Recently we built a custom modular T-Cape for one of our customers. The plan is the Wiltshire, which is also available as a one-story with a lower pitched roof.
Here is the modular Wiltshire T-Cape elevation:
Here is the modular Wiltshire T-Cape floor plan:
The standard modular Wiltshire T-Cape has 1,900 square feet, three bedrooms, and two baths on the first floor.
Click here to see several photos of our custom modular Wiltshire T-Cape.
As the photos show, the three front facing gables along with the center A-dormer add character and charm to the exterior of the home. The entry porch is practical yet ornamental. The floor plan is set up for easy entertaining. The kitchen, which opens to a large dining room and gorgeous living room, features a gourmet chef’s granite center island along with plentiful cabinets. The distinctive hardwood floors and Italian tile add beauty throughout the home. The master bedroom suite is well-equipped with dual lavatories, an oversized shower, and a generous walk in closet. The other two bedrooms are comfortably sized, while the laundry room provides ample and attractive cabinetry. The unfinished second floor offers abundant additional room for future expansion, such as for another bedroom or two, a home office, playroom, or storage.
There are many things to learn the first time you build a modular home. But if you’re like most homebuyers, you won’t get the full benefit of what you learn, since you’ll likely only build one home.
But you can benefit from what I’ve learned over twenty-eight years building more than 1,200 homes. To start with you can read my book, The Modular Home, which gathers all this information in one place.
Take Advantage of My Experience by Using My Modular Home Checklists
Of course, it’s hard to use a book efficiently the first time you use the information. That’s why I’ve created several checklists that cover the most important steps. Below is a link to each of the checklists. There’s also a link to this list on the home page of The Home Store’s website. I hope you find these modular home checklists helpful.
Why Building a New Home Is Better Than Remodeling When You Need Accessibility
What should you do if you need an accessible home? Should you remodel your current home, buy a more accessible used home, or build a fully accessible new one?
Since there are very few truly accessible used homes, let’s compare remodeling your existing home with building a new one. Since I believe building new is almost always better than remodeling, I will outline the advantages of building over remodeling. Of course, if you don’t have the resources and flexibility to build a new home, remodeling will be your only viable alternative.
No Demolition and Shoring Up Expenses
You will not waste money demolishing or shoring up your new home.
Remodeling your existing home to make it accessible can often be surprisingly expensive. You will undoubtedly anticipate some of the costs for adding new features, but you may not plan sufficiently for the cost of the other work required to remodel. Most importantly, you must add the cost of the destruction (taking apart and removing what you no longer want) to the cost of construction (building in the new features). In addition, you must add the cost of shoring up the existing structure of your home so that the new construction can be completed. For example, in addition to tearing down old walls and ripping out old plumbing and electrical, you might need to add structural supports in the ceiling and basement before you can begin. Otherwise, your home will not be structurally sound.
The task of removing walls and shoring up the structure is usually a Pandora’s Box for the remodeler. Often the remodeler can’t know what problems and expenses he is going to run into until he actually starts the demolition. If you ask him to give you a fixed price for the entire project in advance, he will usually build a significant cushion into his price. If you agree to pay him for “time and materials”, and he uncovers a number of problems that require additional work, he will hit you with a change order that will create cost-overruns for you. That’s why remodeling often goes significantly over budget.
Greater Equity and Resale Value
Your new home is likely to provide you with greater market value and equity than a remodeled home.
Since the demolition and shoring up your home will not increase its value as much as it costs (only the new construction will), the total cost of the remodeling will often be considerably greater than the value added to your home. Since much of the money you will spend on remodeling will be lost, your bank’s appraiser will be unlikely to justify a loan for the full cost of remodeling unless you already have a lot of equity in your home or a large down payment. And should you decide to sell your home, you will likely lose some of the money you spent remodeling it.
Since every room in your new home can be designed to be accessible and located where you want it, you will need to make fewer compromises to get the features and functions you want.
Because the remodeler will have to work with your existing structure, he might not be able change the home sufficiently to give you enough of what you need. For example, the remodeler might not be able to locate the accessible bathroom where it would most benefit you.
Efficient Use of Space
Your new home will provide you with the rooms you need without wasting space.
When remodeling your home, you will often have to give up some existing rooms so that the needed features and functional space can be added. For example, one of your existing bedrooms might have to be donated to the remodeling cause so that your hallways, doors, and bathrooms can be widened. When the work is done, you may feel that you have lost valuable space.
Attractive and Functional Landscaping
The site of your new home will be graded and landscaped in ways that are esthetically pleasing as well as usable.
When remodeling your home, you will sometimes have to settle for site work and landscaping that is less attractive. With your foundation, driveway, and walkways already in place, the remodeler is limited in how he can make your site more accessible without detracting from its appearance (often with long ramps) and adding considerably to the cost.
Lower Architect Fees, Custom Design
Whether you wish to customize a builder’s standard plan or design a completely new custom plan, a modular home builder’s fees will be substantially less than those required for a sizable remodeling project.
When remodeling your home for accessibility, you will often are best served by hiring an experienced architect to design a remodeling plan.
Home and Lot Matched in Size
You will be able to match a building lot of appropriate size with a new home that is as big as you need and your budget allows.
When remodeling, your design choices will be limited by the size of your home and your lot. If your home is too small, and your lot does not allow for easy expansion, which can happen in city lots, your design options will be limited.
Right Sized Home
When building a new home of your choice, you will end up with a home that is neither too big nor too small.
If your existing home is already bigger than you need, your remodeled home will almost certainly be too big. If your existing home is not too big before remodeling, but the remodeler is forced to add rooms in order to meet your needs, your remodeled home may become too big. For example, if you have all of the bedrooms that you need, but they are all on the second floor and you need a first floor master bedroom suite, you will be forced to build an extra bedroom.
Lower Energy Costs
Your new home will be considerably more energy efficient than your remodeled home.
Your remodeled home will usually have higher energy costs. Older homes were not built as energy efficient as new homes are today. Often the budget for remodeling won’t allow for improving the energy efficiency, since to insulate all of the walls and replace all of the windows can be expensive. In addition, older homes have very high amounts of air infiltration (leaks around the windows, doors, and electrical receptacles), and air infiltration is the number one cause of heat loss, even after insulation has been added and windows replaced.
Brand New Fixtures, Fully Featured
With your new home, everything will be brand new with the features you desire.
With older homes, your remodeling budget will require you to keep certain things you would prefer to replace. For example, although you might like to replace your fifteen year old appliances, the cost of the remodeling will probably prevent you from replacing them. In addition, your budget will often prevent you from affordably adding features that you would desire. For example, if you want to add central air conditioning, but you have hot water baseboard heat, you will need to add the duct work in addition to the air conditioning compressor, which will add substantially to the total cost.
Lower Maintenance Costs, Extended Warranty
Because your new home will come with new materials, it will require minimal maintenance. Furthermore, all the parts will be protected by a warranty. In fact, your entire modular home will come with a ten year structural warranty.
Even after your older home is remodeled, it will have higher maintenance costs. All areas and components of your home that are not completely replaced will continue to bear the effects of wear and tear. In addition, the only items that will have a warranty will be the ones installed by the remodeler.
Two weeks ago I wrote about how modular homes stand up to severe weather, such as a tornado or hurricane. In the past I described how one of our modules suffered only minimal damage when it fell off a trailer while we were setting the home. I’d like to mention another example of the superior strength of modular homes.
In 1990 we brought a two-story modular home – the Whately 1 – from New York to Massachusetts where we erected it at the annual Springfield home show sponsored by the local chapter of the National Association of Home Builders. Over 90,000 people visited the model. After the show, we disassembled the modules and delivered them to our model home center where they were re-assembled. Three years later we disassembled the modules yet again and moved them to a customer’s property where we reassembled them.
All together the four modules were each moved three times, assembled three times, and disassembled twice. Each time they were assembled or disassembled they were lifted by a crane, which means they were picked up with a couple of thin straps five times.
If you’ve never seen a modular set, it is amazing how well the modules fare when they are lifted by the crane from the delivery carrier to the foundation. This is especially true when you consider that each module weighs several tons, which makes the stress on the framing quite substantial. Yet there was only minimal damage when the four modules of our old model home were craned into place for the last time. If a conventionally built home were lifted with a couple of thin straps even once, it would suffer substantial damage.
I will add one more observation. As strong as modular homes were in 1990, todays modular homes are even stronger. Food for thought!
The Right Modular Home Floor Plan Sometimes Doesn’t Come with the Right Modular Home Elevation
A couple of months ago I discussed the importance of a modular home elevation drawing. Seehere and here. One thing I emphasized is that home plans on the internet almost always show a dressed up home. But this doesn’t mean they’re adorned in the way you’d prefer. It also doesn’t mean that the ones with the right floor plan layout have the look you want. For example, they may have fancy siding, a taller roof, and a reverse gable. But the one thing they don’t have is your front porch.
The good news is that you can add a front porch to virtually any modular home plan just as you can add a garage to any plan. In addition, you can dress up your home with circle top windows, an ornate front door, decorative moldings, a hip roof, reverse gables, gable returns, A-Dormers, scalloped siding, cultured stone siding, a chimney, and a lot more. Most modular home elevations will display some of these features. But none of them may have the right combination of features matched to the right floor plan layout. So you and your dealer will need to add the modular home elevation features you favor to the floor plan you select.
Examples of How to Dress Up a Modular Home Elevation
Here are six examples of how you can start with a relatively simple modular home elevation and embellish it:
The modular home elevation of the Crookston one-story plan on the right adds a garage and front porch.
The modular home elevation of the Barclay cape cod plan on the right adds a larger front porch that also serves as a dormer, a stone facade, and a combination of vertical and horizontal siding..
The modular home elevation of the Bellmeade two-story plan on the right adds a hip roof, three A-dormers, a brick chimney, a more formal front porch, and brick siding.
The modular home elevation of the Glamorganone-story plan on the right adds a taller roof and a larger garage with a reverse gable and entry doors on the side.
The modular home elevation of the Tiffany cape cod plan on the right adds a front porch, a partial brick facade, and decorative moldings.
The modular home elevation of the Gordonone-story plan on the right adds a front porch, a taller roof with an A-dormer, a partial stone facade, vertical siding with a scalloped accent, and a circle top window.
Have Your Modular Home Dealer Customize the Modular Home Elevation to Your Liking
As I mentioned in my other two posts (see above), take a second look at some desirable floor plans that you might otherwise reject – because they’re matched with unacceptable elevations. A practical way to do this when you are looking at modular home plans is to cover up the exterior elevation plans with a piece of paper. Otherwise you will find your eyes continually drawn to the elevation plans as you turn the pages. Once you select some floor plan layouts that you like, have your dealer show you how he can create some modular home elevations that please you.
Since we’re entering “hurricane season”, I thought you might want to see a couple of videos about how two of our homes fared against a violent tornado with 160 MPH winds: Part 1 shows how the modular homes were much more durable than the stick framed homes when struck head-on by the tornado. Part 2 includes interviews with the homeowners.
Here explains why modular homes are stronger than conventional, stick built homes. Keep in mind that this was written by the National Association of Home Builders, whose members are almost entirely stick builders.
Are you considering replacing your existing home with a new modular home? You have lots of company. Many of us are happy with our neighborhood, local schools, and commute to work. We’re also attached to our property, often because we like its size and views. If only our homes were big enough for our families. If only they had layouts that worked for how we live. If only they had modern features and better energy efficiency. If only we could fix our problems with some reasonable and affordable remodeling.
But what if remodeling is not viable? What if you’d prefer a new home? If so, you’ll likely consider purchasing a building lot – if not in your neighborhood, at least in your town. But what if your town is well established with a home already built on virtually every lot? You might then consider “tearing down” your home and replacing it with a brand new modular home.
Can You Tear Down Your Home
Before you contact a modular builder, you should learn what your town’s zoning, planning, and building departments allow. Their regulations are partly in place to protect the existing character of your town and neighborhood. They dictate whether and how you can tear down your existing home. They also determine what you can build as a replacement. This usually includes the size, footprint, square footage, height, and style of your home.
If your home is in a historic preservation district, you may be prohibited from tearing down your home, or at least required to adhere to the architectural standards of your neighborhood. In fact, your abutting neighbors will likely have some input into what you can build. It’s often best to speak directly to them in advance of pushing ahead. If your property is part of a subdivision that is governed by a homeowners association, make sure it’s bylaws do not prevent your home from being torn down.
You should also check with your gas, electric, and water utilities to learn how you can disconnect these from your home. You should consult with your fire department to see what they need. You should expect your town to require an inspection for toxic materials, such as asbestos or an old diesel tank. And you should speak with your board of health, if you have a septic system, to see what’s needed to comply with its regulations.
If you skip these steps, and assume you can tear down your home, you may waste a lot of time designing a home you cannot build.
The Cost to Tear Down Your Home
Be prepared to pay between $5,000 and $25,000 to demolish your existing home, haul the materials away, and cover the disposal fees. You’ll pay even more if your home has asbestos or other toxic materials. You’ll also likely need to pay for a demolition permit.
How to Finance the Tear Down and Replacement of Your Home
If you are financing your project, you must qualify for a construction loan and mortgage in terms of income, debt, and credit. (Check out my blogs that explain what you need to know about financing a modular home.) In addition, there are a couple of financial considerations that are unique to demolishing and replacing your existing home. Take these seriously, since they’ve tripped up many customers in the past.
Unless you own your home outright, you cannot tear it down without first paying off the existing mortgage or obtaining written permission from your current lender. However, your lender will not grant permission if the loan balance is more than the value of the land, since the land will be the only equity left after the demolition. Should you tear down your home without paying off your loan or obtaining permission, your lender will invoke the default clause in your mortgage, which will create some serious legal headaches for you.
If you have an existing mortgage, you will need a loan that covers the balance owed on your existing home, the demolition, and the construction of your new home. A consideration for your lender is whether you will have sufficient equity in your property after the demolition and repayment of your current loan balance. The equity is needed to serve as a down payment on your new loan. If the outstanding balance is substantial, however, you may not have enough equity, unless you have another source of funds
A second consideration for your lender is whether the value of your finished home will be sufficient to support the total of your new mortgage. The lender needs to be confident that if you default on your loan, they can recover the balance by selling your property. They will determine the value of your new home by obtaining a professional real estate appraisal.
If you are building a second story modular addition, you are most likely doing it to create more living space rather than a separate living unit. The general contractor will turn your one-story into a two-story by removing the roof from your home and immediately setting the new modular second story with its own built-in roof on top.
The speed of modular construction is a tremendous benefit when building a second story addition, since the addition can be set in place within hours after the roof is removed from your existing home. Once the modular addition is in place, the inside of your home is protected from a sudden storm. A site builder cannot realistically protect your home as quickly. Another advantage is that the second story can be finished faster. This means your family can use the upstairs more quickly, even if it must wait to enjoy the downstairs until the remodeling is completed.
Requirements for Second Story Modular Additions
There are two conditions that must be met before you can build a second story modular addition. First, the exterior dimensions of the existing home must be compatible with one of the modular manufacturer’s production sizes. If your home is too wide, a modular will not easily work. If your home has multiple bump-outs, a modular might work, but it may be impractical and expensive. A home can be up to 3-feet narrower than a module, however, and adding a wider second floor can create an attractive, cantilevered garrison colonial look.
The second condition is having an existing home and foundation that are structurally capable of carrying the additional weight, which is substantial. You will need to hire a structural engineer to make this determination. He may give you specific instructions on fortifying the structure or the foundation, which might be unacceptable or too expensive. If you decide to carry out his instructions, the GC will complete them as part of his remodeling. Before the engineer completes his final written report, he will need to see plans of exactly what you are building and receive detailed information from the manufacturer.
Design Issues for Second Story Modular Additions
When designing an addition, you must decide where the stairs to the second floor will be located. You must also determine a location for a chase from the basement to the second floor to carry the electrical wires, HVAC supply and return ducts or pipes, and plumbing pipes for second-floor bathrooms. If the GC is connecting to a forced-air system in the basement, the chase must be larger, since the ducts will take up more space than hot-water lines.
The design of the second story elevation must be coordinated with the first-story elevation. The window locations on the second story should be arranged in a pleasing fashion. This decision should be made early in the design process, since the location of the interior partition walls on the second story must be coordinated with the window locations (you cannot put a wall in the middle of a window). In addition, the window style and sizes should be matched as closely as possible to the existing home.
The exterior elevation of all four sides of the finished home must take into consideration any first-story bump-outs or structures. For example, the location of an existing bay window, porch, sunroom, portico, recessed entry, or garage can pose special design challenges. The second story must be planned so that it does not affect either the function or aesthetic appeal of these structures. In some cases, it might be necessary to remove a part of the bump-out or attached structure, such as a garage roof, before installing the second story. If the modular second story will be cantilevered, the overhang can pose additional problems with a first-floor bump-out, such as a bay window.
The exterior siding on the second story must fit with the siding on the first story. Otherwise, the siding on the first story will have to be replaced. If you currently have wood siding, you might need to repaint or restain it to create a color match. Similar coordination issues arise for shutters and other exterior trim details.
If you have a chimney on your existing one-story home, you will need to make it taller to reach above the roof of the second floor. In addition, all trees overhanging the first story will need to be removed.
Material Disposal and Second Story Modular Additions
The actual removal of the existing roof as well as any other materials you are replacing in your existing home, such as the siding or windows, will be a task unto itself. The cost of disposing of these materials will be appreciable.
Most importantly, when you are done building your second story modular addition, it will almost feel like you have just built a brand new home.
Attached modular additions are sometimes built to create a separate, additional living unit and sometimes to create more living space. Most zoning boards consider any addition with a separate kitchen to constitute a separate living unit, which requires that the wall between the two units must serve as a “fire stop.” The easiest way to accomplish this is to have the modular manufacturer build a fire-rated wall on that side of the addition.
Zoning and Attached Modular Additions
To qualify as an addition, your community’s zoning regulations will require that it be connected to your home. Detached additions are almost always disallowed. You can connect the two by attaching the addition directly to your home or by joining the addition and your home to another room in between, such as a small site-built mudroom or large, modular great room.
Locating Attached Modular Additions
Your property’s topography may limit where you can build an attached addition. If one side of your lot is wetlands or contains a septic system or municipal sewer pipe, you might not be able to build on that side. You will have the same problem, although to a lesser extent, if one side of your land has a steep slope or an outcropping of rock. Although you will want to locate the addition so that the floor plans of your home and addition work well together, you may want to consider an alternative if the preferred location would incur substantial additional expenses.
Roof Design of Attached Modular Additions
In designing a modular addition, the dealer and GC should make sure that the intersecting roofs shed water and snow properly. This is particularly important when the addition is being built in areas with the potential for heavy winter snow, because the roof of the addition needs to be attached to the existing home so that the two can carry the load together. Depending on how and where the modular addition will be attached, the manufacturer may ask you to hire a structural engineer to determine what needs to be done to make the two structures work together. The engineer may require the GC to beef up the existing roof to carry the additional load.
Matching Openings Between an Existing Home and Attached Modular Additions
Before your modular addition is built, the GC must measure exactly where the openings into your existing home are located. The modular dealer will then use that information to line up the connecting openings in your addition.
Scope of Work for Attached Modular Additions
If you are attaching a modular addition directly to the existing home, the GC will need to remove the siding on the existing home’s wall. Any windows or doors on that wall will also need to be removed, and the resulting holes will need to be closed off and finished so they match the home. No matter how well the addition is set alongside the existing home, there are bound to be small gaps between the two. The GC will need to tie the two buildings together on the inside and outside to hide any gaps. Next week I’ll discuss the second-story modular additions.
Modular construction is a great way to build an addition. You get the quality and price advantage that modular homes are known for along with faster build time. Speed is particularly beneficial when building an addition, since the construction will temporarily disrupt your family’s life, especially if you remain in your home while the work is being done.
Modular Additions: Attached and Second Story
Modular additions come in two types. The most popular type is attached to the side of a home to create either a separate living unit, such as an in-law apartment, or additional rooms, such as a new kitchen, dining room, and great room. Some customers build an in-law apartment at the same time that they build a new modular home. The second type of modular addition is set on top of a one-story home to make it into a two-story.
Modular Additions: Ensuring You Can Build
Before you spend too much time considering an addition, find out whether or not you can build one, and what will be required if you can. There are any number of issues that can prevent you from going forward. Not surprisingly, several of the issues that affect your ability to build an addition are the same as those that can restrict what you can do with a particular building lot.
Modular Additions: Covenants, Deed Restrictions, and Easements
When building an addition, you will be compelled to abide by any covenants and deed restrictions that apply to your property. Almost all subdivisions have covenants limiting what you can build, and a previous owner of the property might have placed a restriction on what you can do. Although covenants and deed restrictions do not usually address additions, the only way to know for sure is to check. You will also be prevented from building an addition on any part of your property where someone has an easement or right of way, unless you negotiate new terms that are recorded on your deed.
Modular Additions: Zoning Regulations
Local zoning requirements may affect several things you might want to do with your home. Setback regulations will prevent you from building an addition too close to abutting properties or the street, which could force you to build the addition on the side of your home that is less practical and affordable. If your property does not have a current survey, or if the boundary stakes are not in place, you may need to hire a surveyor before you can convince the building department that your addition complies with the setback requirements. It is unlikely the setback requirements will have much bearing on your plans if you are building a second-story addition.
Most communities have specific zoning regulations governing if and when you can add a second living unit to your home, such as an in-law apartment. Some require a special permit or a zoning variance for any two-family unit, regardless of use or size, while others provide an exception for an in-law apartment. Still other communities allow you to build only two attached single-family units on larger lots than are required for a single-family home. Zoning regulations can dictate how large a home you can build. Some communities restrict how tall the roof can be.
Modular Additions: Building Codes
Some building codes require anyone constructing an addition to upgrade their existing home to current building-code standards. For example, the building inspector might stipulate that you outfit your existing home with approved smoke detectors that connect to those installed in the addition.
Modular Additions: Module Access
In order to build a modular addition, the transporters, crane, and set crew must be able to set up in the proper location on your property. Even if your original home is modular, and access was not a problem when you built it, it is possible that you could run into a problem with the addition.
Modular Additions: Financing and Appraisal
Before entering into a contract to build an addition, determine how you will pay for it. If you intend to use a lender to finance the construction, you may have a choice of either an equity or a construction loan. To use an equity loan, you must have sufficient equity in your home, since the lender will only allow you to borrow against that equity. An appraiser hired by your lender will determine the amount of equity in your home. If you owe money on your home but the mortgage is small, the appraisal is less likely to matter, since the lender will have sufficient collateral even with a low appraisal.
If you have little equity in your home, and need a construction loan, the lender may require a down payment. It will also want an appraisal of your home that includes the proposed addition. Before you spend too much time exploring construction costs, speak with a couple of lenders to see what they can do for you.
When Modular Additions Are Not the Best Choice
There are times when it does not make good financial sense to build a modular addition. In general, it only makes economic sense to build a modular structure if the modules are reasonably sized and have some value-added features. A one-room addition, such as a great room measuring 20 feet by 27 feet 6 inches, does not meet these criteria. A small multi-room apartment, however, with a kitchen, bathroom, bedroom, and living room, such as a 22-foot by 24-foot in-law addition, does; for example see our Harmony 1, 2, and 3 in-law addition plans. As these examples show, size is not the only relevant factor. The great room is bigger than the in-law apartment, but it is full of empty space. This kind of structure is better built by a conventional stick builder.
Next week I’ll discuss the general contracting work required for modular additions.
Over the last few years, obtaining financing has been one of the most difficult problems for builders and customers. Not only have many banks been unwilling to lend, their appraisals for new construction have fallen so much that willing and qualified buyers have been unable to get sufficient financing.
The market is now greatly improved and continuing to get stronger. More and more banks are willing to lend. But appraisals for new construction can still be a problem. The reason is that the sale price for a “comparable” existing home is often considerably less than the cost of building a new one.
Three Reasons Why There Are Still Appraisal Problems
There are three reasons why new homes cost more than existing homes. Land prices have remained steady in most places because land is a scarce commodity. As Mark Twain pointed out, they don’t make it any more. The percentage drop in the cost of construction labor, where it’s happened, isn’t anywhere near as great as the percentage drop in the price of existing homes. Few construction workers will accept a 40% pay cut. What has been especially surprising, even to seasoned builders, is the sharp spike in material costs. The increase has been fueled by an uptick in remodeling and commercial construction. The three of these factors keep the cost for new construction higher than for existing homes.
Appraisals for new construction are based on comparing the proposed new home to recently sold homes similar in size and features. Since most sales are from existing stock, appraisals for new homes are often less than the cost to build them. This often prevents banks from lending the full amount needed by the buyer. Unless the buyer has sufficient cash to offset this shortfall, they can’t get a loan for the amount they need to build their home.
Minimize Appraisal Problems by Selecting Optional Features with High Value
So what can you do about this? It always helps to select optional specifications that add the same value as they cost. It helps even more if you choose features that add more value than they cost. Enlarging a modular home, for example, will almost always add more value than it costs, since factory assembly lines are very efficient. On the flip side, removing something that costs more than it adds in value will also bring the cost more in line with the appraisal. For example, replacing fiber cement siding with vinyl siding will substantially reduce the discrepancy between cost and appraisal. The appraised value of vinyl and fiber cement is comparable in most communities even though fiber cement costs much more. Similar results can be achieved by selecting vinyl windows instead of wood windows or by eliminating cathedral ceilings.
Minimize Appraisal Problems by Adding Other Work with High Value
Adding something you might not need, or didn’t want until the future, can sometimes increase the appraised value more than it costs. For example, if you select a cape design with one or two bedrooms on the first floor and an unfinished second floor, finishing a bedroom or two on the second floor might boost your appraisal substantially more than it costs. Of course this assumes you can afford the additional construction. Building your garage now rather than in the future might stretch your budge more than you prefer, but it may also be the only way to eliminate your appraisal shortfall.
One of my earliest customers used to sell homes for a “stick” builder. His interest in a modular home for his family was motivated by two things: faster construction time and better cost controls. However he wasn’t yet convinced that modular homes were better built. And he doubted they were less expensive, at least to start. But from his past experience, a stick home always took longer, which cost more money, and often created sizable cost overruns.
Turning Gray into Black for the Builder
I of course agreed with his points about speed and cost overruns, and asked him to tell me more. He surprised me with a brief anecdote that I’ve never forgotten and often shared with others.
“Let me tell you about my boss. About once a month we’d have a sales meeting and he’d almost always find an opportunity to tell us that our job was to turn gray into black for the company. He never tired of explaining that there were gray areas in his customers’ contracts. It was our job to turn these gray areas into black. The more gray areas the better, since change orders made him most of his money.”
Turning Gray into Red for the Customer
My customer added, “What my boss would never say aloud was what this magic meant for his customers. By turning his contracts’ gray ink into black ink for his bottom line, he busted his customers’ budgets with red ink. I’ll be damned if that’s going to happen to me. Since building a modular home forces you to specify everything in advance, there’s not much chance of being surprised by last minute change orders.”
Turning Gray into Black for the Modular General Contractor
My customer was definitely right about modular homes. (Here is how modular homes help you avoid costly, unbudgeted surprises.) However, as I explained to him, there’s plenty of opportunity for a modular general contractor to write his contract in gray ink for the foundation, site work, button-up work, and construction of site built structures.
Eliminating Gray for the Customer
The real issue is not the type of construction, it’s the type of documentation. Whether you build a stick, log, panelized, or modular home, the only way to avoid the damnable red ink is have your builder fully document the scope of work, specifications, and costs. He should do this by itemizing every detail, and he should specify which items are excluded and which are priced as allowances.
For more information about what your modular home contract needs to include, see here and here and here.
Here’s some advice that’s obvious, but not always followed. If you’re building a home to share with a spouse or partner, make sure both of you are OK with the final decisions.
You might think there’s nothing wrong with one person making all the decisions as long as both of you are comfortable with this arrangement. I agree. But the other person still needs to approve your final decisions to make sure you didn’t choose something they dislike.
When Building a Modular Home, It Is Especially Important that Both of You Approve the Final Decisions
This is particularly important with modular homes, since the factory will build your home to whatever design and specifications you sign for when you authorize its construction. This means you need to be sure your spouse or partner feels good about your final decisions. Otherwise . . . well, let me share a story about a happily married couple.
When Ed and Heidi first came to our model home center, Ed let us know that if they were to select us, his wife would pick the house plan and specifications and control the purse strings. He said he was too busy with work to be involved. Besides he would be happy with whatever his wife decided. That was fine with us, but we couldn’t help wonder how Heidi would handle this responsibility without help, since she already had three children under seven with a fourth on the way.
To Heidi’s credit, once she decided to build with us she quickly finalized the plan and just as quickly selected the materials and colors. She then signed off on her final decisions.
A month before the baby was due we delivered their home. Ed didn’t attend the modular set, but Heidi was there with her parents and a couple of friends, who helped with the children. Ed came that evening and was quite pleased with the house. At least he was until he realized Heidi had decided to have their general contractor install forced hot air heat and air conditioning. Ed had wanted the factory to install hot water baseboards. Moreover, he disliked air conditioning. The next day his opening line to my service manager was, “I am not sure who I should be mad at, you or my wife!”. It never occurred to him that he should be mad at himself!
It’s Always Less Expensive to Get the Final Decisions Right the First Time
We explained to Ed and Heidi that they could still add hot water baseboards to each room. But this would cost them quite a bit more than if the units had been installed at the factory. In the end, they decided to live with the forced hot air heat. However, the last we heard, they still hadn’t installed air conditioning.
It’s perfectly OK to allow your spouse or partner to make all the final decisions. But regardless of how busy you are, or how happy you are letting your spouse or partner do the heavy lifting, both of you should review the final decisions before authorizing your home to be built.
Most modular home designs are one, two, or three modules deep and one or two modules high. A few companies build homes three modules high, although they require special approvals from the customer’s state to ensure they comply with the building code. Most homes are two modules wide, with typical widths of approximately 24 feet, 26 feet, 27 feet 6 inches, and 31 feet 6 inches. Three module wide homes typically range from 36’ to 47’ 3”. The usual practice is to place modules side by side, with the long sides parallel to the road. Some designs, especially when built on narrow lots, turn the modules perpendicular to the road. Modules can also be turned perpendicular to each other to create T-, L-, or H-shaped houses, which is one of many techniques the modular industry has employed to shed its image of making boring boxes.
Modular Home Designs – Minimum Size
Modular manufacturers will build homes only if they can sell them for a competitive price and still make a profit. The minimum order they will take is a function of the amount of labor and materials required to build the home. Too little labor and materials will make a home uneconomical to build at the factory. This means that small additions usually will not work financially, and neither will larger additions that are essentially empty boxes. For example, a 16 foot by 27’6” foot great room addition is usually too small and devoid of value-added work to make economic sense. On the other hand, a 24-foot by 24-foot in-law addition with a kitchen and bathroom can work nicely.
Modular Home Designs – Adding Length
Adding length to a modular home is always easy to do from the manufacturer’s point of view, as long as it stays within the maximum production and delivery dimensions. This is also true about adding bump-outs to the end of a module, such as a walkout bay. Making a plan of a given size bigger by adding to the length of the modules is one of the best values in the entire construction industry.
Modular Home Designs – Adding Width
Increasing the size of a particular plan by widening the modules is also a very good bargain. The cost per square foot is often a little more for adding width than length, because the floor system sometimes needs to be beefed up; for example, from 2 x 8 floor joists for a 24-foot-wide home to 2 x 10s for a home with a width of 27 feet 6 inches. Widening a module, like lengthening a home, will always add more equity to a home than it costs.
Modular Home Designs – Adding a Bumpout
Adding a “bump-out”, such as the walk-out bay, to a long wall on a module that is already at its maximum width is more involved than adding one to the end of a module. The manufacturer must either build the bump-out as a separate miniature module or ship the necessary materials to the general contractor.
Modular Home Designs – Using a Saddle or Cricket
Attaching one or more additional modules perpendicular to the long side, as discussed above can also enlarge a standard plan. This will require that a “saddle” or “cricket” be built to join the roofs.
Modular Home Designs – Adding a Second Living Unit
Another way to enlarge a home is to attach a separate living unit to the home, such as you might do to create an in-law addition or a two-family unit. The second unit can be designed with either a custom or standard plan.
Modular Home Designs – Additional Delivery Fees
When enlarging a given plan, make sure that any additional delivery fees are included in writing. Increasing the width up to 27 feet 6 inches should incur a relatively small fee. The fee for widening a home to 31 feet 6 inches, however, will be more substantial. Adding length to a home will sometimes require additional delivery carriers, which also can add significantly to the cost. This will happen when the original length of the house calls for delivering two modules on one carrier but the new, longer plan requires delivering the two modules on two carriers. Consequently, the new design will require an additional carrier for each pair of modules. For example, if a manufacturer’s maximum length for shipping two modules on a carrier is 30 feet per module, it can deliver a two-module-wide 28-foot-long in-law apartment on one carrier. However, if the apartment is lengthened by 4 feet, making each module 32-feet long, an additional carrier will be needed. When the original plan is a 28-foot-long two-story that is being lengthened to 32 feet, two additional carriers will be needed.
Additional carriers will also be required whenever lengthening a home makes the modules too long for the manufacturer and general contractor to deliver to a site. For example, a narrow road to the site may make it impossible to for a longer carrier to negotiate the turns. The only solution, other than keeping the home at its original length, might be to have the manufacturer divide each longer module into two shorter modules. The manufacturer will charge more to do this, but it may be the best way to get the home you want.
Modular Home Designs – Additional Option Costs
Enlarging a home will also increase the cost of any options that are affected by the increase. For example, upgrading to a premium siding will cost more when a home is made wider or longer, since more area needs to be covered. Other optional features will only increase in price if a particular room increases in size. For example, a dining room wood floor will only cost more when a home is lengthened if some of the additional length is put into that room. Increasing the size of a particular room can also force you to add windows or doors to meet the building code, which requires a minimum amount of “light and vent” for each room.
Are you considering having your parents move in with family? If so, are you considering building an “in-law” addition to your home to provide them (and you) with a private space? Perhaps you are even considering making it a temporary addition, which can be removed when you no longer need it. Unfortunately, you probably will need to build your addition as a permanent structure, since very communities allow truly temporary additions. It’s not been for lack of trying, however. Here’s a little history.
Elder Cottage Housing Opportunity (ECHO)
It started with the fact that families are sometimes prevented by local zoning regulations from building an in-law addition in single-family neighborhoods. There are several reasons why communities pass regulations that exclude such in-law apartments. The two most common are to preserve property values and safeguard neighborhoods from transient residents. In the early 1980s, the American Association of Retired Persons (AARP) proposed a zoning solution that would respect these concerns yet allow families to build an apartment for their elderly parents. The proposal became known as the Elder Cottage Housing Opportunity program (ECHO).
The core idea of the ECHO program was to allow a family to build an in-law apartment on their property as long as they agreed to remove it once their parents moved on. After the temporary addition was removed, the property would be restored to a single-family residence, bringing it into compliance with the community’s zoning restrictions. To make this possible, the temporary addition would either have to be discarded or relocated. Virtually all advocates of the program recognized that a modular home would make it possible to relocate and reuse the apartment each time the occupants vacated it.
In theory, the ECHO program worked on multiple levels. Many families who want to help care for their elderly parents are not looking to create a permanent in-law apartment. They do not want to maintain it or pay the additional taxes, they are not interested in becoming landlords after their parents no longer live there, and they would like to reclaim that part of their yard that has been taken over by the apartment. On the other hand, they do not want to dispose of an in-law apartment that is in usable shape. They would prefer to recoup some of their investment by perhaps passing the apartment on to another family who needed it.
Unfortunately, the ECHO program has yet to take hold. The necessary zoning regulations have not passed. Fortunately, many communities already have zoning regulations that allow for a permanent in-law addition. And they also allow for these structures to be dismantled in the future, as long as you obtain a permit and comply with the regulations. The one caveat, however, is that you must build the temporary addition as if you intend to keep it as a permanent apartment. This means it must comply with all building codes that apply to a new residential home.
Temporary Modular Addition
An advantage to using a modular home for a temporary in-law addition is that it can be disassembled into a few intact sections that can be easily relocated. This is seldom a viable option for a stick-framed addition. The disassembly of a modular temporary addition requires that the general contractor (GC) carry out the same steps he executed to button-up an addition, but in reverse. This should take considerably less time and cost considerably less money than the assembly. The GC would likely need to do the following:
( ) Disconnect the plumbing, electrical, and heating systems
( ) Remove the siding where necessary
( ) Separate the modules at the marriage wall, inside and outside
( ) Lower the roof on each module
( ) Lift the modules off the foundation with a crane and crew
( ) Place the modules on rented transporters that have all of the necessary permits
( ) Deliver the modules to their next home
( ) Restore the property to its original condition, including removing the foundation
The disassembly of the temporary modular addition will render some of the materials unusable for the next owner. Some of the shingles will need to be replaced, for example, as will some plumbing and heating components installed in the basement. If you are buying your modular addition directly from a modular manufacturer, consider buying extra materials so the next owner will have matching replacements when it comes time for them to reassemble the addition.
Remodel the Inside of Your Existing Home When Building a Modular Home Addition
To make the floor plan of your current home flow nicely into your modular home addition, you may need to do some remodeling. If you add a second-story modular home addition, you will certainly need to build a set of stairs to the second floor. But you may also want to rearrange your current floor plan. You might remodel your home to update some features; kitchen and bathroom renovations are particularly popular choices. Or you might remodel to improve the layout. When building a second-story modular home addition, for example, you might accomplish this by making two of the existing bedrooms into a great room or by carving out a bigger kitchen and formal dining room. When building an attached modular home addition that contains a new master-bedroom suite, kitchen, and formal dining room, you might make the old country kitchen into a breakfast nook and mudroom.
Dress Up the Front of Your Existing Home When Building a Modular Home Addition
You may want to use the modular home addition as an occasion to dress up the outside of your home. In fact, you might not have a choice, since the siding, shingles, or windows may need to be replaced to match the addition. Replacing or refinishing all of these materials in your existing home can be expensive. On the other hand, it might be the perfect time to do so if they are worn out.
Add a Deck or a Porch When Building a Modular Home Addition
Building a modular home addition is often the perfect time to add the deck or porch you have always wanted. It is usually more affordable to do these small projects while a general contractor is already completing the other work at your home. Your lender may also be willing to increase your mortgage by the relatively modest amount needed to take on these projects.
Remodeling Can Be Expensive, Even When Building a Modular Home Addition
Remodeling, however, can be expensive, and the true cost is often hard to pin down in an older home until the work has begun. If you are having a GC do some remodeling, you will want to understand what he is assuming responsibility for doing and what he is excluding from his contract. You will definitely want to set aside a good-sized contingency fund.
Modular dealers and manufacturers are responsible for building homes that meet the state’s building codes. However, the customer or general contractor should check with the local building department to learn if they enforce any building codes that differ from those of the state. If any governmental institutions are financing the home, they may also have specific code requirements. If any adjustments to code requirements are necessary, the dealer should be told soon enough to incorporate them into their order with the manufacturer. Any additional costs will be the responsibility of the customer.
Preemptive Building Codes
In theory, this should not be a concern in any state with a preemptive building code, since all building inspectors in that state must comply regardless of their personal preferences. In practice, however, some local inspectors will choose to enforce a few more stringent building codes, or a few building codes more stringently, sometimes without recognizing that they are doing so. Knowing this in advance can prevent conflicts down the road.
Modular builders in Greenwich, Connecticut, the shore of New Jersey, Westchester County in New York, Atlanta Georgia – indeed, across America – have built several multimillion dollar modular mansions. Certainly part of what makes these homes so expensive is the cost of the land. But it is the things these modular builders are doing to make their homes into modular mansions that makes them sell quickly to very happy customers.
How to Make Modular Homes into Modular Mansions
Some of the builders start by working closely with an architect.Allof them select manufacturers who have creative engineering departments and flexible purchasing and production staffs as well as experience building several modular mansions over the years. They complete many of their modular mansions exterior embellishments and interior and exterior flourishes on site with local subcontractors. Some builders use top-of-the-line production cabinets, while others install custom cabinetry made by a local woodworking shop. The same goes for interior doors and moldings, with custom crown moldings, chair rail, and wainscoting complimenting impeccably detailed window and door trim. It is not uncommon for the builders to skim coat all of the drywall with plaster before repainting the entire home. They finish it with custom hardwood, tile, and laminate flooring. And they landscape the property to perfection.
Why Build Modular Mansions in Multi-Million Dollar Neighborhoods
Why do these builders use modular homes to construct multimillion-dollar mansions? Cost is one reason, of course, but reliability, speed, and quality are the principle incentives, since the local subcontractors are too busy and their quality is too inconsistent. With such success, these cutting-edge, luxury builders have no intention of going back to stick construction. And neither should you!
You may be tempted to act as your own modular home general contractor but are afraid of getting in over your head. And rightfully so! That’s why I don’t encourage those without construction experience to take the do-it-yourself route.
Why You Might Act as Your Own Modular Home General Contractor
Although I strongly recommend hiring a professional general contractor with modular home experience, modular home construction is a much better way to act as your own general contractor while building your first home. This is primarily because there is less on-site construction work to do than with stick building and it is more defined and manageable. Also, if you want to complete some of the construction tasks yourself, you are less likely to be overwhelmed by the work because the tasks are more limited in scope. If you’re considering acting as your own modular home general contractor, I strongly recommend that you purchase a copy of my book, The Modular Home. Although it will not turn amateur home builders into modular professionals, it will to help you make the right decisions and stay on budget and on schedule.
Customers often ask whether modular home resale value is the same as for a comparable site-built home when it is first built and later when it is resold. As far as professional bank appraisers are concerned, the answer to both is yes.
Why Modular Home Resale Value Is Strong
When a bank appraiser assesses the value of a site-built home and a modular home that are built to the same specifications and located in the same neighborhood, she applies the same appraisal rules to both homes and comes up with the same value. Likewise, most people shopping for a new home evaluate a house with their eyes in terms of its perceived quality. Few people have any idea who built a house or how it was built, and most really do not care. Once a house is constructed, its resale value is determined by how it appears to potential buyers, not its pedigree. What matters is whether you select a good house design, equip it with desirable amenities, and have it designed by an experienced modular home builder. Then your modular home needs to be built by a quality-conscious manufacturer and general contractor and located in a desirable community. If you do all of these things, you will do very well on your modular resale value with both appraisers and customers. The same holds true for stick-built houses. In other words, neither form of construction has an advantage when it comes time to resell.