The VA loan can be used to buy a home (including townhouse or condominium unit in a VA-approved project), to build a home, to simultaneously purchase and improve a home, to improve a home by installing energy-related features, or to buy a manufactured home and/or lot.
On manufactured homes, there must be land included with the home and the home must be at least 24 feet wide. The manufactured home must have an identifiable tag. Most lenders are unwilling to offer VA loans for manufactured homes due to the increased risk these loans often carry. (added the link so people can go to the manufactured homes page)