PREFAB & MOBILE HOMES

Cheap Manufactured Homes: the journey to finding them

Cheap prefab homes
Gary Merritt
Written by Gary Merritt

Years back, many people associated factory manufactured homes with low quality, unattractive box designs and shallow roofing. While cheap manufactured homes still existed, many people shied away from buying them largely based on the assumption that a factory manufactured house could easily fall apart.

Fast-forward to present day and find the modular housing niche growing in leaps and bounds. The negative attitude towards modular homes has largely disappeared mostly because of the realization that these homes can be as strong, or stronger, than those built on-site.

Today, many homebuyers have no problem going for prefab homes. In fact, many people prefer manufactured homes to conventionally built ones because of the many advantages of building them in a factory and transporting the modules for assembly on site.

Small modular home

Understandably, an increasing number of homebuyers are finding no reason to empty their pockets to build their dream home when they can buy low cost modular homes and move in a fraction of the time it would take to get a house built on site.

Moreover, the advancement in technology has drastically brought down the cost of building prefabricated homes. As a result, modular homes no longer have the off-putting price tags that made homebuyers lose their interest in them at the speed of light.

When you set out to find the cheapest modular homes in the market, you must keep in mind that the quote your preferred manufacturer will send you is not the only cost you will need to cover to get your house on location and ready for occupation. To fully account for all other costs, and determine the actual price of a modular home, there are several factors to consider. Here is the full list.

Factors that determine the overall price of a modular home

Clearing of the modular home site

The cost of clearing your lot to create space for the modular home is determined by the type of vegetation that covers it. If you have many big trees, you will definitely pay more than a home buyer whose field is covered by shrubs and weed. All the same, you could choose to only clear the area that the house will occupy and repurpose the rest of the vegetation cover for a garden or something similar.

Excavation of modular home location

Ask any modular home owner and he will tell you that excavation costs can really add up. Before your lot can be ready for the assembly of modules from the factory, a lot of work must be done.

Prefab home location excavation

Therefore, homeowners must be extra careful when choosing a location to prevent the excavation costs from becoming too high for the modular housing project to make financial sense. You should be ready to increase your budget allocation for excavation if the location has boulders and rocks covering most of its surface.

Modular home site grading

In addition to making sure your land looks the way you envisioned, site grading helps to minimize problems with water and other drainage challenges. A proper initial site grading will make sure that subsequent grading costs will be low.

Prefab home foundation

However strong a modular home may have been manufactured, if the foundation on which it will be laid is not strong enough, the house will fall apart. Therefore, when calculating the costs, you must factor in the amount you need to spend to build a strong enough foundation that can support your prefabricated home for many years to come.

Creating a strong foundation may mean further excavation. If now and then the location experiences tremors and earthquakes, you may need to invest in building a stronger foundation than you otherwise would need to.

modular home foundation

Moreover, if you want to set up your manufactured home in a cold weather place, you should use frost walls so that your foundation does not crack. You could also choose to add a walk-out to your basement or make it waterproof. All these decisions will impact the overall price of your prefabricated home.

Water supply costs

Before embarking on the housing project, take time and find out where the locals get their water from. You can save lots of money if it is possible for you to hook up to the water source that is use by those who live in the area. Otherwise, it will cost you a lot more to drill your own well.

Septic tank or sewer system

If your location is not very far from the locality’s main sewer line, installing a sewer drainage system would save you money. However, depending on local regulations you could also choose to install your own septic tank. The costs of installing a septic tank are determined by the type of ground your site is and how much effort would need to be used to excavate the space to install the tank.

Modular home plumbing

Typically, rural areas do not have a sewer drainage system, meaning you would need to use your own septic tank. When making this decision, talk to the authorities at the local government since they should be able to advise you accordingly as to what is allowed and what is not.

Utility Hookups

While you might not want to use gas in your home, the addition a gas line could increase the value of your modular home. Because of the possibility that you may want to sell it in the future, installing a gas line could be a smart move, even if it would stay unused. The cost of an electricity connection should also be factored in. In today’s suburbs, electricity lines are installed underground making their installation a noteworthy expenditure.

A driveway

The cost of creating a driveway will be determined by the intended width and length of the driveway, the material used to make it and other personal preferences. You may also choose to add aesthetic curves or heating coils to the driveway at an increased cost.

Masonry and walkways

Masonry like chimneys and walls can be added to your modular home if you so wish or based on what you are willing to spend on your modular home. You could also add a walkway from your driveway to your prefab home’s front door.

Landscaping

Think about the amount of money it would take to create a beautiful yard around your prefabricated home. The cost of landscaping will typically include buying and planting trees, bushes and shrubs as well as the planting and nurturing of new grass. You may want to simply skip this process and do some of the work yourself so that the costs do not jump to unmanageable levels.

Porches and decks

For homebuyers who prefer homes that exude a certain personality, adding porches and decks might help achieve this. Very few manufacturers include decks and porches in an initial quote. This is because porches and decks are seen as optional additions to a modular home.

’ Manufactured homes porch

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All the same, they help increase the value of the home. Unless the decks and porches are an afterthought, you could talk to the modular home manufacturer to add them to the home design and build them in the factory.

Tips to help you find a cheap modular home manufacturer and builder

Often, when people are thinking about modular homes, they fail to consider the above points as part of the cost. This can lead to the stalling of a project if the homebuyer fails to find a stream of cash to keep injecting into the process until the house is ready for him to move into. That said, when you know what you want and are clear on all the costs, it is still possible to find cheap prefabricated homes.

In a typical prefab home buying process, you will buy a modular home through a builder instead of contacting a manufacturer directly. The following tips will help you find the cheapest modular homes builder with impeccable craftsmanship.

Scan manufacturers’ websites

Find a list of prefabricated homes manufacturers and visit their websites to see their portfolio and home designs. Find the floor plans that align with the type of a house you have envisioned. Additionally, check to see if the manufacturer does custom designs and see photos of some past custom designs that they have created for other homebuyers.

Find a list of certified modular home builders in your area

Once you have decided on the manufacturer that you believe is best suited to deliver a practicable manufactured home solution you need, it is time to review a list of builders in your locality that have the necessary expertise and certifications to work on your kind of house. Usually, if you contact the manufacturer you have chosen, they will refer you to a builder that they work with in the area. The builder will facilitate the rest of the buying process.

Find modular home builder

Therefore, you should think of modular home manufacturers as suppliers. They will supply the builder you have chosen with the relevant modules and other materials needed to assemble your home. The builder becomes the representative of the manufacturer and becomes the go-to person for complaints or call backs.

To find a list of prefab home builders, suppliers and vendors, check the websites of modular home associations. Some of the modular home associations in the United States include:

  • Modular Building Systems Association (MBSA)
  • National Modular Housing Council (NMHC)
  • Modular Home Builders Association (MHBA)
  • National Association of Home Builders (NAHB)

These associations maintain a directory of modular home builders, suppliers and vendors. MBSA, for instance, has a U.S. map that shows you each state and the manufacturers who have relationships with builders in that state or who ship to that state.

Scan modular home builders’ websites

Using the directories maintained by these prefab home associations, find the websites of the builders in your area and see their past projects. Afterwards, create a shortlist of builders to contact. Avoid the temptation of settling on a builder before contacting all the builders you have shortlisted. This will allow you to compare their prices and quality of your interactions before you hire them for the job.

Ask around

Sometimes a builder’s website might not be enough source of information to make a decision on which builder to hire. That is why you should not shy away from asking the people around you for their recommendations. In particular, park managers make for a good source of information regarding local general contractors because they interview them for projects all the time.

Manufactured homes builders

Your neighbors can also help you understand the builders who work in the area and the quality of work you can expect by giving you their feedback regarding the builders of the projects they have undertaken in the past. Most people would be willing to disclose to you how much a builder charged them and how to get the cheapest prefab home deal in the locality.

Check community announcement boards

It is not uncommon to find posters of modular home builders on announcement boards. These would typically include individuals and business who assemble modular homes in the area. This is a particularly rich place to find cheap modular home builders.

Interview the builders/contractors

An interview with a builder can be via phone or in person. If possible, get the contractor to commit to coming to your location and making an assessment.

Ask the builders

However, keep in mind that some contractors will charge you to come on location while many will find it hard to come to your location without an assurance that they will be hired for the job. Whether in-person or over the phone, do your best to negotiate the terms as you explain to the builder about your expectations and your budget.

Tips to help you find the cheapest modular homes that are ready for occupation

Given the lengthy process of buying a new modular home, moving it to your location and assembling it for occupation, some people choose to buy a modular home they can move into immediately. Finding such a home also eliminates the process of excavating the land, land grading, drainage and sewer system installation, landscaping etc.

But how do you find the best deals for modular homes that are ready for you to move into? Here are a few tips:

Check real estate directories

Visit a number of online real estate directories and look for the best deals for manufactured homes in your area. Some of the most popular online real estate directories include Realtor.com, Zillow.com and Trulia.com. When doing your search, use a price filter and sort the list starting with the cheapest.

Check real estate directory

Additionally, try and identify a price pattern in your area. This information can help you know the place you should go for the cheapest prefab home deals in the region. If location is not very important to your decision, you could entertain the thought of buying a modular home further away from your preferred location.

Look at many homes before making a decision

Don’t be in a hurry to buy a house. Instead, take your time to understand the modular housing market and the factors that determine the price of a modular home. This knowledge will make it instinctively easy to identify a great deal when you come across one. The last thing you want is a slapdash decision that will prove to be painfully expensive over time.

You could set aside a weekend to drive up and down the streets to check out the prefab homes in the area. Additionally, you could look for a smartphone app that can help you find some low cost modular homes. Simply put, the more prefab homes you can review, the higher your chances of finding a list of the cheapest prefab homes in your area.

Make many offers

A real estate investor will tell you that the best way of finding a cheap house is through making as many offers as you can. Many in the real estate business use the 100-10-1 rule. This rule states that you ought to review 100 houses and choose 10 that you can bid on and get 1 bid accepted.

Make offers to builders

Given that you are looking for the cheapest deal, chances are that most of your bids will fall through. This should however not discourage you. Keep reviewing more prefab homes and making more offers until you find the best possible deal.

Look for an FSBO sign

Instead of using a real estate agent to sell their home, some sellers seek buyers directly. You will know them by the “For Sale By Owners” (FSBO) sign that they usually include in their ad.

A number of these buyers have no idea what their home is worth and could offer it at a fraction of its real value. While this approach may require you to be patient as you peruse Craigslist and other such sites for FSBO deals, it could end up paying off in the end if you find a good deal.

Find out how long the home has been listed

By looking at a Multiple Listing Service (MSL) report, you can find out how long the prefabricated home has been listed in a real estate directory. The longer it has been in the directory, the higher the chances of the homeowner accepting a lower price.

Find out the listing date

MSL reports include “PMP” (property marketing period) or “CDOM” (continuous days on market). These two should give you an idea of how long the modular home has been in the directory. All the same, keep in mind that the home could have been relisted after the expiration of the initial MSL contract.

Look for Real Estate Owned (REO) homes

Real estate owned homes are almost always cheaper than other modular homes in the same listing. This is because REOs are as a result of foreclosure. When a modular home is foreclosed, it is usually resold at a fraction of its real value.

That said, you should be ready to do a number of fixes before you can move into the home because some foreclosed homes may have been neglected for a number of years.

Negotiate relentlessly

One big mistake many home buyers make is assuming that the seller’s asking price is cast in stone. The truth is, this is rarely ever the case. Enter the negotiations ready to lose the argument and lose the deal.

That way, you will have prepared your mind to negotiate with nothing to lose, and thereby increasing your chances of landing a cheap manufactured home deal.

Don’t be afraid of fixer-uppers

Do your math! If a modular home is going for $50,000 less because it is in a relatively bad state, consider how much it would cost you to carry out the renovations. You may be surprised to find that you could do all the necessary repairs and not spend more than $10,000.

Welcome fixer uppers

Consequently, you will have bought the prefab home at $40,000 less than its market value. For those who are unafraid of dealing with contractors or doing the repairs themselves, this approach can help them buy the cheapest prefab homes in the market.

Consider a real estate wholesaler

Real estate wholesalers find great deals and offer a buyer the right to sell the deal for a small price. These real estate wholesalers often find cheap deals on modular homes through their excellent negotiation skills and marketing expertise.

While this approach can save you a lot of money, it only works if you are buying cash. Real estate wholesalers do not accept loans or hire purchase terms.

Cheap manufactured homes do exist, you just need to know where to find them

While you should do everything possible to find low cost modular homes, you should never compromise on quality. It would be preferable to spend a little more money to get a quality prefabricated home than to insist on spending so little only to end up with a manufactured home that will fall apart a few years down the line.

To make sure that you end up with a prefab house that is worth the money you spent on it, take time to learn about the different prefabricated home manufacturers that operate in your state and the builders they work with.

Find cheap manufactured home now

Understand exactly what to look for and how to identify a quality prefabricated home from the rest. You can only perfect this skill by scrutinizing the modular homes listings in online directories. The journey to finding cheap manufactured homes can be daunting and frustrating, yet, you can reap big if you have the patience and the resilience to keep going until you get hold of your dream home.

Let us know if you have any tips for finding low cost modular homes that we missed? Also, if you have any successful negotiating tips we would all be curious to hear what they are.

Comment in the section below so we can all get out there and start hunting for bargains.

ABOUT THE AUTHOR
Gary Merritt
Gary Merritt

Gary did an engineering degree in Vancouver, BC while working in different construction companies both on-site and in the office. He is passionate about manufacturing process and dreams that one day construction of the house will be as simple as ordering a hamburger in McDonalds. His motto is: “It is possible”. Gary is an optimist and works on making changes in housing situation on global scale.

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