Miriam Moore, the President of Default Services at ServiceLink, shared insights on the current housing market for lenders. Despite the shortage of housing, demand exceeds supply, and lenders are looking for ways to attract qualified buyers. According to a report by ServiceLink, Gen Z and millennials are most likely to purchase homes in 2024, but face obstacles such as high interest rates and limited availability of homes.
The U.S. is short by 3.2 million housing units, and new construction, while helpful, may not be affordable for younger buyers. Manufactured homes, including modular and mobile homes, offer a more affordable alternative to traditional homes. Built in a controlled setting, these homes are quicker to produce and have a lower price point, costing around $72 per square foot compared to $144 for traditional construction.
Manufactured home builders are increasing production of single-family homes, with growing interest from buyers. However, financing for these homes can be challenging to obtain as not all lenders are familiar with the process. Lenders looking to thrive in this niche market need to understand the unique nuances of manufactured home lending, work with experts who have knowledge of the conversion process and regulations, and demonstrate commitment to serving this market.
Lenders need to familiarize themselves with the titling and conversion process for manufactured homes, as well as be aware of the appraisal rules specific to these homes. Partnering with companies that have experience in manufactured home transactions can help streamline the process and avoid delays. By demonstrating commitment to helping buyers achieve their homeownership goals, lenders can differentiate themselves in the market and attract this new group of buyers.
Overall, getting into the manufactured home lending arena can be a strategic opportunity for lenders to expand their portfolio and serve a growing segment of buyers. With the right expertise and commitment, lenders can tap into this niche market and provide affordable housing options to those facing challenges in the current housing market.
