Choosing a type of home to buy is a big decision. Pre-fabricated homes are attractive options when you’re looking to save money without sacrificing quality, but how do you make sense of all the different terms out there?
You may see options described as “modular” or “manufactured,” but it’s not always easy to tell the difference. You might struggle to compare modular vs. manufactured homes — or wonder if they’re the same thing as the mobile homes you’ve heard about since childhood.
This article will clear all of that up. Here, you’ll learn the difference between modular vs mobile vs manufactured homes, and why you don’t see people building mobile homes anymore. You’ll also learn about financing options for manufactured vs. modular homes and what you need to know about buying and selling each one.
A modular home is a home that’s built by sections in a special facility. Flat-bed trucks transport each section to the homeowner’s property, where heavy cranes lift the pieces and fit them together.
The final product looks, feels and is built to the same building code as a traditional site-built home — the kind that’s constructed from basement to attic on the site where it will stand. People tend to be less familiar with the modular building process, but it offers several advantages to the buyer.
Construction on a modular home happens almost entirely in a self-contained facility where quality control teams can monitor every step of the process. It’s a very different process than you’d usually get with a site-built home, where you’re at the mercy of the crew and the weather.
Because construction takes place in a controlled environment, modular homes tend to go up faster than site-built homes. You don’t have common site-built home delays like:
Modular home facilities are climate-controlled, allowing the building process to continue uninterrupted — unless extreme weather or other emergencies keep the crews from reporting to the facility.
With modular homes, construction is centralized and everyone knows the process. Work doesn’t slow down just because a crew member doesn’t know what comes next. If there is a question, there’s always someone on-site who can give direction.
While modular homes aren’t as customizable as site-built homes, you’ll still have plenty of options to choose from. Most manufacturers have a range of floor plans and allow buyers to select the one that works for them.
Buyers usually have interior design choices to make, such as options for:
Floor plans and interior options vary by manufacturer. It’s always a good idea to ask what you can customize, since that may not be obvious at first.
Modular homes give you all of the advantages above and still cost up to 30% less than a site-built home. You’ll still have to pay for the land and get the utilities hooked up, but you’d be responsible for that with a site-built or manufactured home anyway.
Like a modular home, a manufactured home gets built in a specialized facility and transported to the buyer’s chosen location.
Manufactured homes can be single, double, or triple wide. Don’t put too much stock in those descriptors, though. Double-wide homes aren’t necessarily twice as big as their single-wide counterparts, nor are triple-wide options three times as big.
Terms like single-wide have more to do with whether the home gets transported in its entirety or several pieces. Single-wide manufactured homes can travel from the facility to the lot in one piece. Double-wide and triple-wide homes have to travel in two or three pieces, respectively.
Double-wide homes tend to look more like site-built homes because they’re shorter as well as wider. The same is true for triple-wide homes.
The building of a manufactured home can take days or weeks, depending on the manufacturer. In the meantime, the buyer or manufacturer needs to have the building site prepared and inspected. That includes:
Foundations for manufactured homes can be permanent or non-permanent. Non-permanent foundations, like concrete slabs and steel frames, are less costly but also less secure. They’re usually only suitable for flat lots. Permanent foundations, like basement and Crawlspace foundations, are more expensive but can give you more storage space to work with. You may even be able to use a basement foundation as living space.
When the new home arrives on-site, the setup crew will secure it to the foundation. If the home is double-wide or triple-wide, this step will include attaching the two or three sections. The setup crew will also connect the utilities and complete the finishing touches inside the home, including any necessary paint touch-ups and flooring connections between the components.
Many people, especially outside the industry, use the terms “mobile home” and “manufactured home” interchangeably. Fundamentally, they’re the same type of house. Both are:
Believe it or not, the only real difference is that mobile homes are older. The Housing Act of 1980 states that this type of structure can only be called a “mobile home” if it was built before June 15, 1976.
Before then, mobile homes were mass-produced and met the widespread need for affordable housing, but there were few standards in place to make sure they were safe and of high quality. That all changed when the HUD implemented the Manufactured Home Construction and Safety Standards in the mid-1970s. These standards cover all aspects of home construction, including:
Some manufactured homes have attached red tags confirming that they comply with this code. All manufacturers and sellers are subject to HUD inspection to make sure they conform.
Because manufactured homes are built to code, they tend to be higher-quality and safer than pre-1976 mobile homes. In many if not most cases, they’re visually indistinguishable from traditional site-built homes.
There have been huge advances in building quality for both modular and manufactured homes over the past few decades. The mobile homes of the ‘60s and early ‘70s bear little resemblance to their sleek, modern counterparts. Some people still call a manufactured home a “mobile” home, but that’s where the resemblance stops.
Today’s modular and manufactured homes are beautiful and comfortable. They’re also faster and usually less expensive to build than site-built homes. There’s more potential for quality control.
There are some key differences, though. Knowing what those are can help you to decide which type of home suits your needs. Since any newly built home you buy will be a manufactured home, as opposed to a mobile home, we’ll look at modular vs. manufactured homes and leave mobile homes out of the picture for now.
The most obvious difference between modular and manufactured homes is how they travel. While manufactured homes travel in their entirety — or halves or thirds — modular homes arrive in sections and get pieced together.
The setup process is more intensive for a modular home. That’s why once they’re in place, they usually have to stay there. Manufactured homes, especially single-wide versions, are easier to move from one place to another — though you still have to go through the process of setting them up on the other end.
In almost all cases, modular homes are more customizable than manufactured homes. Builders usually give you more possible options in terms of floor plans with a modular home. Layouts are more variable, too.
Manufactured homes are famously difficult to expand or improve. With a modular home, on the other hand, you can typically add on in the future if you need more space.
Modular homes are often safer and last longer because of how authorities regulate these homes:
Modular homes undergo inspection and third-party certification to ensure that they’re built to code. Site-built homes have to comply with the same codes as modular homes. That means a modular home should be just as safe and sturdy as any site-built structure — if not more so.
When deciding between a modular home vs. manufactured home, you also want to consider how easy or difficult it will be to get financing. There’s a significant difference, and it tends to favor the modular home.
In almost all cases, when you buy a manufactured home, you get financing from the seller or manufacturer. Many sellers have relationships with finance companies. If that’s the case, the finance company will dictate the terms of your financing.
These terms aren’t always to your advantage. They may have a higher rate than you’d get with another type of home financing, and balloon payments may even be involved. A balloon payment happens when you pay off small amounts of the loan monthly, then end up with a larger sum due when the loan expires.
Buyers of modular homes tend to have significantly more financing options than buyers of manufactured homes.
One option is to get financing from the modular home dealer or construction company. This is most common when the dealer is also the general contractor working on the home, and it’s almost a sure thing if that dealer-contractor owns the land.
Another option is to get a construction loan from a lending institution like a bank, mortgage company, or credit union. You may also be able to get a construction loan from your modular home dealer or general contractor.
A construction loan is a short-term loan that finances the building of your home After the work is finished, the lender pays out the cost of construction. When the work is done, the loan transitions into a traditional mortgage that you pay off like any other home loan.
It’s possible to sell manufactured and modular homes, but manufactured homes are notorious for losing value over time. This has a lot to do with the fact that manufactured homes aren’t improvable, so homeowners can’t make up for depreciation.
Modular homes retain their value and may even become more valuable, just like a traditional site-built home. You can even build onto your modular home easily and with less disruption than a traditional home addition.
As mentioned earlier, you can’t get a new mobile home — legally, a mobile home is one that was built before the mid-1970s. When you compare different types of new construction, modular and manufactured homes offer several clear advantages over site-built homes. They’re less expensive without sacrificing quality, safety, or sturdiness. The construction process is faster and more convenient, too.
Modular homes offer you more flexibility in terms of design, and they’re significantly easier to finance. Plus, they’re significantly easier to re-sell in the future. They don’t depreciate as manufactured homes do, and it’s much easier to find a lender who will issue a mortgage on the second sale of a modular home.
If you’re interested in learning more about modular homes, Century Home Builders is here to help. Check out our selection of beautiful floor plans, view our listings of available homes, or contact us to speak with a representative. We’re passionate about quality modular homes, and we’re excited to share that passion with you.