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What makes a Modular home expensive?
Modular homes are more expensive in general
because they are built to your state building codes. These codes
are stricter and more demanding, giving you a better home than the goverment
regulated Sectional homes. These homes are competing
with site built homes. Everything in the Modular
home should be equivelant to that of a new regular home.
What makes a home more expensive
1. You really need to do your homework on this. Make a
very long list of standard options and try to figure out how much each
item is worth to you.
2. Every manufacturer is going to be different, some
manufacturers will include quality options, while other will include the
cheapest material they can find.
3 . Customization
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What makes a Modular Home Cheap?
Since the Modular home must meet state code requirements
it can't be too cheap. But, there are a few things to consider...
These are only my opinions but I think they hit close to home.
Be careful when purchasing a modular home from a manufacturer
that also makes Sectional homes and Mobile homes. I feel that a
bit of the philosophy of making sectional and mobile homes accidently
slip into their Modular home designs, somehow resulting in less than
quality Modular homes. This is purely a subjective and narrow opinion
that I'm sure many would argue against.
What makes a Modular Home cheap...
1. Very inexpensive fixtures and accessories. These products
will probably break or wear out on you within a couple of years.
Thin carpets, plastic faucets, thin plastic sinks and bathtubs, metal
windows, cheap outer doors, thin wallboards, wrapped trim, cheap wall
studs, bare minimum structural requirements, cheap siding, cheap cupboards.
You get it right?
2. Not being able to customize anything doesn't make
a home cheap but it does make the home less expensive.
3. Just a few options. This makes a home less expensive.
4. Poor attention to detail. Slapped and glue together.
(Just kidding)
5. Bad warranties.
6. Locally made doesn't make a home cheap, but it may
make it less expensive.
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How do I find the best price
on a Modular Home?
There are many Modular home shops out there that feel their
homes are the exact same thing as site built homes. So, they will
sell you on that idea and charge you just as much as a site builder will
charge you.
Structurally, they are correct but, there are a couple of
problems with that train of thought. First, the Modular home is
a more efficient way of building homes and in fact, cost the builder less
to purchase. The second is that it takes less effort and time/money
to set the home up on the site and finish it off. So, instead of
passing the savings on to you, they put it in their pockets.
Stay away from these shops and you'll save money.
Also, be wary of the retailer that sells both sectional,
mobile and Modular homes. See Tricks and Scams.
This is a simplied way to shop.
1. Find out how much you
can afford or want to afford.
2. The home is only one little part of all the costs
of this project, so go out and do your own homework on all the other costs
that will occur. To get this list ask your banker, they probably have
a sheet that has everything you'll need to pay for.
3. Once you have the construction costs nailed down you
can start looking for homes. I'm serious don't go look for homes
until you know what going on. I know you won't follow this advice.
If you do this though, you'll know more than most of the sales people
you'll meet. I know, Scary..
4. Get a general idea of how many square feet your budget
will allow for. If you give the salesperson a 50,000 dollar budget, they'll
show you what they have in your price range.
5. Once you have the square feet down, find a floor plan
that you like. I would get every floorplan in your square footage that
is sold in your state or area.(many retailers will build from hundreds
of miles away.)
6. Once you have a floorplan down, lock it down to a
manufacturer. They all have very simular plans. You don't want to shop
different manufacturers because you won't know if you're getting the best
price or not. If only one retailer sells the plan you like then you risk
not getting the best price for the home you want. You might get
a cheaper price from one retailer on a different floor plan, but
since it's not the same home there isn't any way to tell if it's a good
deal or not. In the end it's obviously your choice.
7. Once you have one floor plan from one manufacturer,
go find every retailer that sells that home in your state. Most manufactures
web sites will give you a nice list of all the retailers that sell their
homes.
8. Pick one retailer and spend a ton of time with
them picking options and nailing down costs. Always write down what they
tell you or have your own list ready and fill in the information so you
can give the list to other dealers.
9. Never ever ever never put down any money until you
are done shopping. Not for anything. Don't do it. It will take you for-----------ev-------------er
to get that money back to put down on the other dealer. I know it's the
law, 24 hours and they have to give it back. Don't do it. It won't happen.
If it does, you got lucky. Don't do it. Get it?
10. If you feel that everything you want in your
home is all laid out and every cost is covered it's time to go out and
shop for your bottom dollar. I'm talking about the price of the home,
options, and retailer costs like delivery, set up, and whatever else they'll
try and charge you for.
11. Take a copy of your list of costs and with a huge
smile on your face, hand it to the salesman and ask him if he can beat
it. Of course, he won't like the situation. He doesn't want to do the
work of coming up with a better price and have you walk away to the next
dealer (which you'll do) so he'll try and pressure you into some sort
of deal. Just get the new price, in writing, so you can take it to the
next guy. His list of costs should match your list of costs perfectly.
Don't let him leave anything out that he may charge you for later.
12. By the time you're done you should
have the best price possible.
13. When buying a Modular home try and
separate General contracting costs from the cost of the home. General
contractors are definately going to bump up every bid to make money off
you in every area they can. It's not a bad thing, but it's nice
to know what they are charging for their services and what they are charging
for their home.
Tip... If there is a time when construction
stops in your area, like winter, this would be the best time to buy. Sales
people get hungry at this time and are willing to part with their profit
faster.
Warning...Getting the best deal, like paying almost no
profit, is a good and bad thing. Be prepared when your sales person
doesn't want to spend a bunch of time and effort on your project.
You took away all their money and motivation because now they are working
for next to nothing. You really need to stay on top of things to
make sure everything gets done.
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What do I need to stay away
from with Modular Homes?
Every manufacturer has it's good and bad aspects.
The only thing that I would advise is to be careful when
purchasing a modular home from a manufacturer that also makes Sectional
homes and Mobile homes. I feel that a bit of the philosophy of making
sectional and mobile homes accidently slips into their Modular home designs, somehow
resulting in less than quality Modular homes. This is purely a subjective
and narrow opinion that I'm sure many would argue against.
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Can I put a Modular home on
a basement?
You have to put a Modular home on some kind of
crawl space or basement.
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Should I buy a
Modular Home lot model?
Only if it fits in with my shopping
model.
Can you save money?
You might. Sometimes dealers are willing to lose money in
order to get rid of the lot model so they don't have to make payments on
it to the bank.
What could happen?
You could pay full price for a used home. Then you pay for extra
stuff liking paying for the first setup, then you get to pay for it
to be torn down, then you get to pay for it to be moved, and finally pay
to set it up again on your lot. Not a pretty idea. It happens.
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Construction tips for
Sectional Homes...
Don't be fooled. The home may be pre-built but
this is a new home construction project in every other way. Which means
that all the headaches of new home construction will happen to you to.
You need to decide if you want an experienced general contractor to make
sure everything happens. If you do, you're going to pay good money for
that service. Many times you could be dealing a person like
me, who when I started, didn't know a thing about the construction process.
Cover your butt...
1. If you can buy from a salesperson who has at least 1 year
of experience but preferrably 3-5 years of experience. This is because
instead of being the general contractor most retailers will expedite the
construction process for you. Meaning you are the general contractor and
legally liable for whatever they do and you can't sue them when or if
they don't do it correctly.
2. Get your own bids. I promise you that you'll shop
contractors better than they will.
3. Get contractors, if you can, that have experience
with Manufactured homes.
4. Create a realistic time line that will need to
be followed. Buying permits early is a good idea. A late permit
can really screw up a time line. Some permits take months to get.
This way you'll know when your salesperson has dropped the ball.
5. Rolling a home on a foundation is way cheaper than
using a crane. Hundreds if not thousands cheaper.
6. A full basement is not that much more expensive than
a crawl space.
7. A basement needs to be braced on the inside about
every 8 -10 feet so when the excavator backfills it doesn't cave in. If
it does you pay for it, no one else will.
8. The basement guy usually doesn't do any of the code
requirements most state have, like tar and insulation barriers.
They also don't provide the sill plate, you have to pay for that too.
9. Your warranty might require your retailer to
set up your home but if it doesn't you can probably find other companies
that will do it for less.
10. Last but not least, learn the new construction process,
it could save you thousands of dollars in errors and time.
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Service tips for Sectional
Homes...
This is one of the most frustrating areas of
any new home purchase. There isn't much you can do to ensure good
service. For some customers service is great for others it can be
a nightmare.
Service tips...
1. Call the state and see what kind of complaints are against
a retailer. Almost all retailers have complaints so don't panic
if the retailer you have chosen has some. What you are looking for
are numerous (too many) unresolved service issues. You can also
call past customers, but they will probably only give you customers that
are happy.
2. When your home has just been finished and you feel
the retailer still needs to go back and fix something, many times the
retailer feels differently than you. Are you surprised? One way
to solve this problem is to have your friendly loan officer and lawyer
draw up your sales contract stating that you won't pay the retailer the
last 10% until you are satisfied they have finished the job. They
hate it, it's great. The reason your loan office will help you is that
they don't want to have a loan on an unfinished home. Try and get everything
done right away so you don't have to fight them to come back.
3. Be aware of non existant service crews. At times
the store I worked out of didn't even have a service crew. Our toter driver
would go out and try and fix whatever he could when he had the time.
Not too cool. So, find out how many people are in their service
department, obviously the more people the better. If the store has a bunch
of independant contractors doing their work that's good too.
4. Having the manufacturer come out to your home is ok.
The manufacturer can be a bit slower than the retailer.
5.Don't give up when they don't come out. The person
that calls the most and screams the loudest gets the quickest service.
Being rude isn't good either... if you tick them off too much kiss them
goodbye.
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What is PAC on a Modular Home?
Most of you probably know what PAC is. It's the profit that
almost never comes out of the deal. Salespeople get paid on whatever money
they can get above and beyond PAC. PAC pays for the overhead and typically
doesn't make the retailer too much money.
PAC...
1. A sales person can't drop the price below PAC. Typically,
the manager can't either, PAC is set by the owner of the company.
2. Large retailers typically have higher
PAC's than smaller retailers because their overhead is larger.
3. Narrowing your shopping down to
one home helps you find who has the lowest PAC and least amount of
profit for them.
4. I've heard of PAC's ranging from $500.00
to $6,000.00
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Are they really throwing
it in for free?
No. Unless they've offered everything they are
willing to offer and you are down to your last retailers and going back
and forth between offers.
By the way, it's not free unless you didn't pay for it. The only way
your not paying for it is if there isn't any profit in the deal, which I
doubt will ever happen. So don't think of it as free just one more thing
you're paying for at the same price.
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Are Modular Home sales
really saving me money?
No. Run away from Sales.
Unless you are at the end of your search and it fits in my shopping
model.
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Do I need to put
a Modular home on a foundation?
Yes.
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Is buying a used Modular
home a good idea?
A used Modular home is real estate. Real Estate
is always a good idea.
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Are there options I should buy
when ordering a new Modular Home?
Most Modular homes come with everything you need, where sectional
homes leave out many important options.
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Do Modular Homes have a
good resale value?
Modular homes are gaining ground quickly.
Most people see them as a normal well built home, which they are.
Your home should apprectiate at the same rate as a site built home.
This is by no means a guarantee of any sort. Real Estate value goes up
down for many reasons.
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Are some Modular Home brands better
than others?
Read why some Modular
Homes are more expensive.
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What is a good deal on a Modular
Home?
A good deal is more than price. Here is my idea
of a perfect situation.
Good deal...
1. Very knowledgable salesperson that knows the new construction
process like the back of his/her hand.
2. Buy the home 2,000.00 - 3,000.00 above
invoice. I don't know about good general contracting prices since
I performed this service for free.
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Do Modular homes fall
apart?
A Modular homes is the same as any home. In fact,
your Modular home is probably stronger than a site built home. But, all
homes require maintenance so if you're prepared you won't be so upset.
Some things I have seen...
1. Siding fading at different rates.
2. Floor joists bowed up or broken.
3. Cupboards falling off the walls.
4. Home needs re-leveling.
5. Skylights leaking.
6. Shingles falling off.
7. Carpets wear out in one year.
8. Bowed wall studs.
9. Windows don't close correctly.
10. Trim falls off.
11. Doors don't close
correctly.
These things also happen to site built homes so don't panic.
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Financing tips for Modular
Homes...
If at all possible don't take the financing through
the Retailer you purchase the home. By financing your home through
a local bank you will have more control when it comes time to get the
last problems with your home finished.
Lenders that work directly with the Retailer may not give
you the rights you deserve.
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How much are they making off
me when I buy a Modular Home?
If you're not careful, I have seen profits of
18 - 20,000 dollars. Those kinds of rip offs are common. A
typical profit is around 10 - 13,000 dollars. A good deal for you
is around 2 - 3,000 dollars. Less than that is awesome.
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What is the invoice of a Modular
home?
The invoices for sectional homes change so quickly even the
salespeople can't keep up with them. I have seen invoices as low
as 25,000 on a 1000 sq ft home and as high as 90,000 on the more expensive
larger models. I'm sure they go higher than that.
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Should I buy a Modular Home
from a big or a small retailer?
There a benfits of both. A big retailer can buy the homes
for less, so if you shop right, you might be able to get the home for a
better price than the smaller retailer. Big retailers typically don't
or can't take care of their customers like the small retailers can. Smaller
retailer can have smaller PAC's and save you money that
way. Sometimes service can be excellent at some smaller retailers, where
customers are really valued.
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Modular Home
Tricks and Scams...
Many salespeople try a bit too hard to make the
sale. They will do anything to get you to buy. These are smooth
people and you'll never know what hit you. Everything will seem great
and you'll even be happy about your decisions. You may never
even know you were taken in by their lies. Some people don't
care and if that's you, most of my information should get you half
way. But, these people can make you pay more than you should, sometimes
it's just a few hundred dollars, other times it a few thousand and for the
unfortunate ones it can add up to 15,000 - 20,000 dollars. more....
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