A HEDONIC PRICE COMPARISON OF MANUFACTURED AND SITE-BUILT HOMES

Manufactured homes are becoming increasingly popular in America as a way of achieving the dream of homeownership. The purpose of this paper is to compare the prices home buyers pay for structural, locational and neighborhood characteristics of manufactured homes compared to site-built homes. Data from the 2001 American Housing survey are used in this study. Rosen’s (1974) hedonic price hypothesis served as the theoretical framework. Two models were developed using homeowners of site-built homes as one sample and homeowners of manufactured homes as the other sample. Eighteen variables covering structural, locational, and neighborhood characteristics of housing were selected and used in regression analyses. The findings show that many of the same characteristics that affect the price of site-built homes are the same characteristics that affect the price of manufactured homes. Specifically, structural characteristics have the largest effect on the purchase prices of homes. This means that consumers value structural characteristics over locational and neighborhood characteristics