Housing and Mortgage Monitor

This report examines the state of the US housing market and advocates for increased utilization of manufactured housing as a scalable, affordable solution to the national 3-4 million unit supply shortage. It identifies zoning, financing, and perception as the primary hurdles and highlights potential legislative reforms.

Key Takeaways

• 1.There is a shortage of approximately 3-4 million homes in the US, and manufactured housing (MH) is a key potential solution to improve affordability.
• 2.Zoning regulations, negative public perception, and lack of financing access (e.g., chattel loans) remain the primary structural barriers to MH growth.
• 3.Legislative proposals like the 21st Century Road to Housing Act, which includes removing the permanent chassis requirement, could reduce costs by $5k-$10k and increase financing viability.

Table of Contents

• Manufacturing a solution to the housing shortage
• Table of Contents
• The main attraction of manufactured housing is its affordability
• Zoning, financing, and negative perception are key impediments to manufactured housing demand
• Proposed changes are a step in the right direction; however, modifications to local zoning regulations will remain necessary
• Housing Forecasts and Key Charts
• Economic growth remains positive year over year
• US housing affordability is still poor
• Home sales volume has fallen
• Supply of completed homes remains constrained
• 33% of new GSE purchase mortgages have DTI above 43%
• Homeownership rates have ticked down in Q12026
• Sequential home price growth has slowed
• Most US metros are seeing home price growth stabilize
• Household balance sheet metrics remain resilient
• Subprime auto ABS losses have grown
• 2.2% of mortgaged properties have negative equity
• 30-year FNMA prepayment rates were down 16% in April vs. March
• Conventional MBS prepayment rates decreased for higher coupons in April vs. March
• High coupon Ginnie Mae prepayments decreased month-on-month
• About 20% of mortgage borrowers are in-the-money for refinancing
• The Federal Reserve's agency MBS assets remain below $2.1 trillion
• Agency MBS valuations have improved recently
• CMBS delinquency rates remain contained despite challenging CRE fundamentals
• High CMBS note rates will be an obstacle to debt refinancing
• Apartment property prices have declined
• CMBS spreads have tightened