While at the Ford Foundation working on affordable housing, Lincoln Institute President George W. “Mac” McCarthy became convinced about the huge potential of an unrecognized sector of the national housing stock – manufactured homes. Setting aside the scorn of trailer parks, “redneck Riverias,” and Kentucky double-wides, he discovered that homes built in factories represent the largest unsubsidized affordable housing stock in the U.S. Almost 8 million families, with a median income of $29,000, reside in manufactured homes.
In the final Lincoln Lecture of the spring season last month, From Social Stigma to Housing Solution: The Case of Manufactured Housing, McCarthy reported on the work of a group of plucky social entrepreneurs who embarked on a quixotic effort to transform the manufactured housing sector -- and the unexpected results of their efforts to preserve and expand this essential component of the national affordable housing stock.
While efficient manufacturing reduces production costs and high-density, low impact development promotes smart growth, newer homes often outperform site-built housing in both quality and design. And yet, with a few notable exceptions, affordable housing practitioners remain ignorant of, or are openly hostile toward, this housing stock—instead of embracing it as a potential solution to affordable housing challenges.
In the 1990s, manufactured housing accounted for two-thirds of new affordable single family housing, and nearly half of homes under $150,000. Over two-thirds of these homeowners earn less than $50,000 (80 percent of median income for most regions). More than 80 percent never move. Contrary to popular belief, the homes aren’t assets that diminish in value over time, so long as families control the land under their homes. There are an estimated 50,000 manufactured home communities in 3,100 counties, with an estimated three million homeowners who lease the land beneath their homes.
A key effort is to get the manufactured home industry to produce better products – something that has been embraced by Warren Buffet in Clayton Homes. “People are doing it right and making money,” McCarthy said. The Federal Housing Administration has changed rules to improve financing, though as McCarthy noted, “People who own manufactured homes are still paying too much in the lending.”
The July issue of Land Lines featured an article on manufactured homes, From Stigma to Housing Fix: The Evolution of Manufactured Homes. Earlier this year, another article published in Hawaii looked at greater openness to manufactured homes. George McCarthy’s full lecture can be viewed here.