Is Buying a Mobile Home a Good Investment?

If you are looking at mobile homes for sale in Jackson, you may be wondering if buying a mobile home is a good investment. Like most financial questions, the true answer is “it depends.” There are some basics to consider before making a decision.

First, most mobile home structures lose value over time, similar to autos and trucks. However, if the cost for buying is significantly less than your alternatives, such as renting, you may end up far better off from a financial perspective. When you pay rent, you lose all the money you paid. Many mobile homeowners purchase or finance their home and lease space on a lot. When you factor in the lot fees and home payments, if you can save $200 a month compared to renting a house, and your mobile home loses half its value when you sell five years later, you still recover half of your investment, plus the $12,000 you saved in costs compared to renting.

Another way a mobile home can be a smart investment is if you purchase the land instead of leasing a space. Not all land appreciates, but if it does, you can end up with a good return on your initial purchase price. If the land does not appreciate, and you still saved money compared to renting you would still come out ahead. Another good reason to purchase land is then you have a fixed monthly mortgage, which will not go up over time. When renting a home or leasing a lot for a mobile home, rents may increase over time, so owning the land reduces your risk of monthly costs increasing. This on top of the chance the land will appreciate in value can be a good investment as well as a way to minimize the risk of your home expenses increases over time.

Since mobile homes tend to be more budget-friendly residences, they are not as affected as the rest of the housing market during dips or recessions. When times are tough, affordable housing demand rises and paradoxically can drive up costs slightly on the low end. As people deal with financial setbacks, they may need to downsize, which increases demand for budget-friendly homes. When prices are skyrocketing, mobile homes tend to have only modest gains in value, but when compared to the costs of the higher valued properties, the monthly savings are even greater, so they still can make a better purchasing decision if the savings are invested.

One thing that needs to be considered when purchasing a mobile home is maintenance. Unlike renting, the mobile homeowner is on the hook for repairs. So you need to factor in money for upkeep and insurance to protect your property and appliances. This is going to be far less than non-manufactured home maintenance, but it needs to be budgeted in order to know if this will still be a smart investment.

Another thing to consider when looking at mobile homes for sale in Jackson, is how long do you plan on staying in the residence? Often times, plans can change, so renting may be a better choice if you don’t know if you are going to stay in the same place. If you purchase a home and need to move in a year or two, you probably will end up spending money on closing fees, and then invest time and energy to sell your home, so you will not likely come out ahead compared to renting. But if you think you will stay there for four or more years, and you are able to reduce your monthly costs compared to renting, then purchasing a mobile home can be a smart investment. 

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