When you make a living investing in real estate, it's important to choose the right properties for your portfolio. Not only should you focus on properties with strong rental income potential, but you should try to favor those with a tendency to appreciate in value over time.
But where do manufactured homes fit into that equation? Though they can be fairly inexpensive to buy, some investors might worry about their quality and longevity.
So how long do manufactured homes last? Let's dive in.
What's a manufactured home, anyway?
Some people use the terms "mobile home" and "manufactured home" interchangeably, and that's not completely wrong. Prior to 1976, manufactured homes were, in fact, known as mobile homes, but that terminology was adjusted that year when the Department of Housing and Urban Development (HUD) implemented changes and updated its construction standards for these homes. You'll still hear the term mobile home used frequently, but technically, the correct term is a manufactured home or modular home.
With all of that name talk out of the way, a manufactured home is constructed in a factory and then transported to a building site. These prefabricated houses are often indistinguishable from site-built homes, and they're generally not moved to a second location.
How much does a manufactured home cost?
A new manufactured home sells for an average price of $73,000, but that doesn't include land. The average site-built home, on the other hand, goes for $372,000. So there are major upfront savings with manufactured housing.
Why is a manufactured home so much cheaper? Aside from saving on land costs, modern manufactured homes are put together in factory environments, where builders can control every aspect of the construction process. A manufactured or modular home will generally use standard, cost-effective materials, and construction takes place in an indoor environment that prevents damage to materials and weather-related delays. Also, manufactured housing is constructed in bulk, saving money on building materials.
How long do manufactured homes last?
When installed properly, a manufactured or modular home can last just as long as a regular home built directly on a construction site. And manufactured homes that follow HUD code can last anywhere from 30 to 55 years.
However, these prefabricated houses can last longer if properly maintained. Furthermore, the manufactured home construction process is constantly evolving for the better, so the more modern the home, the longer it might last.
How to give your manufactured home a longer life span
If you're investing in a manufactured home, you'll want it to stay standing a really long time. You can help that home last longer by:
- Keeping up with maintenance -- for example, painting the home's exterior regularly and caulking all exterior seams where water could enter.
- Choosing the right location -- ideally, an area with no extreme humidity, which can cause building materials like wood to warp and degrade over time.
- Being vigilant about water damage -- addressing all plumbing leaks as soon as they occur and making sure the home is properly ventilated.
Is a manufactured home a good investment?
Given that manufactured homes are inexpensive to purchase and have a fairly long life span, they can be a good investment. But you'll also need to factor the cost of maintenance into your number-crunching when deciding whether to buy one.
Another thing you should know about buying a manufactured or modular home is that it may be more customizable than you'd think. For example, you may be offered a few different models, each with its own floor plan.
The bottom line
Ultimately, a manufactured home could be a good investment property, one with the potential for solid resale value over time. Just be prepared to maintain that home to ensure it not only lasts but that you're able to command top dollar for it once you're ready to sell.