The average price of a stick-built home in the United States today is over $280,000 and that isn’t even a new home! New homes average over $350,000 in today’s market. Now let’s take a look into manufactured housing as an affordable alternative. You can buy a 2016 model three bedroom, two bathroom mobile home for between $45,000 and $50,000 on average. That is less than a conventional 20% down payment for a site-built house at today’s prices!
WHAT MAKES A MOBILE HOME AN AFFORDABLE ALTERNATIVE?
Purchase price alone is not the only factor that makes mobile homes a very affordable option for millions of Americans today; whether they are first-time home buyers, looking to get back into homeownership after the housing market crash of 2007, or retirees looking to down-size.
Other factors that make mobile homes an inexpensive and attractive option for homeownership include:
Let’s dive into each of these factors a bit more in depth.
Lower Price Per Square Foot
Depending on the area of the United States you live in and how the local housing market is performing on average you can expect to pay between $250 and $500 per square foot of a traditional, stick-built home. Mobile homes provide a much, much lower price square foot with price per square foot ranging between $25 to $60. The short version is that you can expect to pay at least 50% LESS per square foot when buying a mobile home versus stick-built home.
Higher Debt-to-Income Ratio
When looking to buy a stick-built house, generally across the board you cannot get a mortgage if your debt-to-income ratio is greater than 43%. However, the Manufactured Housing Industry has been able to partner with lending institutions who have been known to accept a higher debt-to-income ratio, up to even 50%. This allows millions of Americans with student loan debt, car payments, or credit card debt to be able to afford to buy an inexpensive mobile home.
Lower Down Payment
A down payment for a conventional loan on a stick-built home is generally 20% of the purchase price. In many situations, our industry lending partners are able to keep down payments as low as 5% of a mobile home purchase price. This means you are able to buy a home with much less cash on hand. Your down payment for a mobile home that is only a couple years old could be as low as $1250. That’s less than a monthly rent payment in most of the United States!
Quicker Closing Time
We have all heard it before, time is money. A closing for a stick-built home is generally between 30-45 days. If you are looking to buy a mobile home, you can expect to close much sooner on your home. Some closings can be completed in as little as 10 days! This means you stop making those rent payments and get out of your rental home much sooner.
Long story short, Mobile homes provide a very affordable option for homeownership. The United States rental market has taken off and for most of America it is literally more cost-effective to buy a home than rent one. On average you can expect to pay around $1000 per month for a brand, NEW mobile home, including lot rent. If you buy a mobile home that is a couple of years old you are looking at roughly $850/month to own your home, lot rent included.
If you are in the market for a home, mobile homes can provide an affordable option for achieving the American Dream of homeownership! Find homes near you today.
•All prices and percentages in this article can vary based on specific situations. All figures are generalized averages of today’s prices.