Trump Administration Unveils New Steps To Bolster Manufactured Housing

The U.S. Department of Housing and Urban Development wants to fast-track manufactured housing construction, bolstered by changes to the law this year.

HUD on Wednesday unveiled an action plan to accelerate manufactured housing building. It wants to update energy efficiency standards, update design and construction codes, and help scale the industry. HUD's plan follows other federal efforts to make it cheaper to build manufactured housing more generally.

The bipartisan 21st Century Road to Housing Act signed into law this year eliminated the requirement that homes be built on a permanent steel chassis. That's a bid to shave down construction costs. In a complementary move, HUD started to amend its own code to allow multistory manufactured housing, which would allow larger homes to be delivered on-site.

Experts believe manufactured housing—ranging from pre-fab building materials to factory-assembled homes—is a kind of alternative building that can mean cheaper homes. But manufactured housing is a niche product fighting a stigma, and experts think it needs awareness and financial support to take off.

The chassis requirement is a much-hailed change. Experts say most manufactured homes never leave one site. And the chassis saves an estimated $10,000 off the cost of a unit. This allows starter-home construction that might benefit first-time buyers.

“For 50 years, the HUD Code has provided a national framework for safe, quality, affordable housing,” HUD Secretary Scott Turner said in a statement. “Now, HUD is building on that foundation to expand innovation in design and construction for the next generation of manufactured homes to unleash the American Dream for even more families.” 

New possibilities

HUD says manufactured housing is at an "important transition point." With the chassis code repealed, there are new possibilities for home construction. The agency says now is a good time to modernize the building code to reflect new innovations and construction techniques.

Specifically, HUD will modernize two parts of the building code: construction and safety standards in Part 3280 and model installation standards in Part 3285. But while the housing bill requires immediate changes, HUD will update related provisions, too.

Congress has considered energy efficiency mandate rollbacks this year, and the housing bill also put forth changes.

The chassis requirement's abolishment means immediate changes to the code. HUD will update it with new standards for structural design, lifting, transportation, and connection. The government also wants to look at new standards for foundations, anchoring, connections, and setting. It believes there are a wide range of support systems and designs that might suit these new homes.

“Removing the permanent chassis requirement is more than a technical change,” Joe Gormley, who oversees the Office of Housing and FHA, said in a statement. “It creates an opportunity to reconsider how manufactured homes are designed, transported, assembled, and regulated, so we can increase supply for first-time homebuyers.” 

HUD will also consider a performance-based code for multifamily manufactured housing. These larger buildings, and their common areas, shared systems, and fire separation, need to be addressed in HUD codes. It thinks this is a chance to create a consistent framework for multifamily modular construction that makes it easier to build nationwide.

Finally, HUD says it must address factory certification, design approvals, and quality controls. These standards provide an on-ramp to new builders who want to enter the world of modular housing. And HUD will create case studies to show these new builders the lessons it's learned in the process.

Builders seek streamlining

The changes follow as manufactured housing played a prominent role at HUD's Innovative Housing Showcase in Washington, DC. Realtor.com® profiled a few of these innovations, including a 3D-printed home, a forklift-delivered unit, and Cavco's first nonchassis manufactured home.

Developers tell Realtor.com the industry needs more definitive guidelines to accelerate manufactured housing.

Michael Tillman, CEO of Florida investment and development firm PTM Partners, says every city looks at manufactured housing differently. The success of the housing bill, and Washington's focus on affordability this year, "legitimizes" the industry and makes it more attractive to raise capital.

His company uses premade steel and prefabricated materials to build multifamily developments. Modular construction helps them assemble buildings on-site, and much faster than standard construction. This makes the homes more affordable as workforce housing, affordable to those making 80% to 120% of area median income.

"The biggest problem we have now is there's no uniform zoning," Tillman tells Realtor.com. "That makes everything difficult."