If you’re looking to purchase a new home, a prefabricated house is a fantastic way to get the home of your dreams at a lower cost. If you have some misconceptions about modular homes, this pros and cons list should help you decide if a prefab home is for you.
Pros
- Energy Efficient: Modular homes can be made to be much more energy efficient than traditional homes. Energy Star certifies some prefabricated homes with high-performance windows, tight construction, and energy-efficient heating/cooling equipment. Plus, you can customize your home to have solar panels, which can give you a 30% write off on your taxes.
- Constructed Quickly: While the time it takes to build a prefabricated home varies, it’s still much shorter than it takes to build a traditional house. Rather than being built outside, prefabricated homes are built indoors, which keeps issues like weather from halting construction. A modular home can be constructed anywhere from a few weeks to a few months.
- Extremely Durable: Prefabricated and modular homes are built to endure transportation and movement by a crane, which means the quality needs to be top-notch. Because of this fact, your home may be stronger than traditionally built homes. In fact, FEMA even suggests that modular homes are sound enough to withstand a hurricane.
- Completely Customizable: Despite most preconceptions, prefabricated homes are completely customizable. Some companies even allow you to choose where you want rooms to be. For an extra price, you can opt-in for a garage or a porch. You can even decide varying styles for your home including ranch, two-story, colonial, and modern.
Cons
- Land Costs: The biggest expense for modular homes is your plot of land, which can cost anywhere from $1,000 to over $100,000. The price depends on the location, but there may be additional costs such as leveling the ground to ensure a stable foundation and adequate utility hook-ups. A good real estate agent can find a suitable land plot, but it will take a chunk of your budget.
- Higher Up-Front Payment: If you buy an existing home, you make a down payment toward your mortgage, and you can live in the home while making monthly payments. However, general contractors and manufacturers must be paid in full before construction on your house can even begin. Mortgages are available for prefabricated homes but don't expect building to start before payment.
- Land Restrictions: Some neighborhoods have building restrictions that don’t allow you to have a prefabricated home. Other neighborhoods allow modular homes, but only certain types. Before you get one of these homes, you’ll have to do adequate research to determine whether you can put your home on the land you intend to purchase.
- Complicated Loan Process: Some lenders have a misconception that prefabricated homes are a "manufactured home." These are two different types of residences. A manufactured home is not affixed to a permanent surface and is also called a "mobile home." This misconception can make it difficult to get a proper mortgage for a modular residence.
