MODULAR VS MANUFACTURED HOME
Whether you have your dream home lot picked out or not, you have a big decision
to make. Do you want to have a custom home built on your lot, or do you want to
buy a modular home, or a manufactured home to put on your lot. Modular homes,
and manufactured homes, have come a long way in the last twenty years.
Today’s homes are much nicer quality, and more durable, so they are easier to get
a permit for, and to get a home loan on, depending on the type. You can also have
your home customized to your liking, just like you could with a custom home.
Both modular homes, and manufactured homes, are prefabricated homes that are
built fully, or partially, in a factory at the manufacturer. We will go over the main
differences in both types of homes below. Both homes are more affordable than a
standard home built entirely at your home site.
A big difference that sets the modular home apart from a manufactured home, is
that manufactured homes are built to the national HUD code, while modular
homes are built to all applicable state and local building codes. Because of this,
Modular homes are very similar to the way your standard stick built, or site built,
homes are built. This makes it easier to get a permit, loan, and insurance on the
home.
What Is A Modular Home?
A modular home is a home that is built on your lot, from modules that are made in
a factory, instead of being constructed at your home site. These parts are
transported to your home site, and assembled by your home builder. Many people
when they hear of modular home think they are simple and boring homes that
they just don’t want. However, this not the case anymore. They are made more
durable, and with better materials, so they are really nice these days and
becoming a more popular home choice than ever before.
Modular homes can come in any shape and size that you want. Many modular
home manufacturers have a hundred or more pre-designed plans that they offer
as their normal build options. They also let you customize your own, or make
customize one of their plans, to fit your needs. They have one story, two story, and
some even have three story homes available. They come in all sizes, starting at
under 1000 square feet, and go up over 4000 square feet. They can include a one
car, two car, or three car garage, as well as no garage at all. You can also add a
separate detached garage.
A modular home is permanent, and cannot be moved once it is built. A modular
home can be much larger than a manufactured home, which is what makes it
attractive to most buyers. A modular home, depending on the model you choose,
can look exactly like a standard stick built home.
What Are the Advantages of A Modular Home?
Speed
Modular homes, depending on how busy your manufacturer is, can typically be
built in about a week. If you pick a busy manufacturer, or if you have a lot of
customizations or bring your own design entirely, it can take up to months longer
than that. Weather delays are less impacted for the modular home building
process for the manufacturer piece as most builders build the components
indoors in their climate controlled factory.
Quality
Modular homes are higher quality than a manufactured home. A modular home is
more durable, and will last a lot longer than a manufactured home, and are like
the durability and quality of a traditional stick built home.
Construction Time
Modular homes are built in modular sections at a factory, and then they are
transported to your home site, and assembled pretty quickly.
Cost
Modular homes are cheaper to build than tradition on site stick built homes.
Customizable
Modular home builders have a lot of pre-designed models that they offer to build,
but they do have a lot of variety in style, materials, layout, and size. You can take
their plan, and customize to fit your needs, or you can bring your own design and
have them build it.
Energy Usage
Modular homes typically use less energy than the standard stick built homes.
Better Construction
Modular homes factories are subject to federal quality controls and standards, and
they are built to meet state and local building codes.
Look
Modular homes can look just like the traditional on site built home. If you want the
look and feel of an on site built home you will want to go with the Modular home
instead of the Manufactured home.
What Are the Disadvantages of A Modular Home?
Additional Costs
Modular homes don’t typically include the cost of the electrical, plumbing, and
ductwork as part of their base modular home pricing, so this will cost extra.
Resale Value
Some homebuyers believe modular homes aren’t built as well as traditional stick
built homes, and won’t hold their resale value. This belief, which is not a fair
reputation for these homes, may slow a home’s appreciation value and make it
more difficult to sell later down the road when you decide to sell.
What Is A Manufactured Home?
Manufactured homes are constructed using high quality materials inside of
climate controlled buildings. They are build according the the HUD Code. They
most often come in three sizes. Manufactured homes are what people used to call
trailer homes, mobile homes, or trailer park homes. They are built in the factory,
on a steel chassis like a vehicle, and delivered in one, two, or three pieces. You can
get a single wide, double wide, or triple wide home that can range in size from
under 1,000 square feet, to over 3,000 square feet.
Manufactured homes are commonly used for temporary housing, temporary
additional housing such as for taking care of a sick or aging relative like a granny
flat would provide. They are also used in retirement communites that are referred
to as a trailer park. Some people even use them to add a living space for their
children as they graduate into adulthood to give them the space they need to feel
as if they live on their own, but you or they aren’t quite ready for them to take that
next step of getting an apartment, or buying their own house.
If your manufactured home is on a pier and beam foundation you may be able to
have it moved to another home site. If you aren’t interested in relocating your
manufactured home, you can also have it put on a permanent foundation.
What Are the Advantages of A Manufactured Home?
Cost
Manufactured homes are usually cheaper to build than a modular home.
Portability
Manufactured homes are mounted to a steel chassis. Because of this they can be
taken back apart in sections and hauled to a new location.
What Are the Disadvantages of A Manufactured Home?
Resale Value
Manufactured homes depreciate in value over time just like a car would. Though
the home values go up based on the market, a manufactured home won’t go up as
much as a traditional site built home would.
Size
Manufactured homes can’t be as large as the modular homes can be as they are
limited in size by the steel chassis they are mounted on.
Durability
Manufactured homes are not built as strong and durable as a Module home, and
they don’t hold up as much to wear and tear, high winds, tornadoes, and
hurricanes.
Look
Manufactured homes are not as nice looking as a modular home in their look and
design. Their roofs are shaped less sloped and can even be flat like a trailer roof. If
you want the look and feel of a traditional on site built home, you would like the
Modular home better.
Loans and Financing
Modular Home builders typically require you to make up front installment
payments during the process of building the home. You can typically get a
construction loan to pay these costs. When your Modular home has been
delivered and built together on your home lot, you can roll your construction loan
into a traditional mortgage, just like a home that is completely built on site. This is
a huge advantage to buying a Modular home instead of a manufactured home.
Manufactured homes are sometimes viewed differently from the banks. You are
not always able to get a traditional mortgage on these. In order to get a traditional
loan for these homes, you have to own the lot or land that the home is placed on,
and you have to have the manufactured home titled as real property.
If your Manufactured home does not qualify for a traditional mortgage, the FHA
does offer FHA Title 1 Loans to finance your home. With these loans, the buyer is
permitted to lease the land where the home resides, such as in a manufactured
home community, or mobile home park.
Often manufactured home buyers will finance their home using a Chattel loan,
which is a direct form of financing for personal property, like a car loan.
Unfortunately you will have a higher interest rate in this type of loan than you
would have if you could get a traditional home loan.
The bottom line is that if you are wanting to have a home that has great resale
value, and will appreciate over time just like a regular traditional site built home,
where you want the same quality and durability, and would like to have a lower
interest Traditional Home Loan, then you should get a Modular Home.
If you want a second home on your land for friends, or family, or if you are retiring
and would like to move to a mobile home park or retirement community, you will
want to buy a manufactured home.
For all types of homes, before finalizing your decision, you should fully understand
the prices for all options, and complete setup or build out on your home lot. You
will want to understand the permitting rules or laws in your community to know
which type of home you are allowed to build or install. Lastly, you want to
understand fully what type of loans and what the rates would be with the different
options, so that you can decide on the right type of home for you, and not have
any surprised pop up that could slow down the process, or cost you more than
you thought.
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