2023 Building a House vs Buying a Pre-Fab, Manufactured or Modular Home
2023 Building a House vs Buying a Pre-Fab, Manufactured or Modular Home
Is it better to build or buy when you have land in 2023?
The housing crisis extends beyond the traditional neighborhood real estate market. Soaring land prices across the country have taken land ownership out of reach for many. If you are fortunate enough to own land and are planning to add a home to it your choices boil down to build or buy.
Build vs Buy
We recently posed this question to our friends on Indie’s personal Facebook account. Of the 31 comments we received most recommended we go with a pre-fab. Let’s dig deeper and see which option is better in post-Covid America, why consumer sentiment has shifted and which option we’ve decided to go with.
Build
We will be using a traditional stick frame house for comparison in this category. There are many alternative ways to build a home, but there is little data available to evaluate them as far as cost is concerned.
Cost to build varies wildly from state to state and even within states. Homebuilding is highly localized, with materials and trade availability dictating market cost. Keep in mind these stats are averages and your local market may be higher or lower.
$288,306
Is the average cost to build in the US (Jan 2023). This is for a 3-4 bedroom, 2000-2200 sq ft home with standard finishes. The per sq ft average is $150. The east and west coasts are highest while the south is lowest.
Material costs account for 60% of the total, while labor is the remaining 40%.
These figures do not include any site work, development costs or infrastructure. In other words, it doesn’t include a septic system, the excavation work and site prep for the house, bringing in utilities, etc. This is just the house itself.
$421,000
Is the average cost to build when you factor in these additional development costs.
Time to Build
Owner built homes take on average 12 months from breaking ground to move-in. Contractor led custom builds come in at a 9 month average.
Buy
There are a lot of options for buying a ready made home. The most popular is the manufactured home, or the classic double wide. Modular homes and pre-fabs are not as common, more expensive and harder to find. For our example we’re using a double wide manufactured home of comparable size to the site built average above.
$179,500
Is the average cost to buy a 2000-2200 sq ft manufactured home with standard finishes. This price includes delivery and set-up. It does not include any site work, infrastructure, utilities or other development costs.
Time from Purchase to Set-up
In Spring 2023 the average time for a manufactured home is 8-12 weeks, but that is dependent on location and manufacturer. We found very fast turnarounds in the south (2-3 weeks from order to delivery) and longer in the west & northeast (up to 3-6 months).
DIY Build
Our example home can be constructed by an owner builder for the cost of materials alone if they’re doing all the labor. If you do not have the skill set to do everything, factor in the labor portion on the trades you want to outsource. The average savings for a DIY build is 15-20%.
Which Option Did We Choose?
We decided to build, and we’re doing a hybrid model. We hired a builder to construct us a site built “manufactured home.” We loved the layouts of so many of the manufactured homes…they’re efficient, flow well and maximize space without a bunch of wasted angles, hallways and balconies.
Here’s the home we liked the best, it’s a Clayton.
After a cup of coffee and a conversation with a small contractor we tasked him with drawing up a sketch that’s similar to this AND could be built for the same or less than Clayton wants for it ($149,900).