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What's it worth? Murky
pricing hurts consumers January
2005 Executive
Summary Sidebars: Director Author Editor For
more information, contact: Kevin
Jewell, Rafael
Ayuso, Click here to find out more about manufactured housing.
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In May 2003, a Texas couple finished buying their manufactured home in Dallas County after shopping at half a dozen dealerships over the preceding four months. They closed on their newly constructed basic "Alamo by Clayton" 16 X 76 single-wide home, paying about $42,000. 1 About a two hour drive east, in Franklin County, another consumer was settling into his new home. This home was also a basic "Alamo by Clayton" 16 X 76 unit, purchased a few months before from a dealership in nearby Sulphur Springs. The Franklin consumer paid only 33,800 for the exact same home.2 Did the Franklin consumer get a great deal? When the Franklin County tax appraiser came to value his home, he assigned it (excluding land) an appraised value of $25,300. This lower appraised price likely reflects some dealer markup and installation costs which would not be captured on resale by the consumer. The Franklin consumer's $8,500 markup over appraised value looks like a good deal compared to the details of purchase by the Dallas County couple. Their tax appraisal (for the same model home) came in slightly lower than the Franklin County home, $22,920 for the home only. This makes the un-recoverable markup on their home an astonishing $19,080, lost equity that will cause them to owe more on the home loan than the home is worth for years to come. 1
Response to Consumers Union Survey of Manufactured Home Purchasers, phone
interview. Survey ID: 1120. Dallas County Appraisal Rolls. |
 Consumers Union Offices: Communications Office, New York - Washington Office West Coast Office - Southwest Office - Consumer Policy Institute
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$42,000, $34,000, or $25,000?