Thursday, April 25, 2013

8 Intrinsic Values of Modular Home Construction

Whenever a site builder asks me why they should go modular, they are really asking me how they can make more money going modular. Some of them are long time site builders that have looked at converting to modular construction and just can't bring themselves to pull the trigger. It's time for a change in attitude toward modular construction.


What they haven’t heard are the intrinsic value modular home building can bring to their business. I would be willing to bet that not many factory sales reps even know many of the things that make modular construction a better way to build homes.
  1. Less waste at the jobsite: Saving estimates run as high as 75% at the jobsite. That doesn’t mean that all that waste is transferred to the factory dumpsters. Almost all factories use the waste lumber for extra cross bracing behind cabinets, receptacles and a couple even grind up what can’t be used into sawdust to fire the furnaces in the winter. Drywall is sold to recyclers along with the cardboard. Very little goes to waste at the factory.
  2. Less time to completion: Getting a new home buyer to sign on the bottom line after choosing a floorplan, colors and the builder checking the lot takes the same amount of time for both the site builder and the modular home builder. After permitting and obtaining a mortgage, both builders begin the process. On average, a custom home site builder can complete a home within 6-8 months of excavation. Because the factory begins the building process of the home shortly after the contract is signed, they deliver the modules after the foundation is completed. House for house, there is less work at the job site when using modular construction so most of the items are final finish work. Time savings can be significant.
  3. Predictable scheduling: Unhampered by rain and mud, the factory can give their builders a timetable that helps the builder schedule subs. Sometimes things happen but for the most part a modular home builder can plan his schedule better than a site builder.
  4. Skilled labor pool: As new home construction picks up, one area that is lagging behind is the skilled labor that was available during the house building boom of a decade ago. The Dept of Labor estimates that only one in ten skilled construction laborers have returned to housing and that will not get better until housing shows even more improvement. On the other hand, the modular home factory has a skilled labor pool that worked throughout the tough times. When they need more help on the production lines, the experienced workers are the ones training the new ones.
  5. New Products and Technologies: When a site builder wants to know what’s new in home construction, they usually visit the lumber yard or ask one of the subcontractors that work for them. Adding new products to their options list is not easily done. But modular home builders have a big ally in helping them with new products. They will see the product added to the factory’s options list or learn about it from the factory sales rep. A lot of times, the builder will simply ask the factory about a new product they heard about and within days, information and pricing magically appears.
  6. Inspections, inspections, inspections: How many times does a site built home get delayed because it didn’t pass the rough framing inspection or the rough plumbing inspection and the builder had to wait until the sub came back to repair the defect and wait again to get back on the inspectors’ list? With modular homes having a third party inspect the floor plans, framing, electrical and plumbing before it leaves the factory, you will save a lot of valuable time that can be used for other things, like meeting with prospective new home buyers and signing contracts or going to your child’s soccer match.
  7. Consistent construction procedures: Every house can be an adventure when you site build. If you have two houses being built at the same time, you may find that you need two different subs to do the same job in your two homes. Is the quality the same in both? Are they using the same materials? Are both subs using qualified labor? No need to worry with a modular home built in a factory. Skilled people do the same job on each house using factory approved materials and procedures. Another plus for modular construction.
  8. Predictable costing: Nothing puts the damper on a site builder’s day more than a price increase from the lumber yard without any warning. Drywall goes up 17%; they don’t tell you. Lumber goes up 4%; nobody told you. With modular home factories, you will be told in plenty of time to make a decision before the house is ordered. The price on the contract is the price you pay and with modular accounting for about 75% of the total material cost of the house, most of your increases will usually fall on your subs that do the finish work.

For all you site builders, small and large, what is stopping you from at least taking a day and visiting a modular home factory and seeing for yourself the real advantages modular offers?

1 comment:

Anonymous said...

Coach, another great list of reasons for a builder to go modular. I converted about 15 years ago and when housing bottomed, I didn't have anyone to let go or a material inventory to worry about. I moved into remodeling until recently and when I called my factory it was like I had never left. They are my labor expense and my material storage and I love it.