Quick Tips: Mobile homes as lower-cost housing

Regina Lewis | Special for USA TODAY

Show Caption Hide Caption Money Quick Tips: Consider a mobile home Paying too much for housing? USA TODAY contributor Regina Lewis explains the benefits and downfalls of a mobile home.

Mobile homes have changed a lot over the years

Try to lock in your land rental rate

Affordability is biggest advantage%2C but depreciation is a downside

A small place by the beach or on the bay. A place in the mountains. Can't afford it? A mobile home just may be the just ticket, but there are some important pros and cons to consider.

In 1969, mobile homes were described as "the coming thing" and started at around $5,000 with an admitted "trailer" look. Now, there are 18 million people living in 7 million manufactured homes.

And Savvy investors like such as Warren Buffett are banking on future growth, especially as 10,000 Baby Boomers a day retire. As journalist Lisa Margonelli suggests in the Pacific Standard magazine, it could be time to re-think what we think of mobile home communities.

Today, the pre-fab "look" can look just like a site-built home. The most basic single-section models run about $30,000-$70,000, about the cost of some automobiles. Home plans can be customized, with many models in the $100,000 price range.

In most cases, mobile homes are sold without land, and there is a fee to "set" them on a plot with a septic tank or hook up to public utilities. From there, the average rent in the U.S. is around $200 to $300. Combine that with the monthly mortgage or finance cost on the actual mobile home, and you're looking at $700 to $1,000 monthly – less than the average apartment rent – and with a chance to have a small yard, perhaps a pet and the feel of a neighborhood.

Try to lock in your land rental rate, since that's a significant part of the monthly cost, and picking up & moving is tricky (it can cost as much as $25,000 to move a mobile home). Because moving mobile homes is prohibitively expensive, there is an active resale market. If you snag a used mobile home with an affordable lot rent, you could get your total monthly cost down to $300 to $500 a month.

New or used, the biggest upside of mobile homes is affordability. As Margonelli reports, they're even greener and, on average, use far less energy and water than conventional homes. The combined cost of electricity, gas and water can be well below $1,000 a year.

The biggest downside: depreciation. Stepping Setting foot in a manufactured home is like driving off the an auto lot – they're worth less from that point on.

For more information:

HUD: Differences between manufactured, mobile and modular homes

National Manufactured Home Owners Asssociation

Recreational Vehicle Industry Association

Regina Lewis is a national television contributor and host of USA TODAY's "Money Quick Tips" videos. Follow her on Twitter: @ReginaLewis.

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