Buying a Mobile Home Instead of a Regular Home: Pros and Cons

Finding an affordable place to live in the United States can be challenging. There are monetary and other advantages to buying a "mobile home" instead of a traditional, "stick-built" house, but there are disadvantages to consider, as well. Before you decide to buy a mobile home, let's weigh the pros and cons to make certain your decision is consistent with both your financial and housing goals.

Features of the Modern Mobile Home

Mobile homes, also known as "manufactured homes," are built in a factory and placed on a trailer chassis to allow them to be moved. They are often placed in a mobile home park or on leased land. In these cases, the owner rents a space or leases land, but owns the mobile home itself. Instead of a "deed," such as you would receive with a home, you will likely receive a "certificate of title," as with a car. (If you don't buy the home from the manufacturer, but instead from a previous owner, be sure that they transfer that certificate of title to you, not just the keys.)

If you buy straight from the manufacturer, you should also receive a warranty, covering defects in the structure and the appliances. If you buy a used mobile home, ask whether any warranties are still in force, and inspect it fully before completing the purchase.

Buyers might also be able to place mobile homes on land they own or are purchasing under contract. But you'll want to check local zoning rules first, to make sure they allow this use of land and that your home and its placement will meet basic construction, design, and setback requirements for the area.

Advantages of Buying a Mobile Home

One major advantage that mobile homes offer is that they're often a lower-cost option to having a stick-built home custom constructed for you. In this regard, mobile homes can make homeownership easier to achieve. And since mobile homes usually cost less per square foot than stick-built homes, you can get more space for your money.

On the other hand, some stick-built home builders offer standard floor plans and options, which allow them to build homes for prices similar to mobile homes. If you prefer a stick-built home, you might look into whether such a builder is in your area, and compare the quality of construction with a newer mobile home.

Another advantage you might find with mobile homes is flexibility. Since mobile homes are usually more affordable than stick-built homes and only semi-permanent, if you own land, you can place a mobile home on it now and remove it in the future (though removal isn't as easy as it sounds, given the plumbing and other attachments). This might be an option if you are uncertain of whether you want to own the land long term, do not want to commit to a stick-built home now, or cannot afford a stick-built home right now.

Although mobile homes are not easily moved once set up, they are easier to move than a stick-built home. Once a stick-built home is built, it is more or less there permanently (or at least until a natural disaster occurs or someone undertakes a demolition project).

An additional advantage mobile homes offer is that they are usually built in controlled environments. This means they can be consistently built to a high standard. And because they are manufactured in such conditions, construction delays due to weather or difficulty scheduling subcontractors are less likely.

Disadvantages of Buying a Mobile Home

A significant disadvantage of buying a mobile home is that its value will depreciate quickly. Like a new car, once a mobile home leaves the factory, it quickly drops in value. Stick-built homes, on the other hand, normally appreciate in value over time because the stick-built home owner almost always owns the underlying land. A person who owns both the land and the mobile home might see the value of the combined property increase over time, but that is likely the result of the underlying land increasing in value, not the mobile home.

One reason mobile homes depreciate in value is because they are considered personal property, not real property. "Real property" is defined as land and anything attached to it permanently. Anything that can be removed without "injury" to the land is not real property. Personal property, on the other hand, is anything that is movable and not classified as real property. Even though mobile homes are not easily removed from land once placed, they are still considered personal property (although in many locations a person who owns both the mobile home and underlying land can convert the mobile home to real property by taking some affirmative steps). On the other hand, stick-built homes are considered part of the real property.

A related disadvantage is that mobile homes, because they are personal property, are usually more expensive to obtain financing for. Personal property loans, sometimes called "chattel loans," usually come with higher interest rates and shorter terms than mortgage loans.

Additional disadvantages to mobile homes have to do with them typically being located in a mobile home park. Despite "owning" your actual home, you will still have a landlord, to whom you will have to pay rent and answer to for your compliance with park rules. Review these rules before signing anything; they will likely cover everything from trash policies to upkeep of your home exterior to permissible noise levels at different hours to pet policies. Understanding these rules will help you integrate into the community smoothly.

Yet another disadvantage is that the landlord might at some point decide to evict you, in which case you'll be faced with either moving or selling your mobile home.

Mobile homes are not easy to resell, especially when located in a mobile home park. Because they are relatively immobile after being set up, unless the buyer wants to keep the mobile home where it is, finding a buyer can be a challenge. It can cost several thousand dollars to move a mobile home. This might not be a disadvantage, though, if the mobile home and land are sold together, just like a stick-built house. However, despite significant advances in the quality of mobile home construction, there is still a stigma attached to mobile home ownership that could turn some buyers off.

A final disadvantage is that, unlike stick-built homes, which are built on permanent foundations, mobile homes are usually placed on temporary foundations. During a natural disaster, like an earthquake or severe storm, mobile homes can be more prone to damage.

To sum up, modern mobile homes can provide a quality, cost-effective alternative to a stick-built home. However, they have some disadvantages to stick built homes that you might need to consider. The multiple factors to weigh include costs, laws that impact mobile home value, and low cost stick-built alternatives vary from region to region, so be sure to do your research.