THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Saturday, March 18, 1995 TAG: 9503160286
SECTION: REAL ESTATE WEEKLY PAGE: 10 EDITION: FINAL
COLUMN: ABOUT THE OUTER BANKS
SOURCE: Chris Kidder
LENGTH: Long : 123 lines
This week we're looking at the ``M'' words in housing: modular and manufactured. Each is factory built; both travel from the factory to the homesite by truck. Neither is what it used to be, and for modular housing, especially, the changes are making it one of the fastest upscale housing trends in the nation.
But before we talk about what modular homes are, let's talk about what they're not. They're not trailers, not mobile homes, not manufactured housing as the federal government defines it.
. Federal law in 1985 said a manufactured house is one built on a steel chassis with wheels. From that point on, the mobile home and trailer had a new name. Mobile homes needed a new name. These metal mansions are hardly mobile these days. Unless you own a Mack truck, you won't be packing up the house and driving it to Arizona.
Since 1976 when the federal government began regulating the industry, mobile homes have become sturdier, safer, roomier and more energy efficient. That's an improvement over the pre-1976 mobile home, said a HUD official I interviewed in 1992, but ``you're talking about aluminum walls.''
You're also talking about a product that in most cases, until recently, was taxed and titled as personal property not real estate. Lenders treated its financing as a consumer loan not a house mortgage.
Today, manufactured houses that meet certain requirements can be considered real estate for lending, tax and title purposes.
Suffice it to say that these manufactured homes are a unique product bearing little structural resemblance to what the industry calls modular homes.
But these ``M'' words are confusing. The former mobile home is not the only type of house built in a factory. And manufactured homes shipped to a home site in pieces - as double-wides are - are, by Webster's definition, modular.
When it comes to houses, the term ``modular'' is just as misunderstood and misused as ``manufactured.'' A good rule of thumb is to never use the two ``M'' words in the same breath, especially when talking with your builder, your real estate agent or your lender.
A modular house is built in three-dimensional sections at a factory on a conventional substructure. A modular house is always considered real estate and is taxed and titled as any stick-built house.
A stick-built house, by the way, is a house assembled on site from the foundation up, although it may contain prefabricated materials like roof trusses or framed-in doors.
When entire wall units are assembled off-site and trucked in, the house is ``panelized.'' Panelized building is a hybrid construction form that's a little bit stick-built, a little bit modular, and the second most common form of factory-built housing, after manufactured (mobile) houses.
Although panelized building is inherently flexible, its economies work best for builders who build the same houses in large quantities. If there's one constant about today's home buyers at the beach, it's that nobody wants the same house.
Vast tracts of the same house, you ask? If you're like most of us, you've seen the 1950s vision of suburbia - box-like prefabs lined up block after block - and it sounds like modular construction to you.
The vision is outdated.
Modular homes now account for about 8 percent of all houses built in the United States. That market share is expected reach 12 percent by the late 1990s.
Yes, modular manufacturers are still building small houses. Their product makes good sense for the lower-end market. But fewer than 50 percent of all modular homes built fall into the under-$75,000 - or ``FmHA house'' - category.
In 1990, 10 percent of all single-family modular homes built were priced over at more than $200,000. The upper-end market share has continued to grow. Houses with million dollar price tags and 12,000 square feet of pure luxury are being built with modular construction. And if you think these buyers are paying that kind of money for a glorified mobile home, think again.
Modular homes, because they are flexible, can be just about anything you want them to be. Think of them as building blocks: They stack, they sit side by side or stretch out end to end. The possibilities would be endless except that each module is limited in size by highway transportation (in North Carolina, the maximum size allowed on the roads without special permission is 14 feet wide by about 70 feet long).
With the advent of computer-assisted design and drafting systems, virtually any house plan can be adapted to modular construction within hours. Once these houses are set on their permanent foundation, there is nothing to set a modular house apart from a stick-built - unless you want to count the extra wood. A modular house, on average, contains 30 percent more lumber than a stick-built house because the frame is reinforced for shipping.
Modular homes are built to the same state building codes used for stick-built homes. In the factory, inspections are carried out by certified third-party inspectors and company quality control people.
Manufacturers, like builders, build products of varying degrees of quality. But it's fair to say that, because of the economic realities of manufacturing, that the quality and price of modular housing is consistent within its own market segment.
The biggest obstacle modular homes face is mistaken identity. People hear ``modular'' and they think ``mobile home.'' There's no question that the terminology is confusing. Modular manufacturers would like to substitute ``building system'' for modular. That might work - except it doesn't start with ``M.''
(If you're curious about modular building, we'll be telling you more about it over the next eight weeks. Starting next week, we'll be looking at the construction of a 3,300 square-foot, modular, oceanfront vacation home in Nags Head. We'll follow the house from its beginning at the Nationwide Homes factory in Martinsville, Va., through its completion and first rental week in April.) MEMO: Send comments and questions to Chris Kidder at P.O. Box 10, Nags Head,
N.C. 27959.
ILLUSTRATION: DEFINITIONS
Manufactured house: A dwelling built on a steel chassis with
wheels.
Modular house: A dwelling built in three-dimensional sections at
a factory on a conventional substructure.
Stick-built house: A dwelling assembled on site from the
foundation up, although it may contain prefabricated materials like
roof trusses or framed-in doors.
Panelized house: A hybrid construction form that's a little bit
stick-built, a little bit modular. Entire wall units are assembled
off-site and trucked in.
by CNB