This is Part 4 of WGLT’s weeklong series about the business practices at Oak Wood, a company that now owns five manufactured home parks in Bloomington-Normal.
Bloomington-Normal needs more affordable housing. What if we told you there was a way to create a bunch of unsubsidized housing at about half the cost of a traditional single-family home?
That solution is manufactured homes, aka mobile homes. But that option is rarely discussed as policymakers and developers try to address a housing shortage that’s driven up rents and home prices across Bloomington-Normal.
There are many reasons why. The stigma surrounding mobile homes is arguably the biggest. Pop culture turned “trailer trash” into an unfair shorthand that’s hard to shake.
“This is workforce housing. This is bus drivers and teachers and retirees and veterans and all kinds of people seeking an independent homestead, four walls and a roof and a lot of yard of their own, on a budget,” said Esther Sullivan, an associate professor of sociology at the University of Colorado, Denver, who wrote a book about manufactured homes.
Indeed, nearly 6,000 people in McLean County already live in manufactured homes, according to Census data. Around 71% of those people own their trailer, data show, but many rent the land it sits on from the property’s owner.
“This is a deeply affordable source of housing,” Sullivan said.
The stigma around mobile homes took decades to form, tracing back to the “chaotic evolution” of this type of housing, said Dave Anderson, executive director of the National Manufactured Home Owners Association. “Travel trailers” were used to allow mobility during the Great Depression and during World War II, with no expectation they would become permanent housing. That happened anyway – almost accidentally – but with no widely adopted construction guidelines the quality of those earlier trailers was hit or miss.
“And it almost immediately gave mobile homes a black eye,” Anderson said.
Federal standards didn’t emerge until 1976 – when “mobile homes” became “manufactured homes.” But the reputational damage was done, Anderson said. Some Bloomington-Normal neighborhoods resist even upscale multifamily housing construction nearby. A new mobile home park would likely attract similar opposition.
That stigma looms over what’s otherwise an affordable option. The average sales price for a new manufactured home is $115,000 in the Midwest, according to Census data supplied by the Legal Services Corporation. By contrast, the average cost of a resold site-built home in Bloomington-Normal is $287,107.
Some of today’s manufactured homes are “visually indistinguishable from a site-built home,” said Chad Reed, who has studied manufactured housing costs and works at the nonprofit Ivory Innovations.
“People think of like the rectangular [look], very few windows, flat roof, tin siding, and that's not at all what [it is]. You can probably still get a manufactured home that looks like that. But you can also get a home that is really, really nice looking and looks visually indistinguishable but a good bit cheaper,” Reed said.
Financing challenges
There are other barriers, including financing. Nationwide, lenders deny about half of mortgage and home-only loan applications for manufactured home purchases, according to Pew Charitable Trusts research released this year. In Illinois it’s more like buying a car and getting a title than it is like buying a home.
A Bloomington-Normal Realtor who’s helped buy and sell manufactured homes said she’s been unable to find any local lenders willing to finance the deals. She asked not to be named because she doesn’t want more manufactured home listings; they’re a hassle to sell and don’t lead to much of a commission at the end.
The Realtor noted the "skyrocketing” lot rents at five Bloomington-Normal mobile home parks now owned by Oak Wood, the private equity-backed Texas company. That reality, coupled with the prohibitively high cost of relocating your trailer, makes it inadvisable to buy a mobile home, said the Realtor, who lived in one herself decades ago.
“There’s really no strong positives to owning one,” the Realtor said. “You might as well rent and save your money and buy a house.”
For residents, the viability of a manufactured home depends largely on where it sits. In the U.S. about half of these trailers are owned by the same person who owns the land. That’s not the case in the five parks owned by Oak Wood, which leases its pads to trailer owners. That puts them in a “nebulous area where they’re not quite traditional homeowners and they're not renters,” said Sullivan, the researcher from Colorado.
“They're really vulnerable to landlords’ actions, whether that’s increases in rent or failure to maintain properties, or even sometimes predatory or retaliatory behavior, because they have all their housing equity installed on this land that they rent from a landlord,” Sullivan said.
Still, manufactured housing holds promise as an affordable form of housing that could expand homeownership opportunities for low- and moderate-income households, according to Reed’s research.
“Manufactured housing in a park is a really affordable housing option. And unfortunately, there are tradeoffs that come with that,” Reed said.
