With 17 million Americans living in manufactured housing, such housing has become a critical part of the nation’s affordable housing stock.

Manufactured housing is built to the Federal Manufactured Construction and Safety Standards of 1974, known as the HUD Code. The HUD Code dictates standards in internal systems, design, construction, transportation, energy efficiency, wind resistance, and fire safety for all manufactured homes. This distinguishes manufactured housing from other types of factory-built housing, such as modular or panelized housing, both of which are built to local code,  and from mobile homes, which are factory-built housing units produced before the HUD Code’s effective date of June 1976.

Federal policy at the time looked to the private sector to create affordable rental units because it had the necessary capacity and political clout. Under the big production programs, the government’s primary policy goals were to house low-income people and reduce their rent burdens. The leading motivation of the typical property owner, on the other hand, was to make a profit—both as an operator of an apartment building during the contract term and through the reuse of the building when the government contract ended. There was nothing wrong with the owners’ intentions, and they were clearly articulated in the contracts that they entered into, but the goals of the government and the for-profit owners were not necessarily in alignment. That is especially true considering the lack of restrictions on ending the affordable use of the properties once the contract terms ran their course.
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The efficiency of using factory production to build to a single national code means that manufactured housing can offer significant cost savings over site-built housing, as many low- and moderate-income homeowners have long known. From 1993 to 1999, for example, manufactured housing accounted for nearly one-quarter of the growth in homeownership among very low-income families.3 Further, quality improvements and design innovations mean that modern manufactured homes are comparable to site-built homes.

Manufactured housing offers opportunities to both expand and preserve the supply of affordable housing. In the late 1990s, two-thirds of new affordable homes were manufactured, and a growing number of fee simple4 projects demonstrate that manufactured housing can adapt to urban infill lots as readily as suburban subdivisions or rural scattered sites. At the same time, 35 percent of manufactured homes are located in manufactured-housing communities, or “parks,” where they rent the land beneath their homes.5 Those homes are a crucial part of a dwindling reserve of existing affordable housing.

This is an excerpt from The NEXT American Opportunity. The full text can be downloaded as an Adobe PDF Document.