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Home is Where the Low Prices Are

Feb 26, 2007  •  Post A Comment

By Bradley Johnson, Advertising Age

Last year, mobile-home shipments — a parade of 117,300 trailers lumbering behind signs of “Caution: Wide Load” — hit their lowest point since 1961, accounting for less than 7 percent of new homes completed in the U.S., according to a review of Census Bureau data by Advertising Age’s American Demographics.

Mobile homes are a weak spot in a housing market showing some signs of recovery. But 6 percent of U.S. households — 7 million families — live in mobile homes, including 10 percent of families in the South and 19 percent of households living outside of metropolitan areas, according to Census data.

New mobile homes sold for an average of $64,000 late last year vs. a median price of $235,000 for a newly built house, according to the Census Bureau. For millions of families, mobile homes offer an affordable way to the American dream. Consider that 80 percent of families living in mobile homes are owners rather than renters.

Nationally, Census data for fourth quarter 2006 show a near-record 68.9 percent of households owned their homes (including single-family homes, condos, co-ops and mobile homes). Ownership varies greatly by state, tracking to some degree with housing affordability.

The two states with the highest percent of home ownership are West Virginia (81 percent of households owned homes in 2005) and Mississippi (79 percent). Those two states have the nation’s lowest-priced houses, with an ’05 median value below $85,000, according to the Census Bureau’s American Community Survey. Not coincidentally, they are the poorest states in the nation.

The lowest homeownership rates? New York, California and Hawaii — all below 60 percent. California has the most costly real estate (median home price in ’05: $477,700), followed closely by Hawaii. New York state was a relative bargain with a median home value of $258,900.

Not surprisingly, house size is tied directly to income: Richer families have bigger houses. More intriguing, though, is that the age of a home correlates with the income of its occupants: The richer a family, the newer the house.

Families making more than $120,000 on average live in homes built in 1979, a decade newer than the homes of poor families. One possible explanation: Newer homes tend to be bigger than homes constructed decades ago and richer households gravitate to bigger spaces.

When the Census Bureau asked homeowners to assess on a 1-to-10 scale their overall opinion of their home — factoring in good points such as amenities and troubles like bad plumbing — 80 percent gave their home an 8, 9 or perfect 10 score (with 10 the most-cited response). When asked for an overall opinion of their neighborhood, 75 percent offered an 8, 9 or 10 (with 10 again the most-cited response).

Home and neighborhood grades in the Northeast, Midwest, South and West were pretty even. That’s good news: For most families, there’s no place like home.