buy their homes with cash. The industry is evolving; builders are embracing modern techniques, increasing quality, energy efficiency, and design standards that more closely match what homebuyers expect of traditional homes (varied roof pitches, interior ceiling height, exterior elevations, and superior energy efficiency).
Yet significant challenges remain. Traditional site-built homes, even at today’s elevated prices and interest rates, still draw much of the public and lender attention. Affordability for manufactured-home buyers isn’t just about the home; land costs, lot rents, financing terms, and zoning/barriers continue to create friction and present barriers to affordability. As one recent industry study noted, approximately ~71% of U.S. households remain unable to afford median-priced new traditional homes ($462,206 in May 2025). This keeps pressure on MH and other solutions to fill the gap. And even though factory-built housing offers faster production cycles than traditional builds, rising demand, combined with supply chain, regulatory, and labor headwinds, means that not all future demand may be met quickly or equitably (and yet we see rapid build times and delivery, as of this Monthly Memo).
However, 2025 delivered important breakthroughs and emerging trends, supporting increased demand into 2026 that hint at the future direction for manufactured housing. Modular construction technologies, which blend the precision and cost advantages of factory builds with flexible, modern design, are gaining traction and will continue to blur the difference between Modular and Manufactured with the passing of the Road to Housing Act 2025 (anticipated). Builders and developers increasingly market manufactured and modular homes not as “temporary or second-class” housing, but as a legitimate, affordable, sustainable, and appreciating asset option for long-term homeownership. Institutional investment and growth in manufactured-home communities (MHCs), especially in rapidly growing Sun Belt markets, reinforce this shift; and occupancy is rising due to the overwhelming need. But more greenfield development is needed, as older “parks” are closed for alternate use of land.
The broader housing market outlook for 2026 suggests a modest but meaningful rebound (though modest), one that could (and should) strengthen the case for manufactured homes. According to Realtor.com, 2026 home prices are forecast to rise around 2.2%, but inflation-adjusted prices may actually slip, while affordability improves as monthly payment burdens drop below 30% of median income nationwide for the first time since 2022. That’s a great thing. In a more balanced overall market, with overall housing inventories rising, modest price growth, wages catching up to costs, and slightly lower interest rates, buyers looking for affordability and value may turn increasingly toward manufactured housing options. This market may add to the increased activity by traditional MH markets, as we open new locations to manufactured housing.
This is where the industry’s broader mission becomes crucial. Millions of American families are still priced out of traditional homes (and will continue to be), renting in expensive, unstable markets, or forced into overcrowded living situations. Manufactured housing offers a powerful tool to bridge that gap if the industry, advocates, policymakers, and lenders work together. We must continue pushing for better financing conditions, clearer zoning rules, and greater public awareness. We must keep raising the standard of design, build quality, energy efficiency, and community planning so that manufactured homes deliver not just affordability, but dignity, stability, and long-term value.
Looking ahead to 2026 and beyond, the potential is real; the threats are real as well. With modest improvement in the overall housing market, a continuing affordability crisis for millions of Americans, and technological advances in modular and factory-built housing, manufactured homes can play a growing and critical role. Our industry must continue its efforts to seize this momentum with innovation, advocacy, and high-quality delivery. MH has the opportunity to deliver real homes for real people, giving families across the country the chance to own a home they can afford. It’s time for all of us to step out of our comfort zone.