In a nutshell, a modular home is a home that is built in sections inside a factory-type space, then transported in sections to the home’s site and assembled and completed on-site by the builder. Each section of the modular home moves through the factory setting, passing inspections under quality control after each step of construction. Once completed, these sections, called modules, are covered and protected then shipped off to their final destination. The modules are then assembled with cranes onto a pre-made foundation and joined together professionally, with other home construction requirements completed by a builder (such as plumbing, electrical, etc.).

What is a Modular Home ?

Some modular homes are very basic in design and, for cost effectiveness, end up resembling double-wide mobile or manufactured homes. This and the fact that the modules of modular homes are moved from one location to another make some people assume that modular homes are the same as mobile homes. This isn’t the case – modular and mobile homes are actually different. For example, once assembled on-site, modular homes are permanent in the same way a traditional home is permanent to the foundation. They are simply built in a place that is different than their final address – off-site, as opposed to on-site. Mobile homes can, at any time, be moved to another location entirely based upon their relatively temporary foundation.

Because of their construction beginnings in a factory-like, climate controlled environment, modular homes are also known by the names system-built homes, factory-built homes, and/or pre-fabricated (or “pre-fab”) homes. Their construction is considered to be a form of green building.

Modular Home Design

There is a huge variety in design options for modular homes. Just because modular homes are constructed off-site doesn’t mean that the homeowner lacks design options. In fact, modular homes can be customized in design; they vary in size and style just like on-site traditionally built homes. To facilitate the customization and quality of design, many modular home companies include services by an in-house engineering department utilizing Computer Aided Design (CAD). With that software, virtually any house plan can be converted into a modular home.

Some of the hundreds of customizable features in a modular home include solid-surface countertops, ceramic floors, various window styles, cabinetry made out of wood or other materials, plumbing fixtures, and exterior finishes and architectural details. This is certainly not a comprehensive list of options; each modular home manufacturer will have specific options available. Basically, a modular home can be completely customized because it really has no limitations on design.

Not only styled to taste, modular homes are constructed to be quite strong and durable. They can be built to withstand winds up to 175 mph! Modular homes can be designed for future conveniences and current accessible living. Essentially, these custom pre-fabricated homes are becoming more and more adept at blending into any neighborhood or location.

It’s important to note that, regardless of what the modular home looks like, it has been constructed to meet or exceed specific, strict building codes. In fact, due to the quality control processes throughout construction, the adherence to building guidelines or codes is often greater than that of traditional homes built on-site in that particular area.

Modular Home Cost

Bottom line: Modular homes can save quite a lot of money, generally speaking. This is due to several factors: First, they’re constructed efficiently and quickly, over weeks instead of months. Second, inspections are conducted throughout each construction phase and completed before the modular home is transported. That being said, however, it’s important to remember that modular homes can vary in price just as much as traditional homes can, depending on customization, materials, and complexity of design. Furthermore, electrical, plumbing, and duct work are excluded from the cost of a modular home’s construction, so the final cost of the assembled home could be about 20% higher than the construction quote.

For those looking to finance, you can get a home loan for a modular home just the same as for a traditionally on-site-built home. Similarly, insurance premiums and taxes for the two types of homes are equal as well.

Pros and cons of modular homes

Benefit of Modular Homes

Cost Effectiveness. Modular homes, due to modern CAD technology and capabilities, usually look very similar to a traditionally built home, but they are much more cost efficient to construct. This is largely because of the climate controlled factory environment, which allows for a much faster construction time without weather constraints. The more time it takes for a home to be built, the more expensive it will be.

Short Construction Timeframe. Because modular homes are built inside, they are not at the mercy of natural constraints or effects. Weather, temperature, humidity, wind – none of these really affect or ever delay the construction of a modular home, which means that a modular home can be essentially constructed in two or three weeks (average) versus months. Another two to four weeks should be budgeted for the builder to assemble the modules after delivery.

Similar Appraisal Value as Traditional Homes. Modular homes have been shown to have similar (read: practically identical) appraisal values as traditional homes built on-site. Because they’re permanent structures, they lack the transient stigma associated with mobile homes, and are actually considered to be “real property.” This, and the fact that modular homes appreciate in value rather than depreciate like their mobile home counterparts, means that financing is similar to traditional homes as well.

Can Incorporate Crawl Spaces and Basements. For those who live in climates where crawl spaces and basements are an advantage in the home, modular homes can accommodate those needs by being built upon either.

Variety in Design Options. Unlike mobile or manufactured homes, which are a come-as-it-is order, modular homes can be customized from the get-go stages of design throughout completion. From traditional styles to contemporary styles to everything in between, modular homes can meet any style specifications and aesthetics.

Easy on the Environment. Most modular homes are designed and constructed in such a way as to be energy-efficient, particularly with regard to windows and the quality of insulation. This reduces heating and cooling costs, which ultimately requires less energy demand to operate effectively, which is better for the environment overall.

Disadvantage of Modular Homes

Payment Required Upfront. A modular home requires the builder to be paid in full before the home construction is completed. This requires either a substantial cash reserve or a construction loan through a modular home dealer.

Significant Quality Spectrum. As is the case with construction in general, the market contains a wide variety of modular home providers in terms of quality and price. It is not a one-size-fits-all construction method. Research and shopping around are required to ensure that the final product meets your expectations.

Varied Wait Time. When compared to mobile, or manufactured, homes, modular homes tend to require a longer wait time until you can move in, because construction and assembly must be complete before move-in. However, compared to a traditionally constructed on-site home, the modular home wait time is less because of the quicker construction time overall.

Land Ownership. Due to its permanent fixture status, a modular home must be assembled on top of a foundation that is on land owned by you. This is no surprise, based on the similarities between modular homes and on-site-constructed homes. The land must be zoned and approved for modular home assembly as well.


So, now that you know what modular homes are, you’re aware of modular home design options and cost, and you’ve learned some benefits and disadvantages of modular homes, you should be more prepared to decide if a modular home is right for you. These customized, environmentally friendly, and economical prefabricated homes are a wonderful option, from contemporary to traditional home styles.

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