Will My Mobile Home Depreciate? Factors in Home Appreciation.
The Myth of Mobile Home Depreciation.
Everyone knows as soon as you drive your brand new car off the lot, its value drops at least 15% with no hope of appreciation.
I’ve heard this particular truth applied to mobile homes as the number one reason not to buy one.
“Don’t you know you’ll never get your money back on one of those? You should buy a real house.”
It is a misinformed statement that just isn’t true.
Real estate and car buying are two completely different industries, meeting two completely different needs.
And, in fact, our mobile home is worth about $25,000 more than on the day we bought it four years ago. That’s over $5,000 of appreciation every year.
How can that be if mobile homes don’t appreciate?
Well, there are quite a few factors involved in any home appreciation, whether it is considered a manufactured home or site-built.
- Selling Market
These are just to name a few.
Let’s run through some of these variables and talk about why they make a difference in the appreciation of your mobile home.
Unfortunately the mobile home industry has developed a bad reputation for deceitful business practices. With Braustin’s business model, we are attempting to turn that ship around. And the sad fact is, many people have been ripped off by greedy salesmen in all different industries.
The best way to gain appreciation on your mobile home is to buy it for the fairest price.
This is the way people make money in the real estate business all the time—buy when the buying is good and sell when the selling is good.
With buying a brand new mobile home, there isn’t as much guess work. In general, if a mobile home company is willing to be open and honest with their prices before running your credit score or needing to know how much cash you have available than you can be pretty sure you are getting the best price.
And later, if you decide to sell, do the research to ensure you are selling when others are buying. Some seasons—and real estate agents—are better than others.
Location—Different areas have different values.
Our home is located east of San Antonio, Texas in an area with a highly rated school district, large property parcels and quiet families. Crime is low, neighbors are friendly, and the area is beautiful.
Simply choosing this area with the knowledge it was “the place to be” made our investment just that—an investment.
Some might argue it’s the property itself that has gained appreciation and not the home. And while there is some truth to this, it has nothing to do with owning a mobile home, and everything to do with the simple supply and demand of an area. Where there is more demand for habitable property than there is supply–prices go up.
A case could even be argued for buying property, investing in the initial work of making it habitable, and then selling it.
To be honest, the family we purchased our home from could have sold the home more quickly and for more money if they had done the research on “staging”.
The main living area was an awkward shade of yellow, the kitchen: pumpkin orange, and the other rooms were a whole host of crazy colors.
If you want to sell your home for a profit, thought has to be put into what the majority of buyers want to see. Otherwise, you will have to wait for the right buyer who can look past superficial details to come along. And there aren’t many of those.
Even more than this, a home that looks run down and neglected will give the impression that it is a money pit. Taking care of your new home gives buyers a peace of mind when they are buying.
It’s the same reason a garage kept, gently used car is worth thousands more than one with stained seats, sun-burned paint and bald tires. People take one look and say “Well, if it looks like this on the outside, I can’t imagine the problems I don’t see!”
Buy for the right price, do some research on the area you want to live in, and take care of your home. Appreciation isn’t a guarantee in any kind of home, but nothing in life is a guarantee, really. In the end, owning the place you live in is its own worthwhile investment, and making a little money down the road is icing on the cake.