A new federal rule proposed by the Biden Administration requires better built manufactured housing, a prudent change in the context of typical tenure, housing shortages and increasing climate-driven risks.
The desire to own a home, for many in the United States, is like watching a galaxy at the far end of the Milky Way through a telescope. Each day it shrinks a little farther out of sight. Mobile homes, as they are sometimes called, have been one of the last affordable options to out-of-control rents, which rose by 20% over the last year alone.
We have initiated conversations several times over the years urging the mobile home industry to improve performance voluntarily, but have mostly been met with a shrug. Why change, the thinking goes, if it will only increase up-front costs, and our customers are not clamoring for energy efficiency?
The housing market, however, needs more affordable options that are also well built. To that end, the costs, the risks and the benefits support the proposed new rule for manufactured housing.
According to The Washington Post :
In the most recent residential energy consumption survey by the U.S. Energy Information Administration in 2015, mobile home residents were more likely than single-family home residents to report having too many drafts in the winter and single-pane (versus double or triple pane) windows. And mobile homes consumed about 35 percent more energy per square foot than detached single-family homes.
Because of their smaller typical size, lower mortgages, lower taxes and other details, however, conventional mobile homes currently save homeowners about 40% in total annually, compared to site-built homes.
Proposed code changes for manufactured homes initiated with a 2017 lawsuit by the Sierra Club, resulting in a court order, where the DOE has to finalize a new, stricter construction rule by May 16 of this year
The Post reports:
While the DOE proposal considers various alternatives to the rule, it features a two-tiered strategy in which manufactured houses with a sales price of under $63,000 are subject to less stringent requirements. The department designed the lower level — Tier 1 — so that energy-efficiency improvements don’t raise the cost of a home by more than about $750, on average. It estimates that Tier 2 would increase the price of a home by about $3,900 to $5,300, depending on its size.
According to ACEEE , residents of manufactured homes typically spend $1,750 on energy each year . A quarter of residents of manufactured homes have severe energy burdens, meaning they spend more than 10% of their income on energy costs.
ACEEE believes that this rule “would save $1,727 over 30 years (net of costs); residents of multi-section homes would save $2,511 over 30 years.” They add, however, that the proposed rule change could have been more effective: “DOE seemingly limited the scope to improving the efficiency of building components that were covered in a 2016 proposal, thus missing significant energy savings that are in the 2021 model energy code for site-built homes (which by law must be the starting point for this standard).”
Tenure Matters
These proposed upgrades are designed so that a homeowner could pay for the additional energy upgrades in energy savings over 3.5 to 11 years.
An important question, then, is how many people stay in their mobile homes for a decade or more? That figure is currently about 56%, according to this analysis . That means that even at the highest additional upgrade cost, more than half of people could see added financial benefits from energy savings over the long haul. And this was the case before the Pandemic blew housing prices through the economic roof.
Of course, not everyone is satisfied with the new rules. Manufacturers fear they’ll lose sales as prices for new mobile homes exceed the bandwidth of people making as little as $14,500 a year. Energy efficiency advocates say the two-tier system is ill conceived, and could end up sending the lowest quality housing to the people with the least disposable income to pay for utilities.
The Housing Crush
It’s no secret that housing inventories have hit record lows. Housing prices have risen by double digits during the pandemic, and the triple forces of labor shortages, supply line interruptions and the pandemic have thrown obstacle after obstacle into a rapid housing recovery.
Manufactured homes offer a narrow window of opportunity to become a homeowner for many people who haven’t benefited from the pandemic’s consolidation of upper level wealth.
Were rents to stay flat, mobile homes might not see such fast-growing interest. Surveys show that nearly 80 percent of renters believe renting is cheaper than owning a home.
On sheer face value, discounting home equity, that might be true in some regions, in some neighborhoods. A renter doesn’t have to replace a leaking roof or failed heating system. But when you raise rent from $1500 a month to $1900 a month in one year, as has become commonplace over the last year, that perceived value equation may no longer apply. Mobile homes begin to look like the last, best hope for an affordable living situation in some places.
Climate Change Realities
An argument for better built mobile homes must include the rising risks from extreme weather, heat and wildfire. About 18 million Americans live in mobile homes, and the number is growing.
We know that mobile homes tend to perform poorly in tornadoes. About 39 percent of tornado fatalities each year involve manufactured housing. But what about hurricanes and lesser storms?
The industry asserts that mobile homes can handle hurricane force winds as well as site built homes. Field reports tend to support this assertion, but with one caveat: age.
Mobile homes built after 1994 federal code changes have done pretty well in hurricane events. But older mobile homes have no such strength. Not only was the old building standard inferior, these older homes tend to have weaker connection points, corrosion and so on. The nation’s 225 or so mobile home parks have far too many old homes still in use, in the face of a growing number of monster storms.
One of the advantages of the new federal rules may be to call attention to these older properties, and offer the first major upgrade to the Federal rules since 1994. One of the key motivators for the Biden administration is their effort to increase the stock of housing that’s affordable to relatively low income earners.
Rather than simply shuffling people into inferior housing stock, the thinking is that mobile homes should offer relief from high utility bills as well as a buffer from financial distress. In return, single-family mortgages for manufactured homes will, according to the administration, become more easily available.
The rule will be open for public discussion later this month.
Veteran journalist Matt Power has reported on innovation and sustainability in housing for nearly three decades. An award-winning writer, editor, and filmmaker, he has a long history of asking hard questions and adding depth and context as he unfolds complex issues.
Stricter Mobile Home Standard Should Be Decided by Math
A new federal rule proposed by the Biden Administration requires better built manufactured housing, a prudent change in the context of typical tenure, housing shortages and increasing climate-driven risks.
The desire to own a home, for many in the United States, is like watching a galaxy at the far end of the Milky Way through a telescope. Each day it shrinks a little farther out of sight. Mobile homes, as they are sometimes called, have been one of the last affordable options to out-of-control rents, which rose by 20% over the last year alone.
We have initiated conversations several times over the years urging the mobile home industry to improve performance voluntarily, but have mostly been met with a shrug. Why change, the thinking goes, if it will only increase up-front costs, and our customers are not clamoring for energy efficiency?
"Royal Mobile Home Park" by cityoflongmontco is licensed under CC BY-NC 2.0
The housing market, however, needs more affordable options that are also well built. To that end, the costs, the risks and the benefits support the proposed new rule for manufactured housing.
According to The Washington Post :
In the most recent residential energy consumption survey by the U.S. Energy Information Administration in 2015, mobile home residents were more likely than single-family home residents to report having too many drafts in the winter and single-pane (versus double or triple pane) windows. And mobile homes consumed about 35 percent more energy per square foot than detached single-family homes.
Because of their smaller typical size, lower mortgages, lower taxes and other details, however, conventional mobile homes currently save homeowners about 40% in total annually, compared to site-built homes.
Proposed code changes for manufactured homes initiated with a 2017 lawsuit by the Sierra Club, resulting in a court order, where the DOE has to finalize a new, stricter construction rule by May 16 of this year
The Post reports:
While the DOE proposal considers various alternatives to the rule, it features a two-tiered strategy in which manufactured houses with a sales price of under $63,000 are subject to less stringent requirements. The department designed the lower level — Tier 1 — so that energy-efficiency improvements don’t raise the cost of a home by more than about $750, on average. It estimates that Tier 2 would increase the price of a home by about $3,900 to $5,300, depending on its size.
According to ACEEE , residents of manufactured homes typically spend $1,750 on energy each year . A quarter of residents of manufactured homes have severe energy burdens, meaning they spend more than 10% of their income on energy costs.
ACEEE believes that this rule “would save $1,727 over 30 years (net of costs); residents of multi-section homes would save $2,511 over 30 years.” They add, however, that the proposed rule change could have been more effective: “DOE seemingly limited the scope to improving the efficiency of building components that were covered in a 2016 proposal, thus missing significant energy savings that are in the 2021 model energy code for site-built homes (which by law must be the starting point for this standard).”
Tenure Matters
These proposed upgrades are designed so that a homeowner could pay for the additional energy upgrades in energy savings over 3.5 to 11 years.
An important question, then, is how many people stay in their mobile homes for a decade or more? That figure is currently about 56%, according to this analysis . That means that even at the highest additional upgrade cost, more than half of people could see added financial benefits from energy savings over the long haul. And this was the case before the Pandemic blew housing prices through the economic roof.
Of course, not everyone is satisfied with the new rules. Manufacturers fear they’ll lose sales as prices for new mobile homes exceed the bandwidth of people making as little as $14,500 a year. Energy efficiency advocates say the two-tier system is ill conceived, and could end up sending the lowest quality housing to the people with the least disposable income to pay for utilities.
The Housing Crush
It’s no secret that housing inventories have hit record lows. Housing prices have risen by double digits during the pandemic, and the triple forces of labor shortages, supply line interruptions and the pandemic have thrown obstacle after obstacle into a rapid housing recovery.
Manufactured homes offer a narrow window of opportunity to become a homeowner for many people who haven’t benefited from the pandemic’s consolidation of upper level wealth.
Were rents to stay flat, mobile homes might not see such fast-growing interest. Surveys show that nearly 80 percent of renters believe renting is cheaper than owning a home.
On sheer face value, discounting home equity, that might be true in some regions, in some neighborhoods. A renter doesn’t have to replace a leaking roof or failed heating system. But when you raise rent from $1500 a month to $1900 a month in one year, as has become commonplace over the last year, that perceived value equation may no longer apply. Mobile homes begin to look like the last, best hope for an affordable living situation in some places.
Climate Change Realities
An argument for better built mobile homes must include the rising risks from extreme weather, heat and wildfire. About 18 million Americans live in mobile homes, and the number is growing.
We know that mobile homes tend to perform poorly in tornadoes. About 39 percent of tornado fatalities each year involve manufactured housing. But what about hurricanes and lesser storms?
The industry asserts that mobile homes can handle hurricane force winds as well as site built homes. Field reports tend to support this assertion, but with one caveat: age.
Mobile homes built after 1994 federal code changes have done pretty well in hurricane events. But older mobile homes have no such strength. Not only was the old building standard inferior, these older homes tend to have weaker connection points, corrosion and so on. The nation’s 225 or so mobile home parks have far too many old homes still in use, in the face of a growing number of monster storms.
One of the advantages of the new federal rules may be to call attention to these older properties, and offer the first major upgrade to the Federal rules since 1994. One of the key motivators for the Biden administration is their effort to increase the stock of housing that’s affordable to relatively low income earners.
Rather than simply shuffling people into inferior housing stock, the thinking is that mobile homes should offer relief from high utility bills as well as a buffer from financial distress. In return, single-family mortgages for manufactured homes will, according to the administration, become more easily available.
The rule will be open for public discussion later this month.
By Matt Power, Editor-In-Chief
Veteran journalist Matt Power has reported on innovation and sustainability in housing for nearly three decades. An award-winning writer, editor, and filmmaker, he has a long history of asking hard questions and adding depth and context as he unfolds complex issues.