News & Notes Archive - February 2005
New Consumers Union study finds big fluctuations in costs of identical mobile homes
In a report released January 27, 2005, Consumers Union said that prices on identical home models vary significantly and that those shoppers who end up paying the highest prices are first time home buyers, consumers who shop at three or fewer dealerships, and buyers who finance their home directly through a dealer.
One example sited: a purchaser in Dallas County, Texas paid $42,000 for a newly constructed “Alamo by Clayton,” 16 x 76 single-wide home, while in Franklyn County, a two hour drive to the east, that same make and model sold for $33,800. That’s a whopping $8,200 difference.
CU’s news release said the traditional manufactured home dealer sales process is based on secrecy and uncertainty surround the value of each home. “That’s not good for consumers, says Suzanne Henry, a policy associate with CU's Manufactured Housing Project. “If you overpay for your house or its financing, often you’ll be left owing more on the loan than the home is worth. This raises the likelihood of the foreclosure and repossession of your home.“
The report concludes the good news is the MH can remedy this by adapting the use of sticker prices and the use of independent home appraisers from the conventional real estate market. Consumers can help themselves by shopping for their loan separate from their home purchase.
Amen, to that. And kudos to CU for another important revelation.
Figures released for total homes built in 2004—What it means for MH buyers
The Arlington, Virginia-based Manufactured Housing Institute(MHI), the industry’s principal trade group, announced that the total number of manufactured homes built in 2004 was 130,802. That compares with 130,397 for 2003. Actually, if the federal government (in this case FEMA) had not ordered close to 6,000 homes to replace those lost in the Florida hurricanes, the total for 2004 would have been around 124,000.
Those MH builders (almost all in the Southeast) who were on the receiving end of FEMA’s largesse had ample reason to believe “It’s an ill wind that blows no good.”
These figures indicate the MH industry has not fully recovered from the boom-and-bust years of the 1990s (at one point, 1997, the annual production total was 353,000). For MH shoppers, the good news is the estimated 65% contraction of the industry has also squeezed out almost all the sleazeball, fly-by-night operators who at one point swarmed the MH industry like piranha fish around a capsized cattle barge.