Disadvantages of a Modular Home

Modular homes are built by transporting pre-fabricated components to a building site, where they are pieced together into one structure. The lower costs of modular homes in comparison to traditional “stick built” houses have made them increasingly popular.

Cost is one of the many advantages of getting a modular home, but there are also several disadvantages associated with these types of buildings.


One major difference between a modular home and an existing stick built home is the land that the home sits on. In order to purchase a modular home, you must already own the land it will be placed on. Many builders will divide land into lots, build traditional homes on site, and sell the property and structure at one price.

When purchasing a modular home, the price is typically for the building only and the cost of the land must be added to the total investment. In some cases, depending on location, it could cost as much or more to buy a modular home and land as it would to buy a stick built home that is priced with the property included.


Although modular homes are usually built using high quality craftsmanship that is similar to traditionally built houses, they are often thought of as inferior, and similar to such manufactured housing as the doublewide trailer. This is a misconception that continues to exist.

Because of these false notions, the value of your modular home may not be as high as it should be when it comes time to sell it. Despite the fact that banks may lend to buyers in the same way they would for a stick built home, the potential buyer may still feel like the house isn’t worth as much because it is a modular building.

Money Up Front

When a builder constructs a house, they are typically paid as the work is completed over several months. With a modular home, the builder will be constructing the majority of the home off site and will deliver and set up the building almost completed. For this reason, the builder usually wants payment in full for the home before the expense of building it is done. Some mortgage companies may issue a construction loan for the upfront payment, and replace it with a mortgage later, but getting all of the money initially could be difficult for some borrowers.