Tuesday, May 5, 2015

Most Inadequate Condition Manufactured Homes Were Built After the Introduction of Federal Building Code

by Matthew Furman
Gramlich Fellow
Since 2000, nonprofits and government entities have increasingly sought to diminish negative perceptions associated with manufactured housing by sponsoring programs that replace substandard mobile homes with state-of-the-art, energy efficient units. As national organizations, such as the Corporation for Enterprise Development and NeighborWorks America, consider scaling up these programs, it is important for housing professionals to ask: what has worked and what has not in this policy space?

As a 2014 Edward M. Gramlich Fellow in Economic and Community Development at the Joint Center for Housing Studies, I had the opportunity to explore one aspect of this question: whether or not nonprofits should focus on replacing manufactured housing built before the introduction of federal building standards in 1976. Some replacement programs exclusively target manufactured housing built prior to the advent of the national building code for manufactured housing (“the HUD Code”) under the rationale that pre-HUD code units are in the worst condition.

The 2011 American Housing Survey (AHS) suggests, however, that units built prior to the introduction of this code in 1976 are not the most likely ones in the manufactured housing stock to be inadequate. In fact, while 10.6 percent of units built between 1970 and 1975 are in inadequate condition, the figure is 10.8 percent of those built between 1985 and 1990. More manufactured homes that are now in inadequate condition were built after the HUD code but prior to the code’s 1994 update (approximately 280,000 homes) than were built prior to the HUD code (144,000 homes).

Source: American Housing Survey, 2011

As shown in Figure 2, pre-1975 units do not demonstrate significantly higher levels of physical inadequacy than 1975-1995 units across a range of features. There are several plausible explanations for this phenomenon. First, the construction standards enacted after the HUD code might not have ushered in an epochal shift. Substandard materials continued to be used in construction into the 1980s; problems with unit installation on sites and enforcement of building standards can undermine the effectiveness of the HUD code. Second, the worst conditioned manufactured homes built prior to the 1976 code might have already fallen out of the market. The units that remain are those that have benefited from weatherization or maintenance.

Source: American Housing Survey, 2011

Roughly 10 percent of manufactured homes, which is approximately the percentage of units in inadequate condition for homes built from 1965-1990, may also represent a natural level of inadequacy for manufactured housing after twenty years in use. Figure 3 compares 2011’s stock of inadequate manufactured housing by year built with the inadequate stock from 2001. A relatively small uptick in the percentage in inadequate condition is evident among units older than twenty-five years. Particularly striking is the sharp decline during the 2000s in the number of inadequate units from 1960-1975: these units are leaving the housing stock. Meanwhile, the number of units from the 1980s in inadequate condition has risen sharply. What policymakers must consider is whether post-HUD code units built in the 1980s will soon leave the market at the same rate as 1960-1970s pre-HUD code units did during the 2000s. At present, the large number of inadequate condition units that were built after the HUD code suggests that the administrators of programs that aim to replace substandard housing should not limit eligibility to pre-HUD code units, which is a common practice. Instead, all inadequate manufactured units, regardless of the period in which they were built, should be eligible for replacement.

Source: American Housing Survey, 2001 and 2011

Read more in Matthew's Gramlich fellowship paper, Eradicating Substandard Manufactured Homes: Replacement Programs as a Strategy


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