3 Problems with Modular Homes

Updated: Nov 12, 2019


3 Problems with Modular Homes Firstly, what is a modular home? Well, put simply, modular is just a building methodology.

Instead of building a home on-site which is a traditional building… modular building just means to build the house off-site and then deliver the completed modules (components of the house) to the site and finish off the installation.

Typically, traditional builders use timber or brick as a structural material, we build out of light-frame steel.

Just as a side note - Timber is slowly becoming unsustainable… the majority of houses use timber frame but there’s just not enough to keep up… and we’re seeing a change in the industry to man-made materials.

Anyway, let’s discuss 3 problems with modular homes!

1) Design.

Although you can build any sized home or to any specification using a modular building system It is… Slightly more restrictive unless you pay for additional customization.

What I’m particularly referencing here is ceiling height. The standard height is 2.7m internal ceiling height which is pretty high… but if you want 3m or 3.2m this will add to cost as we need to build the extra walls on top and this will roughly add $5000-$10,000 to the costs.

2) New industry for top-tier lenders (big 4).

Make sure to check with your bank what finance you can get for modular construction. Some are now becoming open to it and won’t make your life hard. Others are still stuck in a traditional lending mindset and will only give you a cash release based on the equity you have in assets such as land but that may not be enough in some cases.

Every modular company has its own payment schedule so make sure to check and have a chat about this before getting into it and then realizing oh wait…” we’re going to have some problems here and I’ve already spent all this money on designs and permits.”

3) Not cost-effective unless it’s at least 4x modules (120sqm).

On average the square metre rate will go from $3000-$2500 for 90sqm down to $2500-$2000, if you’re building even bigger than the rate goes lower. So modular becomes more cost-effective at scale, and thus for smaller jobs, it’s pricier.

-- Have a suggestion for the next video? Send through here - greg@dwelliehomes.com.au Enjoyed this video? Watch our Modular Building vs. Traditional Building Comparison

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