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Whether you’re a first-time buyer or a seasoned property owner, a modular home can offer unique flexibility and lasting quality — often for less money than a conventionally constructed house.
But if you’ve not yet considered a modular home, you’re not alone.
Of the nearly 140 million housing units in the United States, just 22 million people live in manufactured houses. A remarkable 90% of those folks report feeling satisfied with their prefabricated home; tiny houses continue to rise in popularity, while manufactured log homes have been on the market since 1978. It’s clear that the overarching concept of a modular home is neither new nor unfavorable.
So why aren’t more homebuyers taking a closer look at modular homes?
To better understand exactly what a modular home is, along with the pros and cons of buying one, we’ve dug into research from some of the country’s best modular home producers and chatted with Randy Reeds, a real estate agent with more than three decades of experience in Grand Rapids, Michigan.
What is a modular home?
The key is in the name: “module.”
A modular home is a house that is built, section-by-section, in a factory setting. These are massive, climate-controlled facilities that assemble homes according to the International Residential Code (IRC), which requires compliance with all state and local building regulations.
IRC is similar to the U.S. Department of Housing and Urban Development (HUD) in that both put forth standards for quality and safety. When it comes to manufactured homes, HUD requires each home to have an attached steel chassis to help with transport, whereas homes constructed to IRC specifications are set on a permanent foundation — just like a site-built home.
When a modular home has been fully fabricated, the sections are then transported to the building site (usually via semi truck) and, with the use of cranes, are assembled on a poured foundation.
Once assembled, the construction process of a modular home is just like that of a conventional build: It’ll be hooked up to utilities, and the interior will be fitted with appliances, cabinetry, flooring — all the bells and whistles.
“Inside you can have the exact same cabinets, granite countertops, whatever you like,” says Reeds.
Modular homes “are a night and day difference from 20, 30, 40 years ago. They’ve stepped up the quality and can truly be equal to a site-built home.”
What do modular homes look like?
Just as blueprints for new-construction homes can vary widely based on customer needs, neighborhood regulations, regional norms, lot size, and overall budget, so can the floor plans for modular homes.
Because modular homes are highly customizable, manufacturers often have architect partners who can work with you to adapt floor plans to your individual wants and needs.
So, whether you’re looking to downsize and would prefer a small home akin to a studio apartment, or your family is growing and you couldn’t possibly consider a house that isn’t at least 3,000 square feet with two floors, today’s modular homes can accommodate your lifestyle needs.
What are the advantages of building (or buying) a modular home?
Aside from the made-for-you adaptability of the modular home construction process, there are several additional perks to taking this increasingly popular route to homeownership.
Modular homes are completed faster
Because these houses are fabricated indoors, there are no construction delays due to adverse weather conditions. This allows modular homes to be built year-round, finishing major components in weeks rather than months.
Modular homes are high-quality
Thanks again to the indoor construction, modular homes demonstrate an exceptional level of quality and consistency. Whereas a site-built home is exposed to the elements and thus subject to rain, wind, and temperature changes during the construction process, a modular home is fabricated in a climate-controlled setting that ensures straight walls and corners that meet perfectly every time.
Plus, modular home sections have to be transported to the site, meaning they must be resilient enough to withstand handling. “From a structural perspective, they’re pretty strong homes,” says Reeds.
Modular homes can offer more bang for your buck
By streamlining the construction process and avoiding on-site delays that can arise due to anything from inclement weather to supplier mishaps, modular homes simply cost less to build.
While a shorter lead time contributes to lower costs, manufacturers also buy their materials in bulk, resulting in cost savings that are easy to pass along to the consumer. As Reeds says, “You generally get more for your money [with a modular home] than you do with a site-built home.”
Modular homes are environmentally friendly
The efficiency of fabrication helps to reduce excess materials and overall construction waste, and due to the exceptional construction quality, modular homes are reported to operate approximately 15% more efficiently than site-built homes — saving you money in annual heating and cooling costs.
What’s more, because modular homes are so adaptable, yours can be designed with self-sufficiency in mind, like solar panels, energy batteries, low-energy light bulbs, or even the chance to go completely off-grid.
And if you’re not in a position to build but are considering making an offer on a house that happens to be a modular home? These advantages still apply. You’ll enjoy the high-quality materials and craftsmanship, the energy efficiency, and you’ll have the same opportunities to finance as if you were looking at a site-built home, thanks to the proper foundation and the fact that modular homes are considered permanent structures.
Modular homes undergo the same appraisal process as site-built homes — with regard to age, materials, location, size, and condition of the home — so not only are financing requirements comparable, but so are property taxes and homeowner’s insurance.
What are the disadvantages of a modular home?
Wondering if there’s a catch? While it’s true that these houses have plenty of arguments in their favor, it’s only fair to also consider some of the potential drawbacks of building or buying a modular home.
Modular homes still carry a stigma
Though this may not be a personal concern if you’re on the cusp of building a new modular home, it’s something to bear in mind should you plan to later sell the property. This is where it’s key to work with a great real estate agent who can educate potential buyers and strategically market the home.
“Most people don’t know the difference between modular and a steel-frame mobile home,” says Reeds. “The connotation is the same, and this tends to negatively impact resale value. You’ll need an experienced agent to differentiate.”
Buying an existing modular home may call for renovation
Reeds notes that much of the negative association with modular homes comes from the early days of prefabricated housing, when cost was king and manufacturers had to draw in customers by being substantially cheaper, which meant paring down on the quality of materials.
Even so, those issues were cosmetic, not structural. If you’re looking at a modular home that has been built since the Y2K scare, the interior components — such as doors, trim, and cabinetry — may look outdated or low-budget, but the bones are solid and renovating a modular home can be as straightforward as any other upgrade project.
“Once you’ve upgraded the cosmetics, you’re not going to be able to tell the difference from a site-built home,” says Reeds.
If you’re building, you’ll need to purchase land
While your agent can help you find the perfect lot for your new modular home, it’s important to be aware that not all areas are zoned for these homes due to their unique assembly. Before making an offer on a piece of land, be sure to check local zoning ordinances or HOA covenants.
A modular home purchase price is not all-inclusive
Remember that while modular homes are efficiently produced and can be a cost-effective option for building a new home, you’ll still need a foundation poured. You’ll also need to arrange electrical, plumbing, and duct work.
Finally, while your financing options will indeed be on par with those for a site-built home, getting a mortgage for a modular home may take a bit of creative legwork, particularly if your lender is unfamiliar with these types of homes.
Are modular homes the wave of the future?
With the modular construction market projected to grow 7.1% from 2018 to a 129-billion dollar industry by 2023, there’s no denying the increased demand for efficient, affordable, quality home construction.
Love them or leave them, innovative modular homes are certainly worth a conversation!
Header Image Source: (Wynand van Poortvliet / Unsplash)