One of the advantages of choosing a mobile home is that it is often a lower-cost option to having a stick-built house. Simply put, it generally costs less per square foot so that you get more space for your hard-earned money.
Additionally, today’s mobile homes are built in controlled environments to ensure that they meet a rigorous set of standards, and that homebuyers are less likely to experience construction delays.
To help you choose a mobile home that is a worthwhile investment, we list the most important things you must consider before making a purchase.
There are several guidelines on how much home you should purchase based on your annual income, although the most common advice is to choose a house with a mortgage payment that will not exceed 31% of your gross monthly income.
Another guideline, which many lenders use to calculate a borrower’s creditworthiness when buying a home, is the “2.5 times” rule; this means that your home should not cost more than 2.5 times of your annual gross income. Following this example, if your annual salary is $40,000, choose a home that costs no more than $150,000.
Meanwhile, the list below shows the average cost of each type of mobile home:
- Single wide – $51,000
- Double wide – $96,500
- Triple wide or multi-wide – $100,000 – $250,000
Conduct background research on manufacturers
While all mobile home manufacturers have to follow a strict set of construction codes and regulations, there are still some differences in layouts, warranties, price, and post-purchase services.
A good rule of thumb is to choose a mobile home manufacturer that offers energy-efficient construction and customizations to fit your budget and style.
Talk to mobile homeowners
An excellent way to learn about the benefits and challenges of having a mobile home is to talk to owners who can also share their experience when they first bought their manufactured house.
Find local sellers
Find local sellers or dealerships that can give you a tour to see different mobile home layouts and designs.
Manufactured home dealerships act like your typical car dealerships since they also offer a variety of models you can choose from based on layout, material, price range, etc. Some dealers also sell more than one brand, while factory dealers offer homes from only one manufacturer.
Note: Real estate agents can sell mobile homes if they are stationary, i.e., they are fixed to a plot of land.
Find a community
You can find a local mobile home community through online listings and brokers, especially pocket listings. Make sure that you understand the different tenancy agreements with the park.
Some communities retain ownership of both the mobile homes and lots, while others only lease the land. However, some parks are run like a traditional real estate complex, meaning you can buy both the home and the lot where it sits. If you choose the latter, make sure that you understand that communities are still managed by some type of board of trustees who set their own rules and regulations.
Consider your financing options
If you plan to purchase a mobile home, you have two financial options: traditional mortgages and chattel loans.
If the home is permanently fixed to the land and you own the lot (or at least consider buying it), you may probably qualify for a traditional mortgage. By contrast, chattel loans are for properties that are “movable,” such as mobile homes that are not yet affixed, houseboats, planes, and yachts.
Chattel loans generally come with higher interest rates and shorter repayment periods than most traditional mortgage loans.
Is It Worth to Buy a Mobile Home?
A mobile home is an affordable housing investment with the right financing and careful planning. Also, you have to consider the location, size, type of ownership (renting vs. owning the land), and financial commitment, especially the monthly mortgage payment, to make a sound decision.