Real Estate the Ramsey Way - Why A Mobile Home Is A Dumb Idea

Episode Date: August 10, 2026

Thinking about buying a mobile home? Dave explains why he believes they're a poor financial decision, breaks down the risks, and shares what he recommends instead. Next steps: ·   🏠 Not sure what to do next when buying or selling your home? Check out our ⁠⁠Real Estate Home Base⁠⁠ for free tools and resources to guide your next steps. ·   🏠 And if you’re ready to buy or sell your home, ⁠⁠connect with a RamseyTrusted® real estate agent⁠⁠. They’re experts who’ll help you confidently navigate homeownership the way we teach. Explore more from Ramsey Network: 💸 The Ramsey Show Highlights 🧠 The Dr. John Delony Show 🍸 Smart Money Happy Hour 💰 George Kamel 📈 EntreLeadership   Ramsey Solutions Privacy Policy

been following you 13 and I am debt free and I have a house in the Sacramento area. But I have since moved in the last year to a very rural and remote property. And I cash flowed it. And I lived for a year in a travel trailer because I bought it, you know, for cash. And also I wanted to make sure if a fire came through, I could evacuate if I had enough time. with my house. Since living here for a year, I've found that, you know, I would like something a little more permanent. However, I also don't want to have to pay fire insurance because according to my neighbors, it's between $10,000 and $12,000 a year. Also, I get, so, okay, I'll stop there and say, so I'm thinking about building a mobile home, which I know mobile homes

are not a good investment. However, I still own my home in Sacramento as far as an investment. rent it out to traveling nurses. So every 90 days is a turnover and I make sure that it's in great condition. So I wanted to get your opinion, is it still a bad idea to cash flow a mobile home to have something a little more permanent, but to save on insurance basically, to not have to pay the fire insurance knowing I'm taking the risk if a fire comes through. Okay. So what would the mobile home cost? The mobile home is about $100,000. I'm So when it's worth $10,000 later when it goes down in value, how do we put this in the smart column when it goes from $100 to $10,000?

I'm wanting to say that instead of being an investment, it is a consumable good. It is something that I live in. Yeah, but if you put the same $100,000 in a house, it would have gone up in value. Yes, but I would feel much worse if a fire came through and burnt it down. And I would feel compelled to get that fire insurance. Yeah, I would too. I would too, but the thing is you're losing $90,000. That's a lot of feel good.

Yeah, that's true. You're saving $10,000 to lose $10,000 every year in that mobile home. Ooh. Yeah. So I don't think it's as good a deal. You're going to lose more than $10 the first year on the mobile home. Yeah, yeah. So beyond a cost, or I guess the financial component, is there anything else about mobile home?

I guess I shouldn't say that. No, that's it. That's the only thing. It goes down in value. If they went up in value, I'd shut up. Then you'd be okay with it. All right. All right.

But, I mean, it's a car you sleep in. Yeah, exactly. It goes down and value. It's a modified, it's an increased, decreased in cost, depreciating consumable item. It's a bigger version of their travel trailer that you don't want to live in anymore. Yeah. In terms of math.

That's the math on it. That's my only problem. I mean, one of my good friends owns one of the, largest companies in the world that does those things. And he's like, Dave, would you quit treashing it? Well, as soon as they start going up in value, I'll quit trash in it. But they're not going to go up in value. So would I do that?

No, I would not do that. I would pay the fire insurance and I'd build a house. Okay. Yes, that was my second question. And if I need to sell the house down in the valley to do that, I would do that. It sounds like you do need to because you don't have the money. Oh, I have money. How much money?

So I currently have 130,000. in cash to build a mobile home, but before I build it, I want to make a more. You're not building a mobile home. You're buying a mobile home. Other people build them at a factory and they send it to you. It's on wheels, remember? Exactly. No, exactly. But it's also putting it on the foundation here, putting, you know, getting the water sewer, all that. So that's why. Yeah, which you're going to do with the house anyway, yeah. Exactly, exactly. It's just the gut of, you know, what is the house in the valley worth? It's worth $500,000 and I own it outright.

I would sell that and build a house for cash. Oh, yeah. I just... Let me ask you this. If you owned a house on this wonderful piece of property that you love, and it was 100% paid for it and it was worth $600,000, and you did not own a rental property with nurses in it, would you borrow on your paid-for home to go buy a rental property?

Oh, no, no. It's the same thing. Wouldn't borrow either way. It's the same thing. When you don't sell the rental property and end up borrowing, to build the house, it's the same thing. Yeah. If I build a house, I would need to save longer before building the house.

I wouldn't sell. You know, I would stay in a travel trailer longer until I have the money to build the house outright. Or I would do it. I wouldn't. I wouldn't. I wouldn't have been in the travel trailer in the first place because I'm a snob. So, yeah. I mean, for the weekend maybe, but after that, I'm done.

If you're camping, I might see Dave in there. And, you know, if you did see me in there, I would be without sure. Sharon, that would be the other thing. Sharon's not stepping foot in that. She will not darken the door of that. She's like, good luck with that theory, Bub. She's more of a glamper. Especially these days.

Okay, so. But yeah, owning a home is a long-term decision. So you want to think long-term. Ten years from now, was this a good idea? Yeah. And that's the problem with mobile homes. You know, because they're, you know what, almost always, and in her case it is too,

but almost always drives the mobile home decision is I don't have the money. And so I'm going to cheap out. And you can cheap out. And for $100,000, you can buy something you can sleep in. And they're fairly nice at $100,000. I mean, it's a pretty nice one. Yeah. That's not a bad one.

They make them up to $300 or $400 or whatever. But, I mean, $100,000, that's a pretty nice place. But you're right. I mean, it's going to lose more than $10,000 the first year. And then people also get confused and rationalize with, oh, well, the property went up in value, but it was going to go up in value whether it had a house on it or whether it had a mobile home on it. And don't just because it, don't confuse that with the mobile home went down in value. It still went down in value. Like 100% of things with cars, with wheels and

or motors. If it has a motor, it has wheels, it's going to go down in value. Period. your little John Deere tractor that you paid $8,000 to mow your quarter acre lot with and you financed with John Deere finance is going to go down in value your sea do is going to go down in value your mastercraft I got two of them they're going to go down in value the world's best ski boat thank you very much it goes down in value they're fabulous they go down in value that collectible Corvette I have in my basement is going down in value and it's a They're any and George your battery with wheels your Tesla is going down in value. I know that the hard way. I'm trying to sell it right now. Nobody wants it, Dave.

You can't give that thing. Nobody wants a battery. Nobody's in the market for like an iPhone 4. You know, they want the latest and greatest. You're buying technology here. But it's true. It's why we say pay cash. If you're going to buy depreciating asset, always pay cash. And honestly, you feel like right now you're trying to get rid of that car and you can't get rid of it. that's one bad feeling. It would be triple bad if you had financed that. If I was underwater on it.

And you're sitting there paying payments and you can't give it away. Now you got lots of pissed off. Now you're just moderately aggravated. Yeah. Just a light stupid tax on something I enjoyed. Yeah. And well, the other problem with it is, is you know, I'm going to make fun of you. So that's another problem.

I almost thought you might want to buy it just to troll me with it. But I figure you're not going to put money into that. Could we like put it in the front yard and plant flowers? That's what I was thinking. I thought you were going to, like, you know, take it to the farm, take it out back. Oh, we could shoot it. And just destroy it. We could take the Barrett 50 Cow and shoot it.

It's cheaper than some of these fancy hunting trips that you go on. So I figure. That would be fun. We could make some content out of it. We could make a video out of it. Let's charge it to the company. You know what, Dave? I like the way you're thinking.

You run the thing. We'll get the Instagram team out there. Hey, team, clip this out. I want to be able to use this in a court of law. Yeah. When I make Dave buy this company. It's not happening. It was a good.

You had a moment there. I was close. It's close. Oh, man. Whether it's a Tesla or mobile home, it's going down in value. Elon Musk would be so pissed if we took that thing out to the farm and just blew the hell out of it. I think he's got a sense of humor. You might enjoy it.

I'm 25 years old and self-employed with an average salary of $100,000 a year. I have a net worth of $400,000, and my fiancé would be out of school and getting a job within a year starting out at $95,000 a year. I have saved $200,000 to put down on a house for a down payment. Should I buy my dream home for $450,000 in the best neighborhood in town or a house that costs $200,000 in an okay neighborhood, knowing that we want to move into another neighborhood in the next couple of years? We have no student loans or car payments and we'll be getting married later this year. Ooh, okay, a lot of variables here. It's like a little riddle, a lot of timing. I'm going big.

Yeah, well, I'm wondering, can you wait to buy the house until you're married? Oh, for sure. Why the urgency right now to get the, I would get the $450,000 house, but I would wait until you're married. Yep. Because then you know that you know that you know both incomes are there. Because what if, God forbid, maybe the wedding gets pushed and you're stuck with a mortgage payment that's a little tight for your $100,000 income, which is amazing. But you take on a $250,000 mortgage. I don't know what the payment's going to be compared to your take home pay.

That's right. I would assume that after you get married, you guys would be making $200,000, you put, and maybe rent for one year, right, before you jump into the new neighborhood and save an extra $5,500, right, to add to the down payment. And if you put $250 down on a $450,000, $450. Oh, my goodness. Beautiful. The options you have will be amazing.

You'll pay off the mortgage fast. And then fast forward, let's say your fiancé wants to stay home one day. We just took a call about that. that, yep. Guess what? It's a no-brainer. You're like, yeah, our mortgage is a thousand bucks a month or it's paid off, no-brainer to do this.

Or you jump in right now with that mortgage that's a fixed payment and it gets tight if she decides to stay home. That's the kind of stuff you need to think about with a home. It's a long-term decision. So I would wait, I think renting is wise for six to 12 months, then jump on it and get that dream home, my friend. That's a great question. He's in a good place.

Yes. Because we do, I mean, if you guys didn't have like a. you know, a big goal of like, oh, we want to be here and a $200,000 house was sufficient. And you're like, no, this is perfect. This is what we're wanting. And that's great. But if you know you're going to be moving up and home in three years, then I wouldn't, I wouldn't stare step in. You don't want to be jumping in and out of homes within a three years span. Because you have the money. Yeah. It's expensive. There's realtor fees. There's closing costs. It's a hassle to move. You want home appreciation to actually, you know, have some foothold here. And that's going to take at least three, four, five years.

similar to the stock market because in a given year, the home price could actually dip for a little bit. And so I think you're doing it the right way. Toby, I would just be patient and wait until you're married to pull the trigger on the home. That's awesome. Hey, guys, thanks for listening to Real Estate the Ramsey Way. Now, if you're here, you're probably thinking about buying or selling a house. It's exciting and one of the biggest financial decisions you'll ever make. But you don't want to do it with an inexperienced agent who will rush you into costly, mistakes, like the ones some of our callers find themselves in. You need a pro who knows what the flip they're doing and will keep you on track with your financial goals. That's why we only recommend Ramsey trusted real estate agents. These are vetted, hand-picked pros who actually listen to your needs, guide you through the process, and fight to get you the best deal. To find a Ramsey trusted

agent near you, go to Ramsey Solutions.com slash trusted agent. That's ramseysolutions.com. That's ramseys solutions.com slash trusted agent.