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Factory Builders Add Units and Influence

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Factory Builders Add Units and Influence

Market Says 'More' and the Industry's Biggest Deliver.

By Patrick L. O’Toole, Senior Editor March 31, 2000
This article first appeared in the PB April 2000 issue of Pro Builder.
With 348,671 units delivered in 1999 representing 20% of all new home sales, manufactured housing is emerging as a crucible of technology and marketing innovation in the home building industry.

Segmented into modular, panelized as well as shelter units that conform to the U.S. Department of Housing and Urban Development’s building code for transportable housing, the trends speak volumes. More than 60% of HUD-Code homes are two units or more. Meanwhile, the number and variety of home plans continues to soar. Steeply pitched roof lines are even available.Square-footages now run from 600 to 6000 as buyers from all segments are discovering the advantages of the affordable and reliable alternative stick built. Champion Enterprises, for example, says first- and second move-up buyers now comprise 35% of its sales.

Professional Builder’s second separate listing of the 25 largest Manufactured Housing Giants covers a huge portion of the market. These Giants delivered 334,195 units or 96% of the total, a share that increased nearly nine points from last year when the pie was a bit bigger with 372,843 units. Meanwhile, the names on the list have changed little. Last year’s No. 16, Homes of Merit Inc. was acquired by Champion early last year.

In many ways the industry is at an important crossroads. Pending federal legislation could alter the permit fee structure for HUD-Code units as soon as this summer, increasing the funding for the group within the housing department that manages the code. With increased staffing at the department, the industry is hoping for important code reforms - namely the removal of the requirement that steel undercarriages be built under each unit. Industry leaders say the requirement dates back 25 years to a time when most manufactured housing was actually built on wheels.

If these reforms happen, a revolution in design could transform the industry and blur previous distinctions between other manufactured housing types.

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