New-Certified “Half Price Homes” - Affordable Housing Solution Redux

‘If it sounds too good to be true, maybe it’s not true.’ That’s a common reaction to the first part of the headline that was first reported on the Tampa Free Press. An array of semi-automatic notions and human habits may kick in. ‘It sounds too good, surely it can’t be true, so it must be a scam.’ That’s entirely understandable. That said, not only is this true, odds are that you or someone you know has experienced or seen this proven solution to the affordable housing crisis, and just didn't realize how important this could be.

The National Association of Realtors (NAR) Journal of Real Estate Studies and a doctoral thesis with Walden University by Lisa Tyler, Ph.D., are among the third-party sources that have reported in depth on this phenomenon. Harvard University's Joint Center for Housing Studies (JCHS), the Urban Institute, the U.S. Department of Housing and Urban Development (HUD), and Freddie Mac are just some of the other sources that have probed this subject as a proven solution to the U.S. affordable housing crisis. There are reasons why this is misunderstood and downplayed, more on that later. But for now, note that the U.S. Census Bureau has said that these federally certified, 3rd party inspected, and consumer protections backed homes are about half the cost of conventional construction.

Last year, in Polk County, Florida, about 1200 home loans were originated for one of these surprising homes, per Consumer Financial Protection Bureau (CFPB) data. Indeed, the CFPB did a white paper on this form of innovative housing a decade ago, and odds are near perfect that you didn’t even know about it.

As the first article in this periodic series on the Patch revealed, it now costs about 80 percent more income to buy a house than it did 4 years ago.

The Lakeland Ledger thoughtfully published an evidence-based op-ed some 6 months ago, as did the left-leaning news aggregators Yahoo News and MSN published in full (2.25.2024) explained how no new laws or spending are necessary to close the affordable housing gap. The free market can do it with modern manufactured homes.

Freddie Mac said that most Americans are willing to buy a manufactured home. Why? Freddie Mac also provided research which debunked the common misconceptions about manufactured homes.

As millions know, about half of the manufactured homes in the U.S. are situated in a land-lease. While there are honest and ethical land-lease community operators, as well as resident owned communities (ROCs), there are sadly also unethical and so-called ‘predatory’ community operators too. But that means that roughly half of new manufactured homes are going onto privately owned parcels of land instead of into a land-lease.

Now, it just so happens that the photo above are all HUD Code manufactured homes. They are ground set, which has added costs, but are still far less expensive than a new site-built house. As the Yahoo News, Deseret News, and others have reported conventional builders can’t build a new house that a first time home buyer can afford. Who says? How about the prior CEO of the National Association of Home Builders (NAHB)?

Then Howard said in an interview with Fox Business: “Right now, in almost no market in this country, can a homebuilder build a house that is affordable for a first-time homebuyer.” He added: “We can’t do it. The costs that are on us make it impossible.”

The mobile homes and trailer houses of yesteryear evolved into the manufactured homes of today.

But let's be honest. For too many, over 600,000 of our fellow Americans in 2023 per federal data from HUD to Congress, were homeless. A huge percentage of American households, renters and home buyers alike, are struggling to make ends meet. Yes, that's partially a political and policy issue. But it is also a practical issue that potentially several million Americans could address without waiting for any politician.

In 2000, Congress enacted the widely bipartisan Manufactured Housing Improvement Act (a.k.a.: MHIA or 2000 Reform Act). It included consumer protections that are often not found on far more costly conventional houses. It also included what has been called “enhanced preemption.”

Both national trade organizations, the Manufactured Housing Association for Regulatory Reform (MHARR) and the Manufactured Housing Institute (MHI), have on paper stressed the meaning and importance of federal preemption. But regrettably, MHI has oddly failed to even mention those words legally significant words "enhanced preemption" on their own website.

By contrast, MHARR has referred to federal preemption and the Duty to Serve manufactured housing scores of times.

Some hate political or legal references, but there are times when they are useful.

Just as the enforcement of the U.S. border with Mexico has slipped (to put it politely) in the past 3.5 years into what has been called an open border, so too the enforcement by HUD of enhanced preemption for manufactured homes has only occurred on occasion. Who said? The former administrator for the HUD Code manufactured home program, the late William Wade "Bill" Matchneer, J.D.

Mainstream media has done a pretty good job of reporting on several of the problems facing the manufactured home industry. As was noted above, and in some of the linked reports, mainstream media has at times published useful items on the MHIA. But more could be done.

Because without millions of new 'half priced' manufactured homes, the affordable housing crisis can't be solved. All sorts of new housing are needed. Conventional, prefab, tiny, modular, and manufactured homes too.

The good news is that with manufactured housing, there is no need to wait for legislation. One problem is that too few know about the MHIA and federal preemption. Information, education and advocacy are thus useful.

As yesterday's post stated, if someone tries to buy a conventional house, about 80 percent more income is needed. But the exception to that sobering reality is for those who invest in one of several different styles of new manufactured homes that range from basic to stunningly beautiful. When the rich and famous buy a manufactured home, surely they are good enough for the rest of us, right?

There will be more on this practical and well researched solution in this periodic series in the days ahead. Stay tuned. ##

L. A. “Tony” Kovach and his family live in a manufactured home on about 1/3 of an acre in Winter Haven, FL. He is the co-founder of ManufacturedHomeLivingNews.com and ManufacturedHomeProNews.com, trade publications serving segments of the manufactured home industry. Having worked in several aspects of the industry for over 3 decades, Kovach is a widely acknowledged and often praised expert on manufactured housing.