116 3rd St SE
Cedar Rapids, Iowa 52401
Manufactured home sales see slow recovering
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Aug. 2, 2013 4:30 pm
When it comes to the recovery of the housing market, there's one segment that can sometimes fly under the radar- mobile, or manufactured, homes.
The industry took a big recessionary hit in 2009, when manufactured housing shipments fell to 49,717 from a height of 95,752 in 2007, according to the Manufactured Housing Institute. Shipments have started to rise again, reaching 51,606 in 2011.
Troy Hames, vice president of sales at Hames Homes in Marion, said while the manufactured housing industry is recovering, it still has a long way to go.
"This year is a bit better than last year and we are seeing more optimism," he said. "But it's still challenging."
To give an example of how far the industry has fallen, Hames said that in 1996 Iowa manufactured home sales hit 2,200 compared with about 220 in 2012. Sales are projected to reach 280 by the end of 2013, he said.
Hames Homes, which has sold manufactured homes in the Corridor for 44 years, owns five housing communities, which have about 1,200 families. Hames said the developments are about 90 percent full, and the company has additional land on which to expand once the market turns around.
The company sells both new and previously owned manufactured houses. Hames said in the last few years he's seen the percentage of buyers opting for a new manufactured home fall, with about 80 percent now buying a previously owned manufactured home.
"They're more affordable," he said, noting prices range between $25,000 and $55,00.
A number of factors have led to the decline in manufactured home sales along with the struggling economy, said Joe Kelly, executive vice president of the Iowa Manufactured Housing Association, a lobbying organization based in Des Moines.
Chief among them are buyers capitalizing on foreclosed homes, people taking advantage of historically low interest rates and manufactured home buyers having troubles securing financing.
Kelly said financing always has been more difficult to come by for manufactured home buyers, but it has been exacerbated by the financial crisis. Banks and credit unions aren't as willing to offer loans, he said, and specialty lenders have fallen by the wayside.
A bill has surfaced in the U.S. Congress that would make adjustments to lending requirements, Kelly said, but he's not overly confident that anything will come of it any time soon considering how few bills Congress have passed.
"It could be rolled into another bill, but it's an uphill battle whenever you're dealing with Congress," he said.
Troy Hames of Hames Homes enters a mobile home at the Grand View mobile home park in Cedar Rapids on Friday. (Adam Wesley/The Gazette)