What Is the Difference Between a Modular & a Manufactured Home?

Both manufactured and modular homes are constructed off-site, but that's where the commonalities end. Manufactured and modular homes are built to different standards. Manufactured homes are built to national Federal Construction Safety Standards Act codes, and modular homes are built to local building codes. Almost all municipal agencies approve modular homes in locations where the lots have been zoned for that density, and there are far more zoning restrictions on where manufactured homes can be placed.

What Is the Difference Between a Modular & a Manufactured Home?
What Is the Difference Between a Modular & a Manufactured Home? (Image: Goodshoot/Goodshoot/Getty Images)

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How Are Manufactured Homes Built

Manufactured homes are built in climate-controlled factories. They all have steel frames and axles beneath them. Almost all the components for manufactured homes are installed at the factory, including kitchen cabinets, windows, doors and some of the flooring. Manufacturers install wheels on the homes and they are trucked to the sales lot or to the buyer's destination.

Manufactured homes can be built as single-wide homes, double-wides and even two-story homes. Zoning regulations stipulate where the buyers can put their homes. Some people get temporary permits to place a manufactured home on a residential lot as temporary housing.

Others place manufactured homes on leased lots. By law, manufactured homes are considered vehicles, since they have axles, so when the original owners sell them, it's often at a depreciated price.

Manufactured homes can be built as single-wide homes, double-wides and even two-story homes.
Manufactured homes can be built as single-wide homes, double-wides and even two-story homes. (Image: Patrick Roy/iStock/Getty Images)

How Are Modular Homes Built

Modular homes are built in factories but are assembled on-site. The homes are built in a series of boxes, depending on the size or number of stories. For example, a single-story modular home could consist of two boxes, while a two-story home could have four boxes.

They are transported to the site where a trained team from the factory assembles the boxes and installs the finish materials, like carpeting. Most modular home factories build homes to the customers' specifications, allowing upgrades and options.

Modular homes are built in factories but are assembled on-site.
Modular homes are built in factories but are assembled on-site. (Image: Daniel Mirer Photographer/iStock/Getty Images)

What Are the Advantages of Manufactured Homes

The major advantage of manufactured homes is their price. They are the least-expensive single-family home available. Since they are built from start to finish in a factory, few materials are wasted, unlike site-built homes.

Manufactured homes are instantly livable, as well. They are a good alternative for people whose site-built homes have been rendered unlivable and they wait out the reconstruction process on site in a home that can be easily removed from their lot when their home is ready for occupancy.

Manufactured homes are instantly livable, as well.
Manufactured homes are instantly livable, as well. (Image: uptonpark/iStock/Getty Images)

What Are the Advantages of Modular Homes

Modular homes are built indoors, away from wind, rain and snow, and can cost less than site-built homes because they are built efficiently. As with manufactured homes, the factories have less waste, which cuts down on construction costs. Homes built out of the elements are not exposed to water, which is one of the hardest elements on construction materials, exposing them to warping or even mold or mildew damage.

Insurance and Financing Manufacturing and Modular Homes

Modular homes are legally considered site-built homes, which has important considerations for financing. Lenders and insurers look at manufactured homes much differently. It is possible to get a 30-year loan for a manufactured home, although the interest rate is likely to be higher because historically, the default rate for loans associated with manufactured homes is higher than site-built homes.

The insurance industry also treats the homes differently. Manufactured homes are more likely to suffer wind damage, because some jurisdictions do not require that they be permanently affixed to a foundation or use tie-downs.

The insurance industry treats the homes differently.
The insurance industry treats the homes differently. (Image: George Doyle/Stockbyte/Getty Images)
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