Conventional financing will play a bigger role in the growth of today’s manufactured housing as more of the home-buying population recognizes their affordability and value. When manufactured homes are titled to the land they are placed upon, they are considered real estate. They appreciate and depreciate in the same way as traditional site-built homes. The appraising and valuation of today’s manufactured homes play an important part in obtaining a low-interest, 30-year fixed-rate mortgage loan. The unexpected challenge that lenders have uncovered, is the bias residential real estate appraisers have towards today’s manufactured homes.
We invited Tony Wicke, Executive Vice President for Retail Lending at Land Home Financial, a well-respected mortgage lender, Jed Lowman, New Construction Specialist with Nexa Mortgage, an experienced mortgage broker, and Paul Jackson, Real Estate Appraiser for STX Valuation Services, to share their experience and insights with appraisals on manufactured homes to address the challenges facing the growth of manufactured housing.
All agreed that the manufactured housing industry is in the best position to shine as a scalable solution to address the growing housing gap that exists in our country. Manufactured housing recognized as real estate creates the opportunity for greater adoption from a larger share of the home-buying population according to Wicke. Manufactured housing is not just affordable housing for lower-income families, it’s attainable housing at different price points and becomes a choice. If you compare a $250,000 manufactured home eligible for MH Advantage™ or CHOICEHome™ financing to a similar site-built home at the same price, most consumers will be surprised with today’s manufactured housing.
Which house is site-built?*
Jackson advised that new site-built homes in South Texas are out of reach for the population that needs it the most, first-time home buyers. After eight years of appraising manufactured homes, he stated that the quality and value are on par with similar site-built homes, and appraising them using site-built comparables provides a true value. The key is access to information on the property and the requirements for financing. Lowman pointed out that his construction-permanent lending has been going strong because there’s a greater awareness of the value that comes with manufactured homes. He believes that in order for conventionally financed manufactured homes to grow, lenders must be thorough in providing the appraiser with the detailed plans and specifications that will help the appraiser in their valuation. Lowman added that the role of the retailer is just as important since they are the primary source of information for the appraiser.
Education was a salient theme of the discussion. By providing access to training programs on MH Advantage™ and CHOICEHome™ that provide continuing education credit, appraisers and real estate professionals can be part of the solution in the valuation of today’s manufactured housing. The bias against manufactured housing is real and provides an opportunity for greater awareness of today’s manufactured homes. When a new manufactured home is fairly compared to a similarly new construction site-built home in the same community without bias towards its construction process, it will be considered simply as a new home which is the goal of our industry. For more information and resources on today’s manufactured housing eligible for MH Advantage™ financing click on the following link: mha.manufacturedhomes.com.
Our next webinar will be on Thursday, July 15th at 11:00 AM PST / 2:00 PM EST. We will be focusing on the important topic of maximizing your digital presence. Regardless of the space you occupy in the housing industry, more and more of our business is conducted online. Your digital presence is fundamental to attracting, engaging, and serving your customers. Whether you’re new to social media and eCommerce, or are an expert, you’ll want to join us.
*Answer: House B