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MortgagePoint » Your Trusted Source for Mortgage Banking and Servicing News 44 July 2024 F E A T U R E S T O R Y EXPLORING OPPORTUNITIES IN MANUFACTURED HOUSING Dave Howard of ServiceLink explains how manufactured housing presents added options for the next generation of homeowners in today's marketplace. B y DAV E H O WA R D T he popularity of manufactured housing has ebbed and flowed over the last several decades, after striking an all-time high on shipments in the early 1970s. Since taking a dip in 2009, there has been a slow, but steady climb with more than 100,000 manufactured homes shipped in 2021, and a post-recession high reached in 2022 with 112,000 manufactured homes shipped, ac- cording to a 2023 report by the Joint Center for Housing Studies at Harvard University. Today, there is a greater emphasis be- ing placed on manufactured homes—both for borrower and lender—as a means for entry-level housing that can help address the steep inventory shortage nationwide. With the addition of new amenities, upgraded finishes and improved quality of aesthetics and construction, in some cases it is hard to tell the difference between a manufactured home and site-built home. Regulations went into effect in 1976 that require new manufactured homes to meet federal standards defined by the U.S. Department of Housing & Urban Development (HUD). Over the last several years, these homes have become even more modernized. For potential buyers in the Gen Z and millennials age groups—born between 1981 and 2012—these newly built, visually appealing homes provide another option to become a homeowner at a price they may be able to better afford. Based on ServiceLink's 2024 State of Homebuying Report (SOHBR), these younger generations are ready to take that first step to becoming a homeowner, with 63% of Gen Z, and 59% of millenni- als, surveyed saying they plan to buy this year. And while they have their eyes set on the prize, high housing costs and low availability could curtail their dreams. Of those surveyed—who either purchased or attempted to purchase a home in the last four years—79% of Gen Z and 71% of millennials reported less than $100,000 in annual household income. This is where manufactured housing becomes another avenue that could lead them to the finish line. With lower costs, shorter build times and all the modern amenities they now offer, Gen Z and mil- lennials are giving them a look. A Freddie Mac survey indicated that 68% of millenni- als and 61% of Gen Z (along with 62% of Gen X) respondents said they are likely to consider buying a manufactured home. For lenders, this opens up an added market to potentially increase revenue during a trying time. The Cost Advantage for Buyers I n this volatile market, the cost to pur- chase a home remains high. In April, the National Association of Realtors (NAR) re- ported a median sale price of $393,500, up 4.8% year over year. For a new build, that cost is even higher, coming in at a median sale price of $430,700 in March, accord- ing to the U.S. Census Bureau. A perk of purchasing a manufactured home is the lower-level cost, which the Manufactured Housing Institute reports as $85 per square foot, versus $167.87 per square foot for a site-built home. Manufactured homes can be produced for less, as they're built in a factory where the process is streamlined and more efficient. A benefit of purchasing a manufactured home is the lower-level cost, which the Manufactured Housing Institute (MHI) reports as $85 per square foot, versus $167.87 per square foot for a site-built home. Manufactured homes can be produced for less, as they are built in a factory where the process is streamlined and more efficient. Gen Z and millennials who are look- ing for a starter home with all the bells and whistles—often with lower incomes, D A V E H O W A R D is EVP of Origination Services at ServiceLink, responsible for developing and executing broad go-to-market strategies for new customer acquisition and existing client retention and growth. Howard has had a variety of applicable experiences to draw on, having spent time as a software developer, developing and implementing human resources strategies, running product sales teams, and sales & marketing operations functions for domestic and international business lines at top fintech companies. He holds a bachelor's degree and MBA from the University of Wisconsin-Milwaukee and serves as Vice Chair of the Board for Communities in Schools of Pittsburgh- Allegheny County.