Policy Barriers Prevent Construction of Affordable Manufactured Housing

Manufactured housing offers a less expensive option for homebuyers than other types of single-family homes. Nationwide, manufactured homes make up only about 6% of all homes, but they are especially scarce in some parts of the country where other single-family homes are common.To better understand the drivers of those differences and to identify policy reforms that could increase the availability of manufactured housing, The Pew Charitable Trusts commissioned a study, “A Review of Barriers to Greater Use of Manufactured Housing for Entry-Level Homeownership,” from Harvard University’s Joint Center for Housing Studies.

Among the key barriers noted in the study were outdated perceptions of manufactured homes and exclusionary zoning laws that bar this housing type in single-family neighborhoods. In addition, some states’ titling laws can block manufactured home buyers from accessing mortgage financing, pushing buyers into alternative finance models that tend to have higher interest rates—which reduce affordability—and fewer consumer protections than mortgages.

The study also identified areas where manufactured homes offer the most potential to improve access to homeownership, including 845 counties where low land costs could help enable affordable opportunities. Because most owners of manufactured homes also own, rather than rent, the land beneath their homes, the Harvard team focused on opportunities to expand homeownership for landowners.

The Pew Charitable Trusts provided funding for this project, but Pew is not responsible for errors in this paper and does not necessarily endorse its findings or conclusions.