Housing Market Inflation For Mobile Home Dwellers
According to an estimate, around 6% of the American population currently dwells in mobile homes or trailer homes. These homes are placed in trailer parks, land designated for mobile homes, and rented by mobile home dwellers. Just in a decade, the prices of these manufactured units have doubled. However, the dwellers find the land rent more distressing, and many residents state that the land rents have doubled and even tripled. Just as in 2008 when the global financial crisis occurred due to the collapsing housing market bubble, the inflation in the housing market faced another surge after the global pandemic when the markets suddenly reopened, and the businesses ruined back to routine. Some major causes are discussed below:
Corporates Owning The Trailer Parks
The increasing trend of corporates owning trailer parks and turning them into commercial or residential (single-family only) land reduces the venues for mobile homeowners to rent. The reduced supply of land and more demand led to the increase in the rents of trailer parks.
Affordability Of Masses
Due to high inflation in different states like Louisiana and Iowa, people from these states find it hard to own their own houses or pay the rent of houses and flats. The alternative they find is a mobile home that they can own at a much lesser price (about one-fifth the price of single-family housing). Again, it is seen that the supply-demand principle holds true and increasing numbers of masses have been turning toward mobile homes, further adding to the land rent of the trailer parks.
Panic Selling And Housing Investments
Property is a fixed asset that is also considered an investment. When COVID-19 took over the world by surprise, many people observed lowering prices and thus planned to sell their property in hopes of futureproofing their investments. However, this decision did not pay off and as soon as the extent of the pandemic weened off, the property prices hiked to unimaginable levels. More and more people started investing in the property as they saw the values skyrocketing. This also led to the rent of the properties being enhanced beyond expectations.
Fuel Inflation
Due to the increase in petroleum prices, the price of every other commodity connected to fuels increased during the past few years. This is also true for the materials of construction and land for lease as the property market is also connected to transportation affordability. In search of venues from where offices and utilities are at minimum distance, people move from one place to another or at least find new homes at places convenient to them in terms of fuel consumption. This also adds to the price hikes of land. Since the overall value of land increased, so did the rent for mobile dwellers.
How Can The Rents Of Mobile Homes Be Controlled?
Some states of America have regulations considering the allowable limits in which the rent can be increased. Just like commissions for regulating businesses, the regulators for land pricing and rents monitor the affordability and realistic land values before announcing the limits. This can be one way in which the housing market inflation can be controlled. Furthermore, subsidized housing schemed by the government can also relieve the public from the vicious cycle of year-on-year rent and mortgage increments.
Now we have learnt “Housing Market Inflation For Mobile Home Dwellers”, The housing market took the single-family home dwellers as well as the mobile dwellers alike. The prices of land for owning and land renting increased after the pandemic increased beyond limits. Since more and more housing projects and business ventures were announced, the land remained limited and as the demand was more, the corporates owned the lands meant for trailer parks for commercial projects. Fuel inflation and public affordability concerns further limited the land for mobile dwellers adding to demand where the supply was very limited. Therefore, housing inflation surged that almost tripled land rents for mobile dwellers.
Q1: How much does a mobile home cost in the present day?
Answer: Nowadays, a mobile home costs around $130,000.
Q2: What are the reasons for the popularity of mobile homes?
Answer: The lower cost involved in buying these homes as well as the ready-made nature of these structures are the main reasons for their popularity among low-income families.
