Modular structures have many benefits over other prefabricated home types

Intending homeowners have a variety of homes to choose from these days, from tiny homes to prefab homes. If you are the type that prefers custom-made houses but wouldn’t want to put in the expense and time in managing construction workers, engineers, and architects required to build one, you might want to consider modular homes. 

As a better alternative to the traditional design-and-build house, modular homes are cost-effective and time-saving. Although modular structures have been around for a while, they have become more popular lately due to increasing interest in green homes and soaring construction costs. 

So what is a modular home, and should you buy one? Here are some pros and cons to consider.

Modular Home Explained

Unlike a spec home built on-site, a modular house is constructed off-site in sections at a factory. After completing the segments, they’ll be transported to your designated land and assembled. 

Modular home construction takes half the time it’ll take to build a traditional home due to its efficient and streamlined building process. They’re also eco-friendly since they generate less waste and cost less than site-built houses. 

Like a stick-built house, you can customize modular homes to suit your design preferences and layout. You can also add a second-story or basement to your modular home.

How Modular Homes Look Like

Like new construction houses, modular home floor plans and blueprints differ depending on the overall budget, lot size, regional norms, neighborhood regulations, and customer needs. Depending on your preference, your modular home design can be traditional, ultra-modern, or rustic.

Due to modular homes’ easy customization, manufacturers have architects that work with the homeowner to adapt floor plans to their individual needs and wants. Modular homes can accommodate your needs, whether considering expanding to a 3,000-square feet house with two floors or downsizing to a small studio apartment-like home. 

Modular Vs. Manufactured Home

Now that you’ve gotten the answer to the question, what is a modular home? It’s time to compare it to similar prefab home types, like manufactured structures. 

Although both manufactured houses and modular homes construction happen in factories, they have some differences. Modular homes are built in sections, shipped through trucks, and assembled at their final destination. 

They have a permanent foundation and might even come with a crawl space or basement. They’re insured and taxed like regular stick-built homes and might likely appreciate at the same rate. 

On the other hand, manufactured homes are completed and assembled on the factory floor. They’re transported on a vehicle with wheels and therefore referred to as mobile homes. Some owners of manufactured homes sometimes leave the house on the movable chassis the builder constructed it on rather than set it on a foundation like a modular home. 

In this case, the homeowner will pay an annual fee to the Department of Motor Vehicles rather than property taxes. Also, it might be challenging to obtain financing if you’re considering a manufactured home because the house isn’t permanently fixed, and most lenders don’t see it as real property. 

Even if a manufactured house is fixed on a foundation, it won’t still appreciate the same way as a stick-built or modular home. Nevertheless, it’d be best to go for a manufactured home if you’re on a limited budget, as it’s cheaper than modular homes. 

You can add another story or even a basement on your modular building

Differences Between Modular Homes and Houses Built On-site

Modular home construction happens indoors and, therefore, could be finished in weeks rather than months like on-site houses. They aren’t affected by usual on-site delays caused by weather and other occurrences. 

Also, modular homes conform to specific building codes, guidelines, and rules more than traditional on-site houses like carriage homes. However, when opting for modular homes, consider shopping around to find the best company that constructs factory-built homes. 

Doing your research will help you discover significant differences in their service, price, and quality. 

Advantages of a Modular Home

Besides the easy adaptability and customization of the modular homes construction process, you get to enjoy additional perks of becoming a modular homeowner, such as: 

  • High-Quality Construction 

Despite being cost-effective, modular homes are pretty sturdy, and the manufacturers use high-quality materials. The Institute for Business and Home Safety report showed that modular homes stand up to high winds more than stick-built homes. 

Builders design modular structures to meet all local and state building codes like site-built houses. Professionals also inspect the building process to ensure top-quality construction. Once adequately maintained, it can outlast traditional homes. 

  • Faster Building Process

One significant advantage of modular homes is the fast construction process. Because the construction happens indoors, factors like adverse weather conditions won’t cause any delay, speeding up the construction process. 

Modular houses require 50% less time for completion than site-built structures, meaning that your home can be ready in two months. 

  • Cheaper Than Site-Built Homes 

If you’re on a budget, modular homes are your best bet. Although they resemble stick-built houses, you get to save about 15% to 20% of the cost of building traditional structures. 

Modular homes are cost-effective because they require less building time, so their manufacturers don’t spend too much on labor costs. Also, they buy the building materials in bulk, lowering the unit price and passing over the savings to you. 

  • Environmentally-friendly

The modular home sections’ fabrication efficacy helps reduce overall construction waste and excess materials. Due to the remarkable construction quality, housing experts believe that modular homes operate 15% more efficiently than on-site houses, helping you save money on annual cooling and heating costs.

Due to the customization option, you can design your modular home with self-sufficiency in mind by adding low-energy light bulbs, energy batteries, and solar panels. If you buy a modular home rather than build one, you’ll still enjoy these advantages. 

Besides the high-quality materials, energy efficiency, and quality craftsmanship, you also enjoy the same financing opportunities as site-built home buyers because modular homes have a proper foundation and are regarded as permanent structures. 

Like site-built homes, modular houses undergo the appraisal process to determine the home’s condition, size, location, material, and age. Therefore, besides the comparable financial requirements, the homeowner’s insurance and property taxes are the same as on-site homes.

Disadvantages of a Modular Home

After getting the answer to the question, what are modular homes and examining their pros, it’s only fair that we also look at potential drawbacks to this housing type. Which include:

Most people are still not open to building or buying a modular structure

  • Unpopular Housing Type

If you intend to sell your modular home later, you’ll need to understand how most home buyers see this type of property. As a not-so-popular property type, most people can’t differentiate between a steel-frame mobile home and a modular house, negatively impacting resale value. 

Therefore, it’d be best to work with an experienced real estate agent from Homes By Ardor to market the house and educate potential buyers strategically. 

  • Less Customization 

Although you have the freedom to customize your modular home to your taste, there are limits to what the factory can build for you because the sections have to be small for easy transportation on flatbed trucks. 

The bottom line is that you might not get some architectural features you’d want. For instance, if you prefer large rooms with high ceilings, it might be impossible to get that feature in a modular home.

  • Older Modular Homes May Require Renovation

Most people shy away from modular homes due to prefabricated housing’s early days when houses were expensive, and builders drew customers with substantially cheaper alternatives like modular homes. However, this means that the builder might have reduced the construction materials’ quality. 

Regardless of the quality reduction, the issue with older construction homes is purely cosmetic and not structural. While the interior components like cabinetry, trim, and doors might look low-budget or outdated, the structures are solid, and renovating it can be as simple as upgrading any other type of site-built house. 

After the cosmetic renovation, it’ll be difficult to tell the difference from an on-site home. 

  • Zoning Restrictions

When shopping for potential building sites, don’t forget to check for local zoning restrictions, as some locations don’t allow modular homes. That way, you don’t end up building a house you can’t live in. 

Therefore, it’d be best to ask your local real estate agent to help you find the perfect land for your modular home. However, keep in mind that some areas aren’t zoned to modular homes due to how they’re assembled. 

Ensure you check HOA convenience or local zoning ordinances before buying a piece of land. 

  • Purchase Price Isn’t All-inclusive

While modular homes are cheaper than site-built homes, you still need to factor in other expenses, including the land and laying the foundation. You also need to pay for ductwork, plumbing, and electrical wiring. 

While your financing options are the same as site-built home buyers, finding a mortgage lender familiar with prefab homes and willing to give you a mortgage for building your modular home might take a while.  

Modular Homes Average Price

Most homebuyers work on a limited budget, so you might want to know the modular home price. A modular home’s base often costs between $50 to $100 for each square foot, and manufacturers usually charge about $30 to $60 additional fee per square foot for its installation. 

However, if you’re considering designing your modular home from scratch rather than using an existing floor plan, you’ll spend between $100 to $250 for each square foot. Don’t forget to include the land cost in your budget. Depending on the land price in your preferred area, you can estimate the price to be about $12,000 per acre on average. 

Many financing options exist for modular property buyers and builders

Obtaining Financing for Modular Homes

Modular homeowners can qualify for conventional mortgages like townhouses and condo buyers. However, most builders require upfront payment, or the money is paid in stages while the construction is ongoing. 

As an intending homeowner, it’s best to get a construction loan. After building the home, you can convert it to a mortgage. You also need to buy the land for building the house. While some lenders permit you to include the land cost in your construction loan, others don’t so do your research. 

You might want to assess a land loan to finance your purchase or buy it in cash. 


How Much Down Payment Do You Need On a Modular Home? 

To ensure your loan for building a modular steuctu gets approved, you might need to drop at least 20% of the house value. A higher down payment increases your chances of getting approved. 

Is a Modular Home the Same as a Prefab Home?

A modular home is a type of prefab house like a manufactured home. However, it’s better than most prefab houses because you can get financing for building them, unlike manufactured homes. 

Do Modular Homes Last?

Modular homes can last longer than traditional on-site homes because the manufacturers build them according to local zoning regulations and codes. In some cases, it outlasts traditional houses. 

Final Words

Despite the stigma associated with modular homes, they’re becoming an increasingly popular choice for home buyers. They’re cheaper than site-built homes, can be easily customized, and are environmentally friendly. What’s more, they’re often faster to build and can last just as long as traditional homes. 

If you’re interested in buying or selling a modular home, it’s important to do your research first. Check for zoning restrictions in your area, and be prepared to put in a little extra effort when finding a mortgage lender. With the help of an experienced real estate agent, navigating the world of modular homes becomes easy now that you’ve gotten the answer to your question, what is a modular home?

Buying or selling a modular home is tasking compared to traditional home real estate transactions. As a seller, you need to work with an experienced real estate agent that will help you market the property and educate potential buyers. 

Homes By Ardor has the best team of real estate agents to get the work done. Whether you’re interested in buying or selling any type of prefab home, our knowledgeable realtors are available to help you have a stress-free transaction process.  

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