Is Modular Right for You?

Here is our team Owner, Quinn Beversluis, talking about Modular Homes.

Is a Modular Home Right for You?

by Joanne DiMaggio

The phrase “modular home” is one of the most misunderstood phrases in the housing industry. That’s because terms bandied about such as “mobile home,” “doublewides,” “pre-fab,” “panelized,” and “pre-cut” have the public scratching their heads wondering, which is which? While some believe they are all one and the same, Quinn Beversluis, a REALTOR® working with I&J Home Builders in Troy, says these various terms do not necessarily describe the same type of structure.

“There are many terms out there that people get confused with and they are very different indeed,” he explained. “’Mobile,’ ‘doublewides,’ ‘manufactured,’ all refer to homes built on a frame. There are even some companies now that are calling their homes ‘on frame modulars.’ To get away from all the confusion, I&J and its partners are going toward the term ‘systems-built homes,’ again since the term ‘modular’ has been blurred by so many over the years.”

John Quale, Assistant Professor at the University of Virginia School of Architecture, LEED AP, and Project Director of ecoMOD, a research and design/build/evaluate project that is creating a series of ecological, modular, and affordable housing units (see sidebar), says the word “modular” has several meanings, even within the world of prefabricated construction.

“In the broadest sense, modular refers to standardized units, so it can generally refer to anything with repetitive dimensions – from small components to wall or roof panels,” he explained. “However, modular also has a very specific technical meaning within the prefab world: a volume (i.e. box or module) prefabricated off-site in a factory, and transported to the site on a trailer.”

Quale said that in concept, modular homes are somewhat similar to manufactured housing (also known as trailers or mobile homes) but they are actually quite different.

“Manufactured housing/trailers/mobile homes are not considered permanent buildings,” he said. “They have a steel chassis integrated into their floor structure so they can be moved at any time. Because of the temporary nature, manufactured homes are more difficult to finance in a conventional way, and they depreciate in value like a car. Modular homes are placed on permanent foundations and are essentially the same as site-built homes. Many of them are superior to spec homes.”

Beversluis admits there are stigmas associated with modular homes, all of which are unfounded.

“One of the greatest misconceptions is that they are inferior,” he says. “Many people equate modular homes with manufactured or mobile homes, and there is an assumption that there are limited choices regarding the design of the house. The ability to fully customize the house is one of the distinctions between modular and manufactured housing. At the start of the industry, modular designs were basic. Today, they can be built to any specification, from a single-story ranch house to a two-story with walk-in attic; the choices are virtually unlimited.”

Quale agrees. “Many people think modular homes are poor-quality construction. This is not necessarily the case. Most modular homes are comparable to a home built by a developer on site – and in fact, it is almost impossible to distinguish a modular home from a site-built home without a detailed inspection of the framing of the home.”

Another misconception is that modular homes are expensive and attract higher insurance costs.

“Comparatively, modular homes are less expensive than site-built homes and insurance costs are the same as that of an on-site home,” said Beversluis. “In many instances, the appraisals come in considerably higher than the purchase price and the buyers have the benefit of a lower loan-to-value ratio, which in essence is money in their pocket.”

Beversluis says modular homes are generally 20-30% less expensive than “stick-built” homes. In Central Virginia, the average building cost for a traditionally built home ranges from $115 to $125 per square foot. The modular homes I&J sells average $80 – $85, with some as low as $69 per square foot, and that is with I&J standards of 2’ x 6’ exterior walls and appliances included. In addition, Beversluis says modular homes undergo the same building inspections as traditionally built homes.

“A modular home conforms to the building codes that are required at the specific location it will be delivered to, and in many cases construction exceeds the required codes,” he explained. “Modular homes are built using the highest quality materials in a controlled and enclosed environment. They undergo more thorough and stringent inspections, which are carried out by a third party.”

But What Do They Look Like?

One of the biggest misconceptions about modular homes is that they aren’t as attractive as traditionally built homes. In truth, modular homes look just like traditional custom-built homes. The big difference is that they are pre-built at an off-site, climate-controlled factory while the site preparation work is being done, thus saving time and money. The sections are assembled on-site, using the same methods as stick-built homes. Local builders apply the finishing touches to produce homes that match the quality and appearance of traditionally built homes.

Beversluis added that consistent quality control is maintained throughout, as each employee is a specialist in his craft. “You wouldn’t have your roofer doing your finished trim work at the factory,” he said.

In addition, on average a modular home uses approximately 25% more lumber, producing a more energy-efficient home. What’s more, modular homes appreciate in value the same as site-built homes.

“They have come a long way from the ’80s and ’90s,” said Beversluis. “Designs are now far more complex than in those earlier days. Virtually anything is possible.”

Lower cost means customers are able to add options they may not have been able to afford with a traditionally built home, such as a basement, multi-levels, extra bedrooms, increased energy-efficiency, and insulation. Far from a cookie-cutter house, modular homes are fast becoming a buyer’s dream home.

Applying Green Standards

While modular home manufacturers are looking at building to greener standards, Quale says the principles of green design are not as common in the modular housing world as they are with custom site-built homes.

“Some conventional modular builders might offer an ‘Energy Star’ model, but that is a pretty low threshold of sustainability,” Quale says. “Some of the higher end, contemporary modular home options are pushing green design somewhat. Like so many things in green design today, there is a lot more hype than reality. It’s only a matter of time before we start hearing that modular homes are inherently more sustainable than something built on-site. I’m a major supporter of modular homes and prefabricated construction in general, but I’d be suspicious of people that take these claims too far. While modular companies do not waste a single stick of lumber (unlike the wasteful practices of many homebuilders), they also use more lumber per house (to ensure the structure is sturdy enough to be craned onto a trailer and travel 60 miles per hour). There are many possible advantages of off-site versus on-site construction, but there isn’t any proof of these yet.”

Nonetheless, Beversluis said that modular homebuyers are being offered environmentally friendly options from lighting, flooring, and paint to countertops, lumber, solar heating, etc.

Beversluis cited studies that support Quale’s statement that there is less waste during the construction of a modular home, primarily due to the recycling of lumber and greater accuracy in cuts.

“Waste materials are minimized, and the waste generated is much more easily reused and recycled in a factory environment,” he stated. “Homes are built in controlled facilities, where tolerances are tighter and structures have less air infiltration, resulting in more energy-efficient homes. During construction, materials are stored in these facilities, which result in less waste from weather damage and theft. The efficiency of the modular manufacturing process reduces CO2 output compared to traditional site construction. Off-site construction also reduces on-site noise, dust, debris, and traffic with less bother to neighbors.”

Modular homes offer a number of other advantages—they can be built faster (usually within three weeks), weather delays are never an issue, and budgets are more easily controlled and dependable.

“Being built off-site in a controlled environment dramatically reduces reliance on subcontractors, which also results in tighter project control,” Beversluis said.

“Manufacturers have engineers working for them so designs can be accommodated, whereas stick-built companies would need to get engineers to change these plans. Factories all carry an extended warranty on the house as opposed to traditional builds, which carry a one-year warranty. On-site built homes are subject to weather exposure that can lead to future water damage problems and mold issues. Modular homes are often structurally stronger than traditional site-built homes due to the fact that additional framing and structural support is built into the module designs so they can withstand transportation load factors.”

While Quale agrees that modular homes are very similar in quality to traditionally built homes, he says that claim only goes so far. “Some modular builders claim they are superior quality because there are built in climate controlled conditions, and have additional structure for transportation. That additional structure might make the home a bit stronger, but does nothing to improve the thermal performance.”

According to industry statistics, modular construction projects have more than doubled in the last 10 years. Beversluis says his business has “grown tremendously” over the last decade, and credits the increase in popularity of modular homes is due in part to the efficiency of building with the modular process. “It just makes sense—the purchasing power in volume, and the use of efficient factory procedures, combined with the technology of today.”

Questions To Ask

As with any major project, consumers interested in purchasing a modular home should do their homework and ask questions. Beversluis says customers should be aware of the builder they choose and the specs of the exact home they are purchasing. “You want to compare apples to apples when dealing with price,” he advises. “Many builders require their customers to be the general contractor, obtain permits, carry insurance, etc. This can be a daunting task for the average homebuyer. Also, utilize the companies that provide computerized design with virtual tours so you can see exactly what you are building.”

Many modular home companies, such as I&J, are one-stop shopping operations, meaning they will locate and buy land on a client’s behalf; provide a construction loan; and do all the title work, survey, perk testing, building permits, inspections, site work, etc.

If you choose not to work with a “one-stop shop,” Quale advises it is best to hire a local builder to install the foundation and utilities and select someone that has worked with a modular company before. “The modular home companies typically only provide the modules, and depend on local builders to complete the last 5-10% of work on the modules (finish work where the modules come together) and the foundation and site work.”

Beversluis said I&J is happy to work with REALTORS®. “In fact we encourage them to bring us clients that they cannot find the right home for,” he said. “It is sometimes easier and cheaper to start with a new design than to find the perfect existing property. ”