Impact of Manufactured Housing on Property Values

For years, many people have believed that having manufactured housing, either on a scattered site or in communities, near or adjacent to site-built housing would depreciate the property values of the site-built housing. There is little evidence to support this notion, yet this belief has been used time and again to block manufactured housing developments. In fact, all the recent studies on the subject have come to the conclusion that manufactured homes, either in communities or on individual lots, have no impact on the property values of site-built homes that are adjacent to or in close proximity to them.

One of the first studies to tackle this issue was produced in 1986 by the Joint Center for Housing Studies of the Massachusetts Institute of Technology and Harvard University. In its analysis of a New Hampshire town without zoning restrictions for manufactured housing, the authors could find no statistically significant evidence that manufactured housing had any impact on adjacent site-built homes. ⁵

This conclusion was also supported by a 1993 study by the University of Michigan's College of Architecture and Planning. In its examination of the impact of three Michigan manufactured home communities on adjacent residential property values, the authors stated:

...in all the cases we reviewed, the adjacent residential property values showed substantial rates of appreciation that were similar to the appreciation of comparable non-adjacent properties. We found that neither the private market nor local public officials differentiate between adjacent and non-adjacent properties when valuation levels are established. 6

And in 1997, the East Carolina University Department of Planning conducted the most extensive study to date on the topic. Using Geographical Information Systems (GIS) and spatial analysis, the authors analyzed the impact of both scattered manufactured housing and manufactured home communities on neighboring site-built homes in four North Carolina counties (Carteret, Henderson, Pitt and Wake). Even this extensive study came to the conclusion that the presence of manufactured home communities or individual manufactured homes had no impact on the property values of adjacent site-built residential properties. ⁷

Do manufactured homes appreciate in value?
In general, manufactured homes will appreciate at the same market rate as other homes in the same neighborhood, but, as with all housing, it is subject to the same market factors which affect appreciation. The factors that impact future value include:

 

 

the housing market in which the home is located;

 

the community in which the home is located;

 

the initial price paid for the home;

 

the age and maintenance of the home;

 

the inflation rate; influences on the home's value; and

 

the extent of an organized resale network, where an organized network will usually result in homes selling for a higher price than in markets without such an organized network.

5 Thomas E. Nutt-Powell, David Hoaglin and Jonathan Layzer, Residential Property Value and Manufactured Homes, Working Paper 86-1, Joint Center for Housing Studies of the Massachusetts Institute of Technology and Harvard University, 1986

6 Kate Warner and Jeff Scheurer, Manufactured Housing Impacts on Adjacent Property Values, Manufactured Housing Research Project Report No. 4, University of Michigan College of Architecture & Urban Planning, 1993

7 Guaqiang Shen and Richard Stephenson, The Impact of Manufactured Housing on Adjacent Site-Built Residential Properties in North Carolina, East Carolina University Department of Planning, 1997

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