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Are trailer parks the answer to affordable housing?
Trailer Park
Housing prices keep going up, while incomes remain flat, making homeownership harder for more people. There's still one house to be had on the cheap -- the trailer home. - photo by Marje Cannon, @istockphoto.com

Trailer parks. Long the butt of suburban jokes and eschewed by snobs as shoddy and unsightly.

But home prices are climbing, even as lower-income wage workers’ incomes remain stagnant, making it harder for many people to own a house. At the same time, rents have shot up over the last several years, too. According to 2013 data from the Harvard Joint Center for Housing Studies, 50 percent of renters in the U.S. spent more than 30 percent of gross income on rent. This is up 12 percent points since 2000.

About 35 percent of Americans are renting now, according to the report, and more demand keeps driving rent prices up and up.

Now, enter the humble trailer home. It’s affordable and relatively new and spacious as compared to a lot of cramped, crumbling low-end apartment buildings, say housing experts.

“The manufactured home is probably the most cost-effective way to provide quality affordable housing,” Donna M. Blaze, the CEO of the Affordable Housing Alliance, told The Atlantic. Her company provided manufactured homes to Sandy victims.

“Most of our new units are light years ahead of the apartments for rent in today’s market,” she said.

The median cost of a single-family home last year was $324,000 according to the Census Bureau. A trailer? Just $64,000.

Freddie Mac started financing trailer park developers last year, according to The Wall Street Journal, signaling that the mortgage lender is moving into that market as an affordable housing option.

Of course, that means less funding for other housing, like apartments and duplexes. Banks and lenders are also ramping up their investments in manufactured housing, the report says.

Mobile homes, or manufactured homes, on the market now are often swankier than what we might think of as yesterday’s trailer-park fare.

Kevin Ordway, a carpenter from New Hampshire, and his retired wife Wanita, told The Atlantic that they opted for an $87,000 manufactured home on two acres of land instead of renting.

The three-bedroom, two-bath home had living space, a fire place and a breakfast nook.

“It’s just a wonderful option for people who cannot get a conventional home,” Ordway said. “If you get past the stereotype of a mobile home, these are just as well-constructed as a stick home.”

There are now 18 million people in America living in manufactured homes, according to the Manufactured Housing Institute, and prefabricated homes are getting cool cred from designers like Muji, whose pre-fabricated Vertical House features large windows and sleek design. Other upscale designs, like Square Root Architecture’s, feature patios, decks and skylights.

Of course, most manufactured housing stock is more in the traditional model like the Ordway’s, and there are drawbacks. Loans are not structured like traditional 30-year mortgages and have higher interest rates. It’s also possible for residents to have the land their home rests on sold out from under them, so they are encouraged to buy the land with the home, if possible.

According to the Consumer Financial Protection Bureau, interest rates can be between 50 and 500 base points more than traditional property loans, which is something that buyers should be aware of.

The Ordways told The Atlantic that their loan was 8.875 percent, significantly more than traditional mortgages. Still, they never thought they would qualify for a home loan at all, and were able to qualify through a community loan fund set aside for manufactured homes.

“When I got the call that said we were pre-qualified, I started crying because I didn’t think we would be able to buy a home,” Wanita said.

Email: laneanderson@deseretnews.com