Trailer Treasure—Affordable Housing, Green Living, Community, Income in an Unlikely Place

The American dream of homeownership for all is not particularly healthy these days. Housing prices in some areas have already returned to pre-Great Recession (2006) levels. According to the Trulia real estate website, the median price for a home in San Francisco County is $583 per square foot! The cheapest price in California is $65 per square foot—up in Modoc County. Most housing in the United States falls between $50 and $150 per square foot.

Many of us find that we simply don't have (and can't borrow) the money needed to buy a stick-built home. Where does this leave us? Should we each have three jobs so we can afford our own place, or should we just give up and move under a bridge?

Interestingly, some of the richest people in the United States see this housing crisis as an opportunity. Warren Buffett owns one of the largest mobile home (MH) manufacturing companies in the United States and billionaire investor Sam Zell owns more than 370 mobile home parks (MHPs) nationwide. They just might be foreseeing an upcoming need for their services!

We think MHs are worth looking into, for several reasons:

1. They provide much-needed affordable housing.
2. They are environmentally friendly.
3. In MHPs, they provide the sense of community that many people crave.
4. For investors, they offer high returns for a low initial investment.

Something for everyone! But first, we have to get over the long-standing bad press.

Busting MH Myths

MHs and MHPs carry a stigma. The word poor comes to mind—poor-quality homes, poor people, poor surroundings.

The popular story is that MHs depreciate like a car, instead of appreciating like a house, and will soon turn to rust and dust. Yet we have seen and worked on 1960s mobiles that are holding up better than many of their stick-built counterparts. With minor upkeep, their metal undercarriage, siding, and roofing make them quite durable. As for their market value, many investors make a living buying and selling or renting out MHs; they must know something.

MHPs run the gamut, from high-end luxury communities to solid middle- and lower-income communities, to the scary MHPs, where drug dealers hang out on every corner and residents allow their MHs to slowly compost. But even the latter can be saved, as MHP turnaround experts and creators of the online Mobile Home University, Frank Rolf and Dave Reynolds, have demonstrated repeatedly. When you spend time in MHPs, you may find some of the expected “poorness,” but you may also find neighbors who know each other, kids who can play safely on the streets, and people who make time to beautify their home and yard.

Getting Oriented to the MH World

There are many types of MH, with major differences based on age and size. Homes are available from single- to triple-wide, and from 40 to 90 feet long. Age differences show up as stylistic changes, such as aluminum siding and roofing and no roof overhangs on older homes, and wooden siding, pitched roofs, composition shingles, and deep overhangs on newer ones.

Merriam-Webster defines mobile home as “a house that is built in a factory and then moved to the place where people will live in it.” You may also hear the terms manufactured home and modular home, the distinctions being based on when the home was built, which codes it meets, and whether the chassis is permanently attached or removed after delivery. But unless you’re buying a new manufactured/modular/mobile home, these distinctions will have little impact on buying, renovating, living in, or selling an existing one.

What does matter is where your MH is located. MH locations come in two basic flavors: on land and in parks, each with its pros and cons.

MHs on land give you many of the same freedoms and responsibilities as stick-built homes, but at a much lower price. You may find an MH on a several-acre parcel, on a small lot in a subdivision created for MHs, or even within the rare MHPs that allow homeowners to own their tiny lot while enjoying the benefits of shared facilities. One big advantage of an MH on land is that you’re free to rent it out if you choose.

MHs in parks are different. Roughly half of the 8.6 million MHs in the United States are in parks, and you pay space rent to keep your home there. Park rules may restrict the age of the renter, the age of the MH, its rentability, its appearance, and what you can do around your home. An MH in a park has several advantages:

1. You don’t have to buy the land.
2. The infrastructure is in place and is maintained by the park.
3. You have a built-in social structure.
4. Used MHs in parks can be really inexpensive.

MHs as Affordable Housing

Just how affordable are MHs? While you can pay $40,000–$250,000 or more for a big, new, manufactured home, we think the real story is in the smaller, older homes. If you know where to look, you can find livable older MHs for $5 per square foot or less—even free! Those prices don’t usually include the land, so it's not an apples-to-apples comparison with stick-built homes. But even some smaller and older MHs on land are offered for $40 per square foot or less.

Where do you find these deals? Sometimes you’ll find them on a multiple listing service, particularly for MHs on land. But the bargains in parks take a little more looking. Check craigslist.com, but this is the Wild West, and you need to do your due diligence. Drive through an MHP and look for For Sale signs in the windows. Get to know the park managers and ask if they’ll be “taking back” any homes soon. This can occur when a homeowner doesn’t pay space rent for several months, and the park owner may auction off the MH to cover lost rent.

Then there are the free homes. Sometimes MH owners die or need to move on, and they or their heirs just want to be rid of the home to avoid paying space rent. These folks will happily give up the MH for little or nothing. Once you own an MH in a park, you may be in a good position to hear about such deals.

MHs as Environmentally Friendly Housing

Tiny houses are all the rage these days. But if you look back a decade or two, you’ll find that MHs were the tiny houses of yesteryear. The smaller the house, the less impact it has on the environment: less material used in construction, less energy required to heat and cool the space, and less land taken up by the home’s footprint.

Mobile homes, especially the older ones, are almost always smaller than stick-built homes. The average new house in the United States has a floor area of 2,400 square feet, while the average MH is just over 1,100 square feet. A one-story stick-built house weighs about 200 lb per square foot, 4 times as much as the average MH. There’s a lot less embodied energy in a 55,000 lb mobile than there is in a 480,000 lb stick-built house! Furthermore, the 2,400 ft² home will have about double the surface area from which to lose or gain heat.

Yes, MHs tend to have thinner walls and less insulation than stick-built homes (though newer mobiles are generally better insulated). But it’s not hard to improve the energy efficiency of older MHs. Air sealing the building envelope and replacing leaky single-pane windows is pretty easy. With a little more work, roof insulation can be increased, and there are even ways to improve wall insulation.

In our own mobile homes, we’ve both taken a phased approach, making energy improvements as rental income allows. For example, in Carol’s rentals (see “Case Studies”), the low-hanging fruit included air sealing, replacing leaky single-pane windows with double-pane, low-e windows, swapping out old incandescent lights for CFLs, switching to motion-sensitive porch lights with photosensors, adding a rheostat on the furnace fan control to run it with less motor power, and showing tenants how to use heating and cooling systems for maximum comfort with reduced energy consumption. Future projects will include increased roof, wall, and floor insulation and more effective summer shading.

MHPs as (Un)Intentional Community

In recent decades, there’s been a lot of talk about our desire for community. Many suburban and urban living environments lack features that draw neighbors together. As a result, there’s been a focus on intentional community, new urbanism, and cohousing (private homes clustered around shared space).

Meanwhile, MHPs have been quietly providing a sense of community for their residents all along. In parks, MHs tend to be placed fairly close together on relatively narrow streets. People are often out on the street chatting, helping each other out, doing wheelies, and trading gossip. The eyes-on-the-street phenomenon makes for a safer neighborhood.

In addition, there is usually a clubhouse with a kitchen, available for residents to gather and share meals on special occasions. Most parks also have shared recreation facilities, which may include a swimming pool, a barbeque area and picnic tables, a playground, walking trails, and/or shuffleboard and horseshoe courts.

Carol owns two MHs in an MHP and has been amazed at how quickly she got to know the neighbors. In fact, people dropped by to chat so frequently that it was almost hard to focus on the rehabbing work at hand! Carol kept asking herself, “What does this remind me of?” And it finally hit her: It’s like a college dorm, where you can always find someone to talk to by wandering down the hall—except that an MHP is a bit more grown up.

MHs as an Investment

The big surprise is that MHs aren’t just affordable homes. They can also be a good investment. If you have four to five figures to invest, you can own your investment home outright—and make an annual ROI (return on investment) of 20–50% by renting it out. This compares favorably to a good year in the stock market, which might net 5–7% at best. As a rental, an MH might pay for itself in two to five years, and the rest is gravy. (See “Case Studies” for some examples of how this is done.)

There’s also a breed of investors who buy and resell MHs, with or without rehabbing. They often carry the loan for the buyer, making their money on the interest. In either case, investors are providing a much-needed service—affordable housing—while making good money. That’s called a win-win.

One big factor in MH investing is whether you own the land on which the MH sits. Many MHPs don’t allow subleasing (renting out your MH), which leaves the investor with a few options: buying MHs on land, searching for the few parks that allow subleasing, or reselling rather than renting.

Downsides

Admittedly, there are challenges to owning an MH. There is that nagging perception of “poorness” and depreciation. People who invest in MHs may be seen as the poor stepchildren of “real” investors. When buying in a park, you don’t have the level of control you usually have when purchasing a home on land, and the park owner and manager can play a big role in your life.

There are also some problems with MH construction. Windows are commonly stuck to the outside, with nothing more than putty between the siding and the window fins. There is often little or no flashing, so water can enter at seams, around windows, and at the base of walls (roof overhangs can partially overcome this defect).

Newer mobiles look more like stick-built homes, but they have their own shortcomings, such as particleboard for flooring and siding. The waterproof layer behind that fake wood grain siding is actually glued to and part of the siding, so there is no way to lap it to shed water. Much of the plumbing and electrical hardware is flimsier than you’d find in stick-built construction.

Knowing these things can help prevent unhappy surprises. If you’re going to own an MH, you want to know where the nearest MH parts suppliers are.

MHP Dreaming

So far, we’ve been talking mostly about individual MHs. But let’s think a bit bigger: How about buying an entire MHP? Controlling the whole park allows for some interesting possibilities.

Imagine getting a bulk discount on paint and teaching residents how to paint their own MHs, then organizing help-each-other-out painting parties, increasing pride of ownership while improving the appearance of the whole park. The same concept could be applied to weatherization and energy efficiency improvements. Imagine teaching and encouraging residents to collectively compost their food waste, grow their own food, harvest and direct rainwater, and even tend chickens.

Or how about a group of artists getting together to buy a really cheap, nearly abandoned MHP in an area that just lost its main industry (we’ve seen such deals) and creating their own art colony, with shared studio spaces and tools? Or maybe Baby Boomers, who are notorious for not having set aside much for retirement, could take over an MHP to provide themselves with affordable housing, while jointly acquiring exercise equipment, wellness care services, and brain-refreshing classes and activities.

Once we get past the myths, MHs and MHPs hold a lot of promise for improving people’s lives and helping us to live a little lighter on the land.

Larry Weingarten was raised on the Monterey Peninsula of California and has been self-employed most of his working life. He got his general contractor's license in 1982. Larry has written articles on water heating and energy for various trade journals. He has taught about these topics for PG&E, California State Parks, Affordable Comfort, and others. More recently he has helped create DVDs on these and related topics. He finished building an off-grid home in 2006. Designed to be very efficient, comfortable and inexpensive, it was the 13th home to meet the "1000 Home Challenge," a competition for creating superefficient homes. For over 35 years, Larry has been involved in rehabbing rental properties for fun, profit, and the adrenalin rush.

Carol Venolia is an architect and founder of “Come Home to Nature”. She has designed eco-homes, schools, healing centers, and eco-villages; penned the “Design for Life” column in Natural Home Magazine for 9 years; wrote the books Get Back to Nature Without Leaving Home, Natural Remodeling for the Not-So-Green House, and Healing Environments: Your Guide to Indoor Well-Being; and acted as project manager and editor for the latest edition of Home Energy magazine’s book No-Regrets Remodeling. Carol has been honored by The Green Economy Post as one of ten pioneering women in green design and was named a Green Design Trailblazer by Natural Home Magazine. She currently rehabs stick-built and mobile homes for fun and profit.

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