Lower Home Prices, Part 2

• John Vandivier

I recently wrote about <a href="http://www.afterecon.com/economics-and-finance/lower-house-prices/">6 ways to lower home price, but not all prices compared apples to apples because some options were turnkey, or move-in ready, while <a href="http://modularhomeowners.com/modular-homes-under-100000/">others weren't. This article looks at move-in ready prices and finds that modular homes may present the best value.

Turnkey or move-in ready living options include water and electrical. Low priced home additions do not require water. 3D printed concrete structures have no included water or electrical, and neither do some prebuilt metal structures. The highest cost per square foot areas of the home include bathrooms and the kitchen.

<a href="https://www.treehugger.com/modular-design/not-shipping-container-house-it-something-far-more-significant.html">Modular homes do address these issues, but standard modular homes scale only somewhat efficiently. A 1-bedroom 1-bath modular home will include a kitchen, so buying multiple modular homes of this kind result in unnecessary duplicate kitchens. It turns out, some modular builders have gotten very smart about this and will even sell 1-off bathroom modules. Additions are cheaper than modular homes, so we can patchwork an arbitrarily sized house using a combination of:

  1. A seed home, which includes a kitchen
  2. Bathroom modules
  3. Additions
We can now compare 3 home buying options:
  1. Traditional
  2. Simple modular
  3. Patchwork modular
The second option refers to the fact that most modular producers have their own floor plans available in various sizes, instead of a buyer and a contracting patch-working modules, potentially even across companies. A common unit of modular structure is the shipping container. These containers range in size from 20x8x8 to 40x9x9.

Some specific, modern, high-quality module producers:

  1. Nova Deko
    1. The Milan, 320 sqft, $28k*
    2. The Manhattan, 440 sqft, $32k*
    3. Bathroom pods and bulk purchase discounts.
    4. NovaPods are stackable.
  2. Montainer
    1. Single container builds from $45k and multi-container builds from $85k.
  3. Honomobo
    1. A range of high-quality builds with prices not listed. Previous media articles peg their prices as competitive with Montainer.
  4. Meka
    1. The Sol, 480 sqft, $101k
  5. Backcountry Containers
    1. Single Container builds from $40k and multi-container builds from $100k.
*May not include foundation and installation, so add $10k to make it even with others.

Recall that the <a href="https://www.homeadvisor.com/cost/additions-and-remodels/build-an-addition/">cost of an addition starts around $20k and averages around $40k. Bathroom additions should be <a href="https://www.homeadvisor.com/cost/bathrooms/">budgeted with at least $25k.

Consider these possibilities for a 2 bedroom, 2-bath unit:

  1. 2 Manhattans or a Montainer or a Honomobo, all roughly 800 sqft and $85k.
  2. Manhattan, bedroom addition, bathroom addition. Also seems to come out at about 800 sqft and $85k.
  3. Traditional home purchase. I couldn't find a 2/2 in Austin for under $150k. But, they were closer to 900 sqft.
    1. It looks like you could get a 4/4 for this price following the modular container plan.
You can also find a previously owned 5/3 or a home around 3500 sqft in Austin for $500,000, but this still seems to be a loss compared to the modular route.

I didn't call it out above because it looks to good to be true, but the prices for <a href="https://www.alibaba.com/showroom/unit-bathroom-pod.html">bathroom pods and <a href="https://www.alibaba.com/trade/search?fsb=y&IndexArea=product_en&CatId=&SearchText=prefab+house">prefab homes on Alibaba is blowing my mind. Some of that stuff seems low quality or non-permittable though.