Recent HUD Update Could Significantly Impact Manufactured Home Construction

Last month, the U.S. Department of Housing and Urban Development (HUD) announced the most extensive update to the Manufactured Home Construction and Safety Standards in more than three decades. The revision is designed to help modernize the manufacturing housing (MH) industry, increasing the number of affordable housing options across the United States.

“These changes will incorporate consumer-requested designs and allow manufacturers to build duplexes, triplexes, and fourplexes. With average prices per square foot of $82 for single-section homes and $88 for multi-section homes in 2023, this expansion could significantly increase affordable housing supply where needed most,” said Rob Ripperda, vice president of operations for the Texas Manufactured Housing Association (TMHA). 

The updates will align MH features more closely with site-built housing, expanding their appeal to a much broader range of consumers. Additions and updates to the new HUD rule include allowances for more open floor plans and improved homeowner accessibility. More modern design approaches and alternative building materials will be allowed. The rule change is also meant to extend the cost-saving benefits of MH to denser urban and suburban regions, resulting in more affordable housing in cities where space is limited. 

HUD believes the updated regulations will also streamline the MH production process by reducing red tape and eliminating the need for alternative construction approvals for materials that already meet or exceed HUD standards. For example, the new standards will now explicitly allow the use of more modern and energy efficient appliances such as tankless water heaters that previously required manufacturers to get special approval. The change should increase the level of MH innovation, resulting in a greater supply of manufactured homes. 

The new regulations are accompanied by changes in financing options such as increased loan limits for the Title I Manufactured Home Loan program and a revision to eligibility requirements for Ginnie Mae’s Manufactured Housing Mortgage-Backed Securities program. The changes are designed to improve financing availability, particularly for low- and moderate-income individuals and households in urban areas.  

Some cities are also taking steps to integrate manufactured housing into their communities. New local initiatives, combined with the new federal regulations, will hopefully increase the availability of MH in urban and suburban areas.