COLLEGE STATION – Texas’ manufactured housing industry continued to ramp up production in September as new orders and sales volume maintained a steady climb, according to the latest Texas Manufactured Housing Survey (TMHS).
“The manufactured housing industry is providing a product that is increasingly attractive to many homebuyers, especially those looking to migrate outside of urban areas,” said Real Estate Center Research Economist Dr. Harold Hunt.
Supply-chain disruptions and contractions in the labor supply, however, prevented production at full capacity and contributed to a large increase in backlogs.
A combination of robust demand and supply-side constraints have translated to higher sale prices, but the price of raw materials has also elevated in recent months. Lumber prices in particular have spiked since March and may remain elevated in the aftermath of the forest fires on the West Coast. Manufacturers, however, anticipate inflationary pressures to subside by the end of the year.
“Manufactured-home shipments generally decline in September, but the TMHS indicates that plant production expanded,” according to Rob Ripperda, vice president of operations for the Texas Manufactured Housing Association (TMHA). “That’s good news and means plants are ramping up as we move into October, typically their most productive month. Quoted deliveries are extending well into 1Q2021, so materials shortages are the most pressing concern on factory manager’s minds, but it hasn’t slowed them down yet.”
The ongoing COVID-19 pandemic has generated significant uncertainty throughout the economy, but housing manufacturers remained optimistic about business activity and the overall outlook heading into fall. This confidence has led to higher capital expenditures and preparations for further investment early next year.
The Real Estate Center and the TMHA have partnered to produce a monthly survey of business conditions and expectations surrounding the manufactured housing industry.
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