What Is the Difference Between Site Built, Modular, On-Frame, Modular and Manufactured Homes?
Four Categories of Construction
There are many forms of home construction available on the market today. Broadly speaking, these can be broken down into three categories: Site-Built, Modular, Manufactured and the sub-category of On-Frame Modular homes. So, what is the difference between Site-Built, Modular, On-Frame Modular and Manufactured homes, and how can you tell them apart?
The most common form of residential home construction is the “Site-Built” home. A Site-Built home is the kind most often thought of when we think of a single-family residence. A foundation is laid, raw materials are brought to the site, and assembled by a contractor on the property. A Site-Built home is most often made of wood-frame construction (i.e. “stick built”), but can be built in a variety of other materials, including brick or concrete blocks. Site-Built homes are constructed according to local building codes, and can be built in two story (or more) elevations. Site-Built homes offer endless customizable options limited only by your imagination, the building codes, and your budget. Site-Built construction typically takes from as little as 3 months, to a year or more, to complete.
Modular homes are constructed using similar techniques and materials as a Site-Built home. However, they are fabricated in sections at an off-site factory rather than built on-site. Sections are brought to the site and assembled on a concrete slab foundation, crawl space or basement. Modular home construction is becoming more common, due to improved quality control, cost and efficiency in construction techniques. Just as with Site-Built homes, Modular homes are built according to local building codes, and can be two or more stories. Site-Built and Modular homes tend to appreciate in value at about the same rate.
The sections of Modular homes can be sturdier than Site-Built construction (e.g. a FEMA study found the Modular homes withstood the forces of Hurricane Andrew better than Site-Built properties). A Modular home can be ready to install on your foundation in as little as 4 weeks, and the assembly process at the building site usually only takes a few weeks more. In some instances, the Modular home is less costly than standard Site-Built construction, but the flexibility of the design is more limited. Both Site-Built and Modular homes can be financed with traditional mortgages.
Manufactured Home | Trailer
Manufactured homes come in various types, including Mobile homes and Trailers. Like Modular homes, they are built in factories. Manufactured homes do not, however, conform to local building codes. Instead, they are built according to the more forgiving Federal standard (the “HUD Code”), and are often made of inferior materials. They are built on a non-removable metal chassis and then transported to the property on wheels. Sections are joined together for larger Mobile homes, like "double-wides" when they arrive at the property. "Trailers" are most often single-wides.
In most cases, after a Manufactured home is delivered, and located near pre-installed utilities (gas, water, electricity, and/or sewer/septic), it is placed on stands or concrete blocks. Often, the open area of the stands/blocks is enclosed with skirting to cover the wheels and chassis. Alternatively, they might be mounted on fixed foundations at the property. While building inspectors do not review the construction of Manufactured homes, inspections and permits are required for any utility hook-ups.
Manufactured homes tend to depreciate over time, and have a shorter usable life-span than Site-Built or Modular homes. They are also more difficult to remodel and/or repair. Manufactured homes can be placed on concrete foundations containing a basement, but the structure itself will always be comprised of a single story. Manufactured homes are in a separate lending category compared to Site-Built or Modular homes. This category is more like a car loan than a mortgage (personal property, as opposed to real property). As a result, Mobile homes and Trailers require a HUD tag and VIN registration, because they are designed with wheels and chassis in order to travel on roads. Mortgages for manufactured homes typically have a higher interest rate than Site-Built or Modular home loans. The resale value of a Manufactured home will also be less than similarly sized Site-Built or Modular homes.
Most states allow owners to “de-title” Manufactured homes to become real property. This allows the home and the land it rests on to be secured with a traditional mortgage (and to give the property additional legal protections afforded to real property, which are not given to “personal property”; see https://nclc.org/images/pdf/manufactured_housing/cfed-titling-homes.pdf for more details). While standards vary from state to state, one common requirement is that the Manufactured home be affixed to a permanent foundation.
In North Carolina the state law allowing this is detailed under NC Code – General Statutes § 20-109.2 (see https://law.justia.com/codes/north-carolina/2005/chapter_20/gs_20-109.2.html). If a Manufactured home is fixed to a permanent foundation and “de-titled”, it can secure mortgages offered under FHA, VA and USDA programs, as well as some conventional loans. Manufactured homes are typically less expensive than Site-Built and Modular homes. They can also be moved from location to location (although, with larger Mobile homes, this can be an expensive and complicated undertaking, because special permits are required, and professional movers needed).
On-Frame Modular Homes
Recently, some makers of Manufactured homes have created Manufactured/Modular Hybrid homes which they claim to be “On-Frame Modular homes.” These so called Hybrids are typically built with lower quality materials to make them more affordable, yet built to the minimum local and state codes (instead of the “HUD Code”) so that they can be marketed as Modular, and thus can be sold & financed as “real property.” They are not true Manufactured homes, nor are they true Modular homes. Like typical Manufactured homes, these Hybrids are built on permanent steel frames.
Most lending institutions and local planning offices have become wise to their effort, however. If a home has a permanently attached steel frame, they may still be treated as Manufactured homes, even though they may be code-compliant to technically pass as a Modular home. Due to their steel frame construction, these Hybrids can never be more than single story structures.