Last year, factory-produced modular homes, excluding mobile homes, accounted for 2% of all of the single- and multifamily houses built in America, according to estimates released earlier this month by the NAHB Research Center.
In fact, over the past seven years, modular has risen above 3% of the total only once, at 3.6% in 2009 (see chart below). In markets where tract building dominates or where labor is cheap, modular "doesn't make sense for a lot of builders," observes Dan Goodin, vice president of sales and marketing for Nationwide Homes, which has been producing modular homes in Martinsville, Va., for 52 years.
Still, Goodin remains convinced that housing trends and buyer demand are shifting toward a greater acceptance of modular, particularly for rural scattered lots (where it would otherwise be expensive to send subcontractors over long stretches to complete a stick-built house) and urban infill, where the speed at which factory-built homes can be assembled at jobsites is less disruptive to the surrounding neighborhood.
Nationwide, which works with a network of more than 200 builders in 15 states and the District of Columbia, is a recent addition to Cavco Industries' stable of companies that includes Fleetwood Homes and Palm Harbor Homes. Nationwide recently began construction on its 35,000th house, a 1,650-square-foot three-bedroom Colonial whose buyers, Kristen and David Welsh, wanted to live next door to Kristen's parents in Axton, Va., on land she bought from her grandfather. That house will be ready for move-in next month.
Right now, only one of Nationwide's three production lines is active, but Goodin says the company expects to rev up a second line soon to meet anticipated demand. "As we look to the future, we believe demographics are on our side," he says. While Nationwide, in the past, has built modules for homes as large as 5,000 square feet, its production today focuses more on smaller homes that are more in line with what buyers are looking for, says Goodin.
Its most popular house plans range from 1,500 to 1,800 square feet, with finished selling costs (excluding land) between the high-$60s per square foot to $120. However, its ECO Cottages series, which Nationwide launched last year, offers living spaces from 250 to 513 square feet, which can be used for everything from a home office and sleeping quarters to a beach house. Its Care Cottage series targets seniors looking for home healthcare solutions.
The company recently introduced an urban infill series called Renew Avenue, with homes ranging from 1,529 to 2,679 square feet. Nationwide also has a strategic alliance with the architectural firm Allison Ramsey, which offers a broad new-urbanist flavored series of homes, cottages, clubs, and cabins through the manufacturer.
John Caulfield is senior editor for Builder magazine
Modular, light-frame homes as a percentage of total home production
2010 0.8 1.2
2009 2.8 0.8
2008 1.6 0.3
2007 1.6 0.7
2006 0.9 0.7
2005 1.9 0.4
2004 2.4 0.3
Source: Anunal Builder Practices Survey, NAHB Research Center
Learn more about markets featured in this article: Washington, DC.