Thirteen years ago, Anthony Zarrilli read an article about modular construction. At the time, his family’s company, Zarrilli Homes, in Brick Township, N.J., was strictly a stick-built outfit. But he was intrigued enough to contact all 21 modular manufacturers that were delivering to his market.
He heard back from six, and eventually went with Westchester Modular in Wingdale, N.Y., which supplied the modules for Zarrilli’s first modular home, which he built on spec. He delivered his second modular spec in a snowstorm and was amazed at how tight the building was. And from that moment on, he hasn’t looked back. Modular construction accounted for 90 percent of the three dozen homes Zarrilli Homes completed in 2011.
At first, he had to convince his older clients that modular was different from a manufactured house. But over the past several years, he’s received little resistance to modular, probably because he’s been able to show customers they would be paying less for a better-built house.
"It depends on the layout and the plan, but I can bring in a modular house for 10 percent to 12 percent less than a stick-built house," he says, if the comparison includes advanced framing, truss roofs, and higher insulation R values. In fact, he’s found that the larger the house, the greater the savings: Last fall he was working on a 10,200-square-foot modular home in Red Bank, N.J., that will cost between $1.25 million and $1.75 million. "I know the customer priced it out with stick builders, and it would have cost $2 million." He builds the occasional stick-framed house, but only because some customers are more comfortable with it or because some municipalities still won’t allow modular in their communities.
Pepperwood Signature Homes completes between six and 12 semi-custom and custom homes each year, ranging from 2,000 to 6,000 square feet, on its customers’ lots. As the market has gotten smaller, Chris Tsonton says his company has had to "refine our game plan and how we compete," which has meant building more homes using systems-built construction. He’s also tried modular construction and likes that he can deliver a house at a lower price than a comparable stick-built home. "That’s the beauty of it."
However, he doesn’t get much demand for modular homes, nor do many of his competitors. Tsonton, president of his local HBA, says, "Some of the nationals have dabbled in it, but none of our real active members are doing it."
Why? Because modular, according to Tsonton, doesn’t give customers the leeway they often want to make changes to their house plans late in the construction process, which is why they hired a custom builder in the first place.
Tsonton says that a modular’s wall and floor plans "are pretty much laid out," and therefore aren’t accommodating enough for clients who may want to move windows and doors around. "It would be very complicated, [whereas] with stick-built houses, you’d just pull apart the framing and do it over."
He concedes that some modular manufacturers would argue that their house plans are customizable. "But based on my experience, flexibility at the 11th hour is the issue."
Learn more about markets featured in this article: Cleveland, OH.