You are probably constantly searching for a great deal on a property if you are a Bixby rental property investor. You might be wondering whether manufactured homes are a wise financial decision. It can appear to be the best choice for your next rental property at first glance. Manufactured homes are popular in numerous regions of the United States. But before choosing a manufactured house as your next investment property, you need to weigh a number of benefits and drawbacks.
Oftentimes, manufactured homes are more affordable than other types of single-family homes and this is one of the greatest advantages. The way manufactured homes are constructed and installed can result in a significantly lower cost per square foot than other types of properties, even those that are similar in size and age. Furthermore, a new manufactured home will probably be much more affordable for you as an investor than new construction, which may be out of your price range. In many cases, the construction time is cut in half compared to conventional houses. This means that you could purchase and rent out a brand-new home for roughly the same price as a fixer-upper that would take months to prepare for a tenant.
Quality and environmentally friendly design are additional advantages of purchasing manufactured homes. Today’s manufactured homes typically match or exceed the quality of conventionally-built homes, in contrast to previous decades. You have a better chance of getting a manufactured home that is structurally sound, attractively constructed, and energy efficient because of the strict factory standards for manufactured homes. The majority include upgraded insulation beneath the foundation and within the walls. In addition, they provide energy-efficient windows, on-demand water heaters, and other appliances and fixtures that conserve energy. All of these environmentally friendly elements can lower utility and maintenance costs.
However, investing in manufactured homes has some disadvantages. Finding a good place to build a manufactured home is one of the biggest challenges in purchasing one to use as a rental. Although the price of the home may be relatively low, the price of the land must also be considered. Especially in urban or suburban areas, the cost, zoning, and availability of land may present insurmountable obstacles.
This problem might be solved by locating and purchasing an existing manufactured home, but this also raises a second typical drawback of prefabricated homes: long-term value. There is disagreement over whether manufactured homes will appreciate enough to be worthwhile investments as rental properties. Some places may severely restrict the future value of manufactured homes due to an ongoing stigma.
Finally, a manufactured home may be more difficult to finance than other types of real estate. Manufactured homes are not commonly regarded as “real property” by mortgage lenders. Some lenders might decline to give you a loan large enough to pay for the land and the home itself because they feel that a manufactured home is temporary. Despite the fact that this objection might eventually be overcome, it adds to the challenges facing investors in rental properties. Are manufactured homes a wise investment, then? The most appropriate response is that they potentially could be, subject to factors like quality, location, and financing availability.
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