For homebuyers looking to buy single-family properties, alternatives to traditional houses can be a more affordable option. Jacob Channel, senior economist for LendingTree, says mobile homes, condos or townhouses are still cheaper than single-family homes, even as values rise for these alternatives.
A new LendingTree study found that mobile homes are cheaper and their values appreciated almost as quickly as single-family homes over five years, from 2016 to 2021.
Key findings of the study show:
- On a national scale, the median value of a mobile home is $61,400 to $220,000 less than that of a single-family home, although median mobile home values increased by an average of 34.58% from 2016 to 2021. On the other hand, median single-family home values increased by almost a similar average of 35.44% for the same time period.
- Mobile homes in Kansas, Ohio and Iowa are the cheapest, with a median value of $29,000 or less. Meanwhile, single-family homes in these states cost $174,000 or more.
- Mobile homes in Washington, Nevada, Oregon and California are the most expensive, with a median value of $146,500, $114,000, $113,500 and $110,200, respectively. Only in these states are median mobile home values more than $100,000.
- Mobile and single-family homes in California, Colorado and Massachusetts have the highest difference in median price. Median-priced mobile homes cost $537,900, $404,000 and $390,300 less in these states than median-priced single-family homes. The differences in median prices in West Virginia, Oklahoma and Mississippi are less than $105,000.
- The states with the highest increase in the median value for mobile homes from 2016 to 2021 are Rhode Island, Nebraska and Idaho. Values have increased by 110.82% in these years, which is more than double the value before 2016. On the other hand, median single-family home values in these states appreciated by an average of 57.95% during this period.
- The states with the least increase in the median value for mobile homes are Vermont, Alaska, North Dakota and New Jersey. The value increased by 2.28%, 4.13%, 7.33% and 9.11% respectively, making them the only four states where values increased by less than 10%.
While Channel suggests buying mobile homes for their relatively low prices, he also lists some drawbacks associated with this choice. Based on his observations, the value of mobile homes appreciate over time but owners often find it difficult to resell them.
Moreover, securing loans for such homes is challenging as lenders think of them as “riskier” investments than other types of houses, especially for people with low credit scores or those who want to buy mobile homes on land they do not own.
Additionally, associated costs like trailer park or land access fees add on to the stress of buyers and dissuade buyers from making a purchase.
To do their analysis, LendingTree referred to the U.S. Census Bureau’s 2021 American Community Survey and the 2016 American Community Survey with one-year estimates for every state except Hawaii. Hawaii was excluded due to insufficient data over the five years (2016-2021) on mobile homes and the state’s strict zoning laws around mobile-home parks.
In 2021, Channel on HousingWire Daily examined LendingTree’s migration report, which highlighted the top housing markets for homeowners. He also analyzed homebuyer trends during that year.
