A Growing Real Estate Opportunity

Manufactured housing communities, or MHCs, where most manufactured homes are installed, offer residents friendly neighborhoods, common areas, and a range of attractive on-site amenities. Residents of MHCs pay monthly rent for the site and are responsible for maintenance and costs associated with the manufactured home itself. Owners of MHCs have relatively low operating expenses limited to capital expenses on the site pads, the common areas, and community infrastructure.

Nearly 96% of all MHCs are owned and operated by individuals, resulting in significant opportunity for institutions to implement economies of scale and operation improvements that drive returns for investors. Additionally, the average monthly MHC site rents cost a fraction of apartment rents. In 2023, the monthly cost to rent a site in an MHC averaged $679 compared to $1,709 for a single bedroom apartment.1

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An Attainable Housing Solution

Manufactured housing offers one of the largest sources of cost-effective housing in the United States, providing shelter to 21.2 million Americans with a median household income of $35,000 per year.2

For Americans interested in purchasing a home, manufactured housing is one of the most reasonable homeownership options available. In fact, manufactured housing costs nearly 50% less than a traditional site-built home.3

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$ 0
AVG. COST FOR A MANUFACTURED HOUSE IN 2023
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$ 0
AVG. COST PER SQ. FT. FOR A MANUFACTURED HOUSE IN 2023
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$ 0 +
AVG. COST FOR A SITE-BUILT HOME, EXCLUDING LAND COSTS
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$ 0
AVG. COST PER SQ. FT. FOR A TRADITIONAL HOUSE

As of 7/30/2024

SECTOR PERFORMANCE

IAS-MHC-Sector-Performance-Chart

As of March 1, 2024, Green Street Advisors’ Commercial Property Return Index reported manufactured housing returns at nearly 275%, since February 2014.

Notable Sector Performance Across Economic Cycles

Historically, the manufactured housing sector has performed well during both recessions and economic upswings. This is primarily due to the consistent higher returns and relatively low volatility as compared to other leading real estate sectors, such as multifamily, industrial, and retail.

While past performance is not a guarantee of future results, the fundamentals of commercial real estate going into 2020 were strong. 

Why the Manufactured Housing Sector Remains a Promising Real Estate Strategy

The commercial real estate market is vast and varied, with manufactured housing emerging as a standout sector. This sector, once overlooked, is now capturing attention due to changing housing dynamics. Financial professionals and investors may benefit from staying informed about this burgeoning corner of commercial real estate.

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December 14, 2023

Why the Manufactured Housing Sector Remains a Promising Real Estate Strategy

Manufactured Housing

The commercial real estate market is vast and varied, with manufactured housing emerging as a standout sector [..] READ MORE

Limited Supply with Growing Demand

With rising housing costs, many Americans are looking for alternative housing options, especially Baby Boomers who are wanting to retire and downsize on a fixed income. The increasing demand for affordable housing options and a growing retiree population present a unique opportunity for the manufactured housing sector to grow rents and increase occupancy.

Resident retention is very strong at MHCs – staying on average 14 years. Why? The cost to relocate a manufactured home from one location to another can cost upward of $14,000 depending on size, distance, weight, etc.8

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0 .4%

of the nation’s total housing are MHCs4

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0

when all baby boomers expected to be 65+5

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new MHCs constructed
since 20026

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average number of years residents stay in MHCs7

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MHCs Nationwide 2

0 %

Owned by Individuals

A Powerful Part of Your Investment Strategy

Manufactured housing is a vital part of the housing market and could offer investors capital appreciation and a steady income stream. Enhancements in the quality of manufactured housing, the neighborhood feel offered by MHCs and the increased interest in the sector by institutional players could unlock the potential for utilizing manufacturing housing as a powerful part of an investment strategy.

Institutional investment activity in MHCs surged throughout 2021 as investors placed capital in operationally resilient sectors with favorable return profiles.

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Inland’s Manufactured Housing Resource Center

Affordable Home Ownership Through Manufactured Housing

Manufactured Housing Comes of Age as a Unique Housing Solution

This once overlooked segment of the housing market has moved far beyond the “trailer park” reputation of the 1960s to emerge as one of the most compelling housing options for both millennials and retirees.

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Ravi Bansal discusses the success of the manufactured housing and the factors continuing to drive sector demand in 2023...

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1 Statista. Average monthly rent for manufactured housing in the United States from 2010 to 2023; Yardi Matrix. Multifamily Rent Decline Continues in December, Reports Yardi Matrix, January 2024.

2 Manufactured Housing Institute. 2023 Manufactured Housing Facts, Industry Overview. June 2023.

3 U.S. Census Bureau. Cost & Size Comparison New Manufactured Homes and New Single-family Site-Built Homes.

4 Manufactured Housing Institute. Affordable Housing Solution: Manufactured Homes. February 2023.

5 US Census Bureau. By 2023, All Baby Boomers Will Be Age 65 or Older. December 2019.

6 MH Insider. New communities Slow to Rise on Manufactured Housing Landscape. December 2019.

7 Forbes. Why Manufactured Housing Is A Strong Foundation for Investment. December 2020.

8 Moving.com. The Cost of Moving a Mobile Home in 2023 – What You Can Expect to Pay.

9 Wells Fargo. 2022 Manufactured Home Community Market Update and Financing Handbook.

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