If you're shopping for an affordable home, you've likely come across both modular homes and manufactured homes. While they may sound similar and are often grouped together, they are very different in terms of construction, value, financing, and zoning. Understanding the differences can help you make a smarter buying decision and avoid common mistakes.
What is a Modular Home?
A modular home is built in sections, or modules, in a factory. These modules are then transported to a permanent site and assembled on a traditional foundation, just like a site-built home. Modular homes must meet all local, state, and regional building codes, which are the same standards required for homes built entirely on-site.
Key characteristics include:
• Built to the same building codes as site-built homes
• Placed on a permanent foundation
• Eligible for traditional mortgage financing
• Typically appreciates in value like a traditional home
• Can be customized in layout and design
Because of their high construction standards, modular homes often look and perform just like conventional homes. In many cases, they are indistinguishable once completed.
What is a Manufactured Home?
Manufactured homes, sometimes called mobile homes, are built entirely in a factory and transported to a home site in one or more sections. These homes are built to the HUD Code, which is a federal building standard and different from local building codes.
Key characteristics include:
• Built to HUD Code rather than local codes
• May not be placed on a permanent foundation
• Often restricted in certain neighborhoods or municipalities
• May depreciate in value depending on the market
• Financing may require specialized lenders
While manufactured homes can offer affordability, they are often treated differently by lenders, appraisers, and local governments. These differences can affect your financing options, resale potential, and even where you are allowed to place the home.
Visual and Structural Differences
Modular homes are typically built to resemble traditional homes with pitched roofs, garages, full basements, and even multiple stories. Manufactured homes tend to have a more rectangular shape, often with skirting around the base and fewer exterior upgrades.
Modern manufactured homes have improved in appearance and quality, but modular homes remain the preferred option for buyers seeking long-term value and curb appeal in established neighborhoods.
Financing and Investment Considerations
One of the biggest distinctions between these two options is how they are financed. Modular homes qualify for conventional, FHA, and VA loans just like stick-built homes. Manufactured homes often require different types of financing, especially if the buyer does not own the land.
Modular homes also tend to appreciate over time, especially in strong housing markets. Manufactured homes are more likely to depreciate, although this depends on condition, land ownership, and location.
Which One is Right for You
If you are looking for a long-term home that builds equity, offers design flexibility, and qualifies for standard financing, a modular home may be the best fit. If your top priority is affordability and you are okay with limitations on placement and resale, a manufactured home might be suitable.
Ultimately, the best choice depends on your goals, location, and financing preferences.
Amo Realty's modular home map search helps you find modular homes that fit your lifestyle and budget. You can also sign up for alerts to be notified when new listings become available.