Since 2020, lawmakers in six states have passed legislation reducing zoning discrimination against manufactured housing. That makes 31 states that now set limits on their localities’ authority to zone out this inexpensive type of home.
In a time of extreme housing affordability challenges, it’s the right thing to do. Erecting the smallest type of manufactured home, known as “single-section,” that is built to U.S. Department of Housing and Urban Development code costs just 35 percent of what a comparable site-built house does, even after accounting for the costs of transporting the factory-built home and attaching it to a permanent foundation.
Unfortunately, the laws we have so far don’t go far enough. To make manufactured housing a viable choice for everyone who needs a starter home, state policymakers need to take another look at their regulations, particularly when it comes to lot-size requirements.
The strongest of the state laws protecting manufactured housing require localities to allow them on any lot where a site-built house would be allowed. They also prevent local zoning rules from singling out manufactured housing for special design requirements, such as mandates for expensive siding that are not applied to site-built homes.
Available data on state manufactured housing shipments covers the period from 1994 to 2025. During this time, three states have adopted the strongest type of zoning protection for manufactured housing: New York, Utah and Washington. None of those states, however, have seen a large or sustained shift toward more manufactured housing relative to the national rate. Some research even finds that states with zoning protections for manufactured housing have no more manufactured housing than they could expect without these laws.
This may be because these are precisely the states where local exclusionary zoning rules are doing the most to harm housing affordability. State policymakers may feel compelled to do something to address the opportunity to use lower-cost housing in these jurisdictions, but what they’ve done so far hasn’t solved the problem.
Even if localities don’t practice any specific discrimination against manufactured housing, they have rules that drive up housing costs in a more uniform way: mandated minimum house sizes, garages, fancy rooflines, expensive building materials and many more. Manufactured housing can accommodate these requirements, but the larger and fancier the factory-built home must be to satisfy a zoning requirement, the more the cost savings are whittled away.
Minimum lot size requirements are the primary culprit making manufactured housing infeasible. Developers use a rule of thumb that land prices should generally make up no more than one-third of the final sale price of a new house. Where land costs are high and zoning prevents duplexes, triplexes or denser apartment construction, developers don’t site manufactured homes. They build large, fancy houses to achieve the “highest and best use” allowed on the lot.
Survey research finds that local policymakers are more likely to blame their jurisdiction's lack of manufactured housing on land costs than on any regulatory barrier, but the two are interrelated. If these jurisdictions allowed houses to have smaller yards, it could be feasible to build small, basic starter homes, including the siting of manufactured housing.
In new research, I look at how reducing minimum lot-size requirements could open up opportunities for manufactured housing on smaller, less expensive pieces of land. It’s feasible to site a manufactured home on a lot of just 1/16 of an acre, a little more than 2,500 square feet. A 15- by 80-foot home fits on a 25- by 100-foot lot while leaving room for setbacks on all sides, but localities commonly mandate much larger yards. Assuming that an installed single-section home costs about $94,000, the target land price is $47,000 (using the one-third rule described above).
I look at three regions: Northern Virginia; Hampton Roads, Va.; and the Nashville, Tenn., region. Even where these areas have the sewer and water infrastructure needed to serve denser development, the typical residential zoning requires more than one-third of an acre per house in Northern Virginia, about a quarter-acre in Hampton Roads and more than half an acre in the Nashville region. Based on land values in these areas, if minimum lot sizes were adjusted down to about 1/16 of an acre, each region could accommodate a drastic increase in the areas where manufactured housing could be viable.
It’s not just manufactured housing that would benefit from this type of reform. The same approach would reintroduce the sorely needed site-built starter home to many markets as well. State policymakers are showing a willingness to protect low-cost housing construction. The next step is to ensure that design restrictions and — above all — mandates for expensive land aren’t shutting out small homes of every type.
Governing's opinion columns reflect the views of their authors and not necessarily those of Governing's editors or management.
Emily Hamilton is a Senior Research Fellow and Director of the Urbanity Project at the Mercatus Center at George Mason University. She can be reached on Twitter at @ebwhamilton.