When getting the most for your dollars really counts, it pays to know what you're shopping for. When it comes to new homes, a mistake can be very costly. Over the years of coaching people in their purchases and home building projects, I've learned what confuses people the most. And how to help them.
One of the most common questions centers around how prefabricated homes are classified for appraisals and lending purposes. Can you answer it? You'll know now!
Question: What's the difference between Modular Homes and Manufactured Homes?
I've found that many people are just not sure. There's plenty of confusion to go around. Just what is the difference between a modular and manufactured home? Or, is there a difference?
Yes, there most definitely is a significant difference between them. It's not entirely a quality issue either. Here's what I mean.
A Different Home Classification
The underlying issue is the category under which they fall. A manufactured home is not considered a true, stick built / site built home. They are technically considered impermanent "vehicles" on wheels and as such, they do not have the same appraised value as a site built / stick built home. Nor do they hold their appraised values over the long haul.
Modular homes, on the other hand, are considered stick built homes just as a true "site-built" home would be. And, as such, are usually appraised in the same fashion, given the same value, and hold their appraised value the same as a traditional site built home.
It's Not a Question of Quality
If you've been shopped for manufactured homes, you've probably impressed with their similar quality. While that's good, it does not change their classification. So, even though many manufactured homes have increased their quality in recent years, you should be aware that a poor appraiser is likely and that declining values over the years is extremely likely.
What is your goal? Are you thinking about long-term value? If choosing between a modular and a manufactured home, you need to focus on your priorities in order to make the right decision for you.
In my experience over many years, when selecting between these two choices, if you're looking for long term value over mobility, I'd go with a modular home every single time.
Do your research and decide what's important to you.