Are you wondering about modular home prices? Will the price and fees be less than that of a traditional home? Will I end up spending less money overall?
These are common questions many potential home buyers want to know.
If you are considering new construction, modular homes are an option. Also known as a prefab home, It is a type of property that is becoming increasingly popular, and for good reason.
Modular home pricing is often less than traditional construction. You can expect to pay around $80 per square foot on the lower end and $200 per square foot or higher for more luxurious models.
However, prefabricated properties are not a new phenomenon. Design and construction methods have changed significantly since being first popularized around a hundred years ago.
Modular home builders have perfected the quality over the last decade or so.
But how much are modular homes to build, and what else must you understand when choosing this property type? The cost of a modular home can vary, but it is often less expensive than traditional methods.
From many years of experience selling real estate, many homebuyers are suprised by modular house costs. Homeowners can end up spending much less when compared to the expenses of a traditional house.
You might also be surprised by how much a modular home costs. Before buying a modular home, we will consider the essential things to know.
What is a Modular Home?
A modular home, also known as a prefabricated home, is a type of house that is constructed off-site in a factory-like setting.
Unlike traditional stick-built homes built on-site, modular homes are built in sections or modules, transported to the desired location, and assembled on a permanent foundation.
The construction process of a modular home involves using advanced manufacturing techniques and quality control measures.
Each module is built to the highest industry standards, ensuring precision and consistency in the construction process. The modules are typically constructed using components such as walls, floors, ceilings, and roofs, which are built separately and then assembled to form a complete home.
One of the critical advantages of prefab homes is their efficiency in terms of time and cost. Since the construction of modules takes place in a controlled environment, delays due to weather conditions or labor shortages are minimized. This results in a quicker construction process, allowing homeowners to move into their new homes sooner.
Quicker Construction Process
Additionally, modular homes are often more cost-effective compared to traditional homes. The streamlined construction process and bulk purchasing of materials in the factory setting can lower costs. Moreover, the controlled environment of the factory ensures minimal waste and efficient use of resources, making modular homes more environmentally friendly.
Modular homes also offer flexibility in design and customization. Homebuyers can choose from a wide range of floor plans, architectural styles, and finishes, allowing them to create a home that suits their needs and preferences.
The modular construction process also provides the flexibility to add or modify modules in the future, making it easier to expand or remodel the home as needed.
Being in real estate has allowed me to see how far along the perception of this housing choice has come. Years ago, there was a negative perception that no longer exists.
In conclusion, modular construction is a modern and efficient alternative to traditional stick-built homes. Modular homes have become popular for many homeowners looking for a high-quality, affordable housing solution with shorter construction time, cost-effectiveness, customization options, and environmental benefits.
Essential Facts to Know on Modular Home Prices
1. Modular homes are prefabricated houses constructed in sections or modules in a factory.
2. The price of a modular home can vary based on factors such as size, design, complexity, style, location, and customization options.
3. On average, a modular home’s cost per square foot is typically lower than traditional stick-built homes.
4. Additional expenses such as delivery, foundation, and site work should be considered when estimating the total price of a modular home.
5. Modular homes can offer cost savings and faster construction timelines than traditional on-site construction methods.
6. The materials, floor plans, and finishes can be customized today like stick-built homes.
7. Modular homes have seen a 35% increase in popularity over the past five years.
8. Modular projects can be constructed up to 50% faster than traditional stick-built homes.
9. The resale value tends to increase by an average of 15% within the first five years of ownership.
How Are They Different?
Modular homes are constructed in factories instead of on-site, like traditional homes. The modular sections are then shipped from the factory to the lot, where they will be assembled. There is still some work to finish the home after assembly, but around 90% of the home is built in the factory.
There are many differences between stick-built and modular houses. You can see a complete review to get more in-depth information.
Modular homes shouldn’t be confused with mobile homes. Mobile homes are constructed in a factory and transported to where they will be used. Mobile homes can be moved again when required, as foundations don’t hold them down.
On the other hand, a prefab house or modular home has a permanent foundation.
How Much Do Modular Homes Cost?
How much does it cost to build a modular home? Pricing of modular homes is likely different than what you expect.
Thanks to the many choices in modular home design, the costs can also vary greatly. If you are looking at building a small modular design, it could cost around $80,000. Larger modular home prices could be as much as $500,000 without the cost of the lot.
When you are looking at these types of properties, there are two main modular home prices you need to know about:
- The base model cost includes the modular sections, delivery, and assembly.
- Finished cost includes building the foundations, connecting utilities, driveways, landscaping, deck, patios, permit fees, and any other costs required to complete the home.
The more important figure is the finished cost since you need foundations and utilities, and building the home without permits isn’t going to go well. These additional costs cannot be ignored when considering constructing a modular home.
Average base model costs are around $120,000-$150,000, but with the finishing costs, this is around $270,000-$300,000. Like other types of construction, the base price will be significantly different than the overall cost after extras.
Average prices of modular builds will go way up with custom homes. The cost of a base unit will be different than when it’s loaded with extras and custom features. The cost of building always goes up with customization. It is the nature of the beast.
Even so, the pricing of modular homes will likely be attractive compared to standard housing. See the cost to build a house for a look at pricing for stick-built construction.
The Cost of the Lot Is Omitted
When considering modular home construction, the land cost must be added. Depending on your location, the lot could be the most expensive part of the construction.
Land cost is always one of the most significant factors when pricing a new build.
New Jersey is one of the most expensive states for land, at nearly $200,000 per acre. Whereas Wyoming offers the best value at around $1,500 per acre. You can also get cheap land in Northern Maine.
However, the location within the state will make a large difference in the cost, with urban areas costing more than rural ones.
Most of Massachusetts also has a high acquisition cost for land. It will be essential to research buying land and getting land loan financing before purchasing a modular home.
Additionally, land development costs can fluctuate significantly from one area to another.
The total cost of land preparation can vary quite a bit, even from lot to lot. Site work will be a significant variable in the final cost.
For example, is a town sewer available, or do you need to install a septic system? Installing a septic tank and leach field is usually more expensive than a city sewer hook-up fee.
How long is the driveway? Does the land have a high water table, making additional fill necessary? Are there numerous trees to clear? Land clearing and site prep are significant expenses that should be planned for.
From three decades of experience selling homes, many people underestimate site preperation costs. Utility connects and site prep can put a serious dent in your wallet when you’re not well versed on home building.
The cost of modular homes will be challenging to pin down without knowing the land development costs. One building site may be costly, while another may not.
The land cost often determines final modular home prices.
Don’t Forget Transportation Costs For Modular Housing
While a home’s square footage and the added custom features will play a significant role in modular pricing, don’t forget about transportation costs.
Getting the home from the factory to the job site will be another cost consideration. Costs can vary from one area to another, but $5 per square foot is a good rule of thumb for rural areas.
Other factors that can play a role in modular prices include the distance from the factory, the square feet of the building, and whether modules need separate shipments.
Can You Afford The Prices?
In general, mortgage payments are higher than rent. And when you own a home, the maintenance cost will fall on your shoulders, along with other costs.
You will pay the property taxes as part of your monthly mortgage payments. Private mortgage insurance premiums must also be paid if you haven’t put 20% down.
You might not have been responsible for other renting costs, like utilities, internet and cable, garbage, etc. All these costs must be factored into your calculations to see if you can afford a modular home.
If your calculations show you can afford to construct this type of home, you must find a suitable mortgage lender. Many different mortgages are available, and some will be more suitable.
Do you want a fixed-rate or adjustable-rate mortgage? How long a term do you want? These are questions to think about.
When you find the home loan right, mortgage preapproval is the next step. Your lender will review your financial and employment information to determine the maximum loan they can offer. You will be asked for information to confirm your income, like pay stubs and tax forms.
With your income confirmed, the lender can approve you for the loan. And with preapproval, you will know how much you can spend on a modular home.
When you have been pre-approved, your lender will give you a pre-approval letter that you can use to show to sellers when buying a home or land.
Are There Many Styles Available?
It is easy to assume that all modular homes look alike, but this isn’t the case. Many different designs, sizes, and styles are available to meet your needs.
Picking your floor plan won’t be a problem. You will end up with a unique property with the layout you need for your family.
Manufacturers offer hundreds of different layouts, and some customization may also be offered. Hundreds of designs were available in the early days of prefabricated homes.
In the 1930s, Sears had at least 370 designs of modular homes.
Like typical housing, the design will impact the prices of modular homes. If your requirements are extravagant, plan for the expenses to increase.
Vet The Builder When Building a Modular House
Just as you should vet the builder when buying traditional new construction, you should do the same with a modular home. There are many different modular builders to choose from.
Without a doubt, there will be good and bad companies. It will be vital to do your due diligence.
Ask the builder questions to ensure you’re on the same page. The answers will likely go a long way towards determining your happiness at the end of the project.
You can expect the modular home prices to differ from company to company.
Remember, too, that building a custom home is always more expensive than a comparable spec house.
Do They Hold Their Value?
While you might expect this type of property not to keep its value like traditional stick-built homes, that isn’t the case. Modular homes should hold on to their value the same as other types of construction.
Modular homes should also last as long as other construction types. Your home shouldn’t lose its value as long as you maintain it. If the local housing market grows, modular home values in that area will also increase.
While initial modular home costs might be lower, don’t expect sale prices to be less than similar properties.
Do Building Codes Apply?
Regardless of where the home was manufactured, it needs to follow the building codes for where it will be assembled. All the same building codes apply, from the state and locally. Understanding that local building codes might differ from town to town or city to city is critical.
Building permits must be taken out locally, just like stick-built houses.
Modular vs. Manufactured Homes: What is The Difference
Both manufactured homes and modular homes are types of prefabricated housing. Both are constructed in a factory setting with a controlled environment. Final assembly for a modular house is done on-site, whereas a manufactured home is done completely in the factory and then shipped.
Typically, manufactured homes don’t have the same customization as modular construction. Manufactured homes must conform to the HUD Code.
Buying Land to Construct Your House
To build a modular home, you must find some land for it. Would a piece of land with acreage, or would something more manageable be better?
Choosing the right real estate agent will help you find the ideal lot for your new home.
They should have some experience dealing with this type of purchase so that they will help you avoid buying the wrong piece of land. They will know to steer you away from a modular design bigger than your budget and ensure you don’t buy land at the wrong time.
Buying the wrong land could throw modular home prices out of whack.
Other Low-Cost Housing Alternatives
There are a few other lower-cost housing alternatives to a modular home. One is a tiny home, and the other is a shipping container home. Each of these properties has its pros and cons that are worth researching.
Container homes may not be allowed in some locations. Tiny homes might not have the necessary space needed for a growing family. Both should be well-researched before committing. Look at the cost of building a container home to get some comparisons.
Modular home pricing will likely be a bit more expensive than container and tiny homes.
FAQ
Here are some frequently asked questions on price and their answers.
What is The Average Cost?
The average cost of a modular home can vary depending on several factors, such as size, location, and customization options. However, based on recent data and trends in the housing market, the average cost of a modular home is estimated to be around $150,000 to $250,000.
This price range includes the basic construction and installation costs, but additional expenses such as land purchase, permits, and site preparation should also be considered.
It’s vital to note that these figures are approximate and can vary significantly based on individual preferences, manufacturers, customizations, and regional variations.
What Factors Influence The Price?
Several key factors influence the price of a modular home. The size and layout of the home play a significant role in determining its cost. Larger homes with more rooms and intricate designs tend to be more expensive.
The quality of materials used in construction impacts the price substantially. High-quality materials such as premium hardwood flooring or energy-efficient windows can increase costs.
Additionally, location plays a part in pricing as well. Modular homes built in areas with high demand or limited availability of land may have higher prices due to increased competition.
Lastly, customization options also affect the price range. The more personalized features and upgrades a homeowner chooses, the higher the cost.
Are There Different Pricing Options For Different Styles?
Yes! There are different pricing options based on the style you choose. Prefab homes come in many styles, including traditional, contemporary, farmhouse, and more.
Each style has unique features and design elements, which can impact the overall cost. Factors such as the complexity of the design, the materials used, and the level of customization required can all contribute to variations in pricing.
In addition, certain styles may be more popular or in higher demand, leading to potential price differences. It’s always recommended to consult with a reputable modular home manufacturer or builder to get accurate pricing information for your desired style.
Final Thoughts
A modular home can be a good housing choice for many folks. The average modular home will be cheaper than a traditional house for the same size and features. The pricing on a modular home might fall right in line with your budget.
Make sure you do your homework before committing to this type of project. Always consult a real estate attorney before signing a contract to build a modular home.
About the Author: Bill Gassett, a nationally recognized leader in his field, provided information on modular home prices. He is an expert in mortgages, financing, moving, home improvement, and general real estate.
Learn more about Bill Gassett and the publications he has been featured in. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-625-0191. Bill has helped people move in and out of Metrowest towns for the last 38+ years.
Are you thinking of selling your home? I am passionate about real estate and love sharing my marketing expertise!
I service Real Estate Sales in the following Metrowest MA towns: Ashland, Bellingham, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Natick, Northborough, Northbridge, Shrewsbury, Southborough, Sutton, Wayland, Westborough, Whitinsville, Worcester, Upton, and Uxbridge MA.
Very informative article, Bill. Thanks!!!