What is a significant factor contributing to the depreciation of a manufactured home?

A significant factor contributing to the depreciation of a manufactured home is its status of not being affixed to land. When a manufactured home is not permanently attached to a foundation or the land it occupies, it is often viewed as personal property rather than real estate. This distinction can significantly affect its value because personal property generally depreciates more quickly than real estate.

Being classified as personal property means that the home may not enjoy the same appreciation potential as homes that are affixed to land and considered real property. Additionally, lenders typically view homes not affixed to land as higher risk, leading to less favorable financing options for buyers, which can further drive down the home's value. This depreciation can be exacerbated by market dynamics, where potential buyers may prefer homes that are securely integrated with land, reducing demand for standalone manufactured homes.

In contrast, changes in local zoning laws might influence land use but do not inherently affect the structural value of a manufactured home, while being on a permanent foundation typically enhances value by classifying the home as real property. Improvements made to the home can also add value, further distinguishing these factors from the implications of not being affixed to land.