Dive Brief:
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Demand for manufactured housing is at an all-time high, industry players told The Wall Street Journal this week.
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A lack of affordable units in the traditional housing sector has boosted demand for manufactured homes and padded the value of that industry’s three real estate investment trusts: Sun Communities, Equity Lifestyle Properties and UMH Properties, the newspaper reported. Coupled with more demand from families that otherwise might buy stick-built homes, a buying spree by the largest manufactured housing companies has reduced competition and allowed manufactured home landlords to raise rents.
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At Sun Communities, for example, the average monthly rent rose by 2.5% between 2013 and 2014, from $445 to $456.
Dive Insight:
Investors told The Journal they expect profits for the sector’s largest players to continue their upward spiral, as first-time homebuyers, snowbirds wanting inexpensive vacation homes, and low-income families continue to opt for manufactured homes over apartments as rent increases for multifamily apartments outpace those for manufactured home parks. Buying and owning a manufactured home also is less expensive than renting an apartment, at least in most metropolitan areas, The Journal said.