MANUFACTURED HOUSING IS SO YESTERDAY

They average about half the cost of a regular house, yet "manufactured housing" -- called mobile homes or trailers in the 1970s -- is on the downswing amid the downturn. 

Single Wide Manufactured Home

According to MHI, a trade group representing the factory-built-housing industry, in 2003, there were 130,937 units sold; in 2010, only 50,046 units were sold. Thayer Long, president of MHI, however, said manufactured housing as a percentage of new single-family houses is up slightly from 11.7% in 2009 to 13.5% in 2010.

Andy Gallagher, executive director of West Virginia Housing Institute, blames a lack of industrywide marketing. "MHI went through a big discussion recently, but the manufacturers defeated the proposal because they believed it would drive up the prices," he said. "We need to attract political leaders, get them into the lots, help them understand that our industry is not about the old tinny mobile homes of the '70s but about spacious and affordable living." 

One problem has been that with falling prices on site-built homes, the perceived price gap is lessening. According to Mr. Long, in 2009, manufactured homes were available at $41 a square foot and site-built homes at $83 a square foot. 

Who's buying? Mr. Long said the industry has a specific market with which it is very popular.

"We have the 55-years-and-older market, the retiree market. We've also done well on the entry-level market and particularly the rural market. Then there are the millennials -- these people are coming into home-buying age [25 to 34] and are more discerning and educated consumers" who look to buy rather than rent.

Some manufacturers have targeted other demographics and seem to have bucked the trend. Joe Stegmayer, president-CEO of Cavco Industries, a Phoenix-based marketer, reported a $1.6 million profit last quarter.  Cavco, through their Fleetwood Homes division, recently purchased Palm Harbor Homes, a manufactured housing company and its real modular home division, Nationwide Homes.

"We made an effort to reduce overheads, increase market shares and have also been doing some heavy marketing," said Mr. Stegmayer. "With our advertising, we've tried to go for a number of different niches rather than universal campaigns. We're trying to address the immigrant population, the baby boomers, the echo boomers. The echo boomers are potential first-time home buyers ... we want them to know they can have a place of their own."

IS GOING GREEN A TOUGH SELL TO NEW HOME OWNERS?

Green costs more, and today's already-skittish potential home buyers are not willing to shell out more cash for a greener standard of living.

"I believe that buyers appreciate 'green' features, but they are not yet ready to pay extra for them," Bob Parris, broker/owner of Manchester Realty in the Chicago area.

There is no question that Americans are more aware of and more receptive to the green movement than ever before, but green home features are still extremely costly, and while some can, over time, lower energy costs, it's often over a long period of time, and to many, not worth the up front cash right now.

I know of several modular home factories that have Energy Star programs in place with everything from design to final home rating and everything in between but even here the new home buyer is starting to question why they need to spend thousands of dollars to save a couple of hundred a year, knowing that they might not be in the house long enough to see any rewards or savings.

There are a lot of products used in homes today that are more energy efficient right out of the box than there ever has been before and some of these are now standard features with modular home factories, like windows, doors, insulation and roofing.

Will the new home buyer embrace eco-friendly homes if the price is too high?  I doubt it.

EXTREME MAKEOVER UPDATE

I saw this article on the Fayette Observer's blog and thought I would share it with my readers.  Blue Ridge Log Cabins, the factory that provided the modular home, is really promoting it and doing a great job.

Blue Ridge Log Cabins has kindly put up an online video stream so you can watch the house be built from the comfort of home. Blue Ridge, who is based in South Carolina, specializes in log cabin modular homes, so the pieces are being brought to the Langdon Street site now. Go here to watch this architectural feat happen. Remember, this whole thing must be done by Thursday!

Brian Dukes, who has been at the site today, says the camera normally has been in the VIP tent, but it's brought out tonight so we can watch the house being put down on the foundation. Pretty nifty, huh? Let's hope that the camera stays outside. No offense, VIPs, but we want to see some action!

MICHELLE OBAMA TO ATTEND EXTREME MAKEOVER HOUSE

First lady Michelle Obama is expected to be in Fayetteville, NC, the home of Fort Bragg and Pope AFB, on Thursday to be part of the "Extreme Makeover: Home Edition" episode.

The ABC reality series has been in Fayetteville since last week filming the construction of a home for Barbara Marshall, a 15-year Navy veteran who is working to end homelessness among female veterans. Marshall created The Steps-N-Stages Jubilee House which provides homeless female veterans with housing and support services.  The home is a modular log home built by Blue Ridge Log Cabins.  This is a real modular log home unlike other factories that build a standard modular home and cover it with split lag siding.  It will be awesome!

Obama's visit will be closed to the media, according to a news release. The episode featuring Marshall and the First Lady will air in October.

Construction workers and volunteers have been working around the clock since July 14 to build a second-story home for Marshall and the women she helps at the Jubilee House.