Fighting the Stigma

These people are working to correct the misconceptions that many have about modular construction.

• Too many homebuyers still confuse modular homes with manufactured homes. Overcoming this confusion means helping them understand that modular is a process, not a building type.
• The misconceptions aren’t limited to buyers: even some industry pros have trouble getting past the misconception.
• Modular manufacturers and builders can help by actively educating consumers and pros alike, and by helping get media coverage for quality modular homes.

In June of 2023, author Sheri Koones spoke at the National Association of Real Estate Editors conference. While many in the audience were journalists, a lot of attendees work in various facets of the real estate industry. Koones was there to talk about her latest book, Prefabulous for Everyone, one of several she has written about the modular home industry. Her mission has been to dispel common misconceptions about this way of building.

“The truth of the matter,” she says “is that a lot of people — consumers and even those working in the housing industry — don’t know anything about prefab. And if they do know about it, they have misperceptions about how big or attractive or [intricately designed] a house can be.” In addition, the view remains that modular homes are trailer homes, which carries a negative stigma.

With a building method defined by its speed, creation of less waste, better use of labor, opportunities for lower cost and myriad other benefits, how can the industry change the negative perception?

It’s a Process, Not a Product

Prefabrication is not a new concept. In the 19th century, according to the National Park Service, London carpenter John Manning shipped his “Portable Cottage” to America to be pieced together on-site. Then, in the early 20th century, there were the Sears kit houses.

The Sears homes were well-regarded, but they weren’t what ultimately came to define manufactured homes. That honor goes to the mobile, or “manufactured,” home popularized in the 1950s. The image of a group of houses on wheels set off in a less attractive part of town has been incredibly sticky. It’s what many people think of when they think of this industry.

For instance, Cecil Provost, a realtor and homebuilder in Saratoga, N.Y., admits that even he had some preconceived notions about modular construction before starting his building companies. That changed fifteen years ago, he says, when he helped a doctor buy a custom-built house.

“I was blown away during the home inspection that it was modular. It had an 18-ft. coffered ceiling. It was spectacular. I saw that I had been making assumptions that just weren’t right,” Provost says. That home sale set Provost on the path to learning more about modular building and offsite construction, and eventually to the opening of Saratoga Modular Construction. (He also owns a separate, traditional building company, Saratoga Construction.)

In the beginning, Provost says, “we had more resistance to our homes because no one in our market was doing custom builds with modular. They were only offering ‘double wides’ [a style of manufactured home].”

In the years since, Provost has built around 300 homes in the region, about 75% of which are modular. One of the first modular homes he built was on Lake George. It got a lot of press coverage at the time and is now worth $5 million.

His favorite story is about the rebuild of a fire-damaged historic home in downtown Saratoga Springs, which was written up in the newspaper. “A neighbor to this project was quoted as saying he ‘didn’t want a two-story trailer park’ next to his house,” Provost recalls. “When we were done, the project won an historic preservation award from the city and the home is now worth eight times what the neighbor’s house is worth.” 

One thing Provost does to counter resistance is to focus on educating buyers that modular is not a type of house. “It’s a process for building a house,” he says. “We don’t sell modular homes; we custom design and build and part of the process is deciding how we’ll build, whether it’s stick built or modular.”

He says that homebuyers really just want to know whether the home will be less expensive, if it will be built as well and if it will hold up over time.

Buyers (and Others) Be Aware

Education about prefab can’t just be for the consumer. There’s a whole universe related to the building industry, from lenders to home inspectors to realtors.

Ilyce Glink, author, speaker and financial wellness expert, says in her experience, “realtors understand very little about what modular homes are. They confuse modular and manufactured and mobile homes.”

She suggests that modular manufacturers could reach out to the realtor community in a better, smarter way, and believes that some of that is starting to happen with the rise of the Tiny House industry. “People are getting to watch these homes being built in HGTV-real time (as opposed to real-real time). But it’s helping to inform the world a little bit more about the quality of modular homes.”

Although realtors play a big role in the homebuying process, they don’t learn a lot of specifics about building construction, admits Century 21 Realtor Leah York, who teaches courses on buyer representation and new construction to other realtors in her Forth Worth, Texas market.

York thinks the stigma about modular “comes from a lot of inconsistent vocabulary,” i.e., mobile homes, double wides. “When we talk about a wall being constructed elsewhere and assembled on-site most realtors and consumers say, ‘That’s fine.’ That doesn’t scare them. But if something is said about it being rolled in on wheels and then put together, that makes them nervous. I think they also fear what it might mean for a lender.”

Kerry Langley, a Senior Loan Officer with Prime Lending in Atlanta, Ga. disputes the idea that lenders don’t understand the differences between modular and manufactured homes. If the house being described by a prospective homebuyer is not on a chassis with wheels, Langley says, “I ask, ‘What does it cost and how much do you need to borrow?’ I’m assuming it meets local building codes.” He believes most other lenders do the same and that many don’t pay attention to the details and don’t ask questions about how structural work gets done.

Both Langley and York agree, though, that buyers’ main concern is what their monthly payment will be. “And whether a house feels like ‘quality’ when they walk through it,” says York, who adds that if there were a class on modular construction offered in her market, she and other realtors would attend. “Homebuyers don’t always ask about energy efficiency or sustainability. We have to educate them and help them make their own decisions.”

Be the Solution

Education has close ties to marketing. To really increase interest in modular homebuilding, it’s going to take a concerted effort by everyone — builders, developers, realtors — along the homebuyers’ journey, says S. Robert August, President at North Star Synergies, a marketing management and sales consultation firm. He would like to see more articles in consumer magazines and trade publications, in print and online. He also believes that economic conditions in general may help more builders become interested in modular.

With 50 years’ experience working with the building industry, August says he’s been “through eight downturns, and out of each one, innovation and creativity has taken place.” For instance, the increasing complexity of homebuilding, is an opportunity for any system or technology that can simplify things.

August says that while it used to take 75 vendors, trades and service companies to build one home, “you now have to work with 125 companies to build that same single-family or multifamily home. You’re out there looking for different companies to work with and that’s a juggling act beyond compare. The result is that builders haven’t had the ability to think about making technological changes because they’re so caught up in production and labor concerns.”

There’s a silver lining for building systems and offsite companies here. If done correctly, says August, “they’ll make a difference, and we can see an evolution.” He believes the big national builders will get on board.

Glenn Phillips, CEO and Lead Economic Analyst at Lake Homes Realty, based in Birmingham, Alabama, also thinks the modular industry has a marketing problem. “From the builders’ perspective, modular is a great product and they don’t know why everyone doesn’t want it.

“But modular has to be the solution, and homebuyers don’t see that there’s a problem to be solved,” he continues. Consumers need to figure out that modular can get them more house for their money or that its quality will mean a higher resale value.

Reaching consumers might be up to people like Koones, who has become a bit of an offsite construction evangelist. The game changer for her was having a home built for her family the traditional way. “My whole neighborhood was impacted. There were trucks coming in and out. There were dumpsters. There were workers who smelled of alcohol,” she says.

Once she learned about modular, she realized “there are a ton of advantages. The houses are stronger, they’re better built, they’re more energy efficient, they go up faster, they can be less expensive. The reason that people build a home the traditional way is because they really don’t know the options.”

Stacey Freed is a freelance writer and editor based in Pittsford, New York. She focuses on construction, remodeling, real estate, sustainability and wellness.