Even though modular homes offer lower construction costs and faster build times, many first-time buyers overlook expenses like permits, utility connections, and delivery. An experienced modular home builder can help you navigate financing, zoning laws, customization opportunities, and construction logistics. However, don't assume that they offer an all-inclusive turnkey price and complete design freedom.
The NerdWallet reports that nearly 1 in 7 Americans (15%) plan to buy a home in the next 12 months. With housing inventory still tight and traditional construction prices climbing, you should consider turning to modular if owning a home is your dream.
Knowing how the process works can save you a lot of money and months of frustration. The right manufactured home dealer will help turn a stressful build into a smooth home purchase.
Why Are Modular Homes Gaining Attention?
As reported by Construction Coverage, over 22 million Americans live in modular homes. A lot of homeowners love these homes for the following reasons:
Affordability
If you're looking for affordable housing, modular homes are your go-to. Unlike traditional homes, these homes cost less to build and buy. The factory construction of these homes allows for bulk purchasing of materials, reducing your costs.
Speed of Construction
Time matters when you're building your home. The building of prefab homes takes a fraction of the time used to construct conventional homes. This process can help you reduce the whole timeline, allowing you to move into your new space quickly.
Quality and Durability
Since they're made in a factory, your modular homes get better quality control. As a result, your modular home features higher levels of durability.
Eco-Friendliness
As an eco-conscious homeowner, you should consider a modular home. These homes use renewable materials and energy-efficient features. A lot of prefab home manufacturers also focus on sustainable building practices, helping reduce waste and the carbon footprint.
What Is the Financing Structure of Modular Houses?
Modular homes have the same financing as traditional site-built homes once you place them on a permanent foundation. Since these are factory-built prefab homes, your lenders will want you to secure a mortgage preapproval and agree to a builder's draw schedule to release funds in stages.
You can finance your home with several mortgage loan lenders, including:
- VA loans
- FHA loans
- USDA loans
- Conventional mortgages
Securing mortgage preapproval early is non-negotiable. Most modular home builders will expect this before they order your home or start the permitting process.
What Many First-Time Buyers Often Misunderstand About Working With a Modular Home Builder?
If you want to own a modular home, you should know that it differs a lot from traditional stick-built homes. Here are factors that people often misunderstand:
Base Prices Aren't the Same as Total Project Costs
As a first-time buyer, you shouldn't assume that the attractive base price covers the finished home. The advertised rate usually just covers the manufacturing of the modules. However, you also have to pay for:
- Site preparation
- Foundation work
- Connecting to water, sewer, and electricity
- Crane and transportation to deliver and lift the modules onto the foundation
These services aren't part of the base price. You'll have to budget an additional 15% to 30% for these excluded costs.
The Customization Limits
Although a lot of companies provide custom modular designs, you can't always treat them like a traditional, fully custom site-built home. You won't be able to alter everything. There are structural limitations tied to factory efficiency that may make it hard for you to customize some elements in modular houses.
Here are some elements that you may be restricted from customizing:
- Roof pitch
- Ceiling heights
- Custom angles and curves
- Complex eaves and overhangs
- Custom window placements
- Hallway widths and room spans
If you work with Home Nation, you can mitigate some modular structural limits by getting access to more than 170 pre-engineered, factory-built floor plans. They will guide you to choose or lightly modify existing blueprints with factory-approved features.
Working With a Retailer vs. Licensed Builder
Many first-time buyers don't realize that some prefab home sales centers are strictly sales lots. They don't have licensed general contractors.
As a result, sales representatives may give you estimates for your home only. You'll often be left alone to deal with the costs of preparing the land, getting permits, logistics, and assembling your home on-site. If you want help every step of the way, always choose a licensed modular home builder.
Land Zoning and Suitability Needs
You don't need to own land before meeting with a builder. However, not every piece of land is ideal for modular construction.
If you want a seamless process, you must look into the local zoning laws. Also, confirm whether the route to your plot is clear enough for wide flatbed trucks and large cranes.
Frequently Asked Questions
Do Modular Homes Hold Their Value?
Yes, if you own a modular home, you can be certain it will hold value over time. These homes are eligible for standard mortgages, which will help you have a large pool of future buyers. A lot of buyers accessing your property helps you maintain your resale value.
The property your home sits on will appreciate over time, making it valuable. Proper maintenance will also ensure your house retains its structural integrity and market appeal.
Where Can I Find Land for My Modular Home?
To find land for your modular home, you can check with local real estate listings. You'll have to work with a real estate agent to make it easy for you to get a plot.
You can also find listings by looking at real estate websites and online platforms where people buy and sell property.
Are Modular Homes Safe?
Modular homes can resist fires, earthquakes, and hurricanes. Since they follow the same local, state, and federal building codes as regular homes, you can be sure of your and your loved one's safety.
Every home is inspected and vetted in the factory before it's shipped. This process ensures that the electrical, plumbing, and structural components in your home comply with safety regulations.
Build Your Modular Home With Confidence
Today, getting traditional affordable housing is very hard. Luckily, you can still own a home at a lower expense if you work with a modular home builder. Before you start, make sure you understand all the facts about prefab homes.
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