January 9, 2025

Manufactured Housing Occupancies Hold Steady, Rents Continue to Rise

Q3 2024

Consistently strong occupancy conditions in the national manufactured housing market continued to fuel strong rent growth across the country in the third quarter. The national occupancy rate held steady at 94.8 percent, matching the levels from the first two quarters of the year. Despite leveling off in recent quarters, the national occupancy rate rose by 20 basis points during the past year, a continuation of the improving trend that has been in place for the past several years. Rent increases have been particularly strong since 2022. Current rents are $717 per month, up 7.2 percent during the past year. Cumulatively, average rents for manufactured housing communities have spiked by more than 20 percent since the end of 2021.

Buyers and sellers in the manufactured housing investment market appear to have aligned their expectations, as transaction volumes during the third quarter returned closer to traditional norms after being light during the first half of 2024. Total sales in the last three months more than doubled the limited levels recorded last quarter while outpacing the totals posted in the same period of 2023 by 21 percent. The surge in sales activity came at the same time as a dip in cap rates. Cap rates averaged between 6.25 percent and 6.5 percent during the third quarter, after averaging 7.5 percent in the first half of the year. Pricing remains elevated due in large part to gains recorded in high-activity states, California and Florida.