Going it alone: Cloned homes a worthy option

For all they deliver in appearance, economy and efficiency, manufactured homes continue to be stuck with an image problem.

The rap is something Canadian. Spoken of as “pre-fabs”, these technically-advanced clones of conventional homes and their less-expensive cousins-“mobile homes without wheels”–appeal to many as unimaginative. But logic and foreign trends point to factory-built dwellings, particularly “modular homes”, where every wall, floor, ceiling and roof component of what essentially is a conventional dwelling, is made indoors and then assembled on-site–as the wave of the future. From 30 per cent in 1975, the share of all new United States homes that came out of factories had risen by 1992 to 50 per cent. In Japan, the increase was from one per cent to 20 per cent and in Sweden, from 30 per cent to 90 per cent.

That hasn’t been the case in Canada, so far. Here, production of both mobile and modular homes has remained almost static– seven per cent of total housing starts in 1988 and six per cent in 1997-a not-bad performance, given that conventional housing starts declined 43 per cent over the same period. And with much of Canada’s aging population looking forew lifestyles, it doesn’t take much to predict that better times still lie ahead for domestic home manufacturers.

^Not only are today’s full-sized modular homes as technically advanced as any on-site-built house, most are as attractive as anything on the market. And they offer speedier move-in times. Typically, a custom model, with all plumbing, oil, gas or electric heating in place, can be occupied on a lot of the buyer’s choice within 12 weeks, compared with four months for a site-built dwelling.

Another big asset is that the manufacturer can assemble the house almost anywhere-a big plus where experienced construction labour may be hard to find. In 1997, 5,102 more Canadian households moved into a fixed mobile or factory-built home–about 3,377 fewer than in the industry’s recent boom year of 1989 but also many more than went that route in 1995. One reason is lower mortgage rates but also, as Doug Penson, vice-president of sales for Royal Homes Ltd., a major pre-fab builder in Wingham, Ont., suggests, because seniors and baby-boomers alike are starting to learn the advantages of manufactured dwellings and mobiles.

Penson, whose firm sells only within Ontario but is typical of others across Canada, notes that seniors, in particular, are being attracted by the hassle-free aspect of dealing through manufactured-home builders. And Robin Morrison, a Newmarket, Ont., architect who specializes in cottage-country projects, agrees.

“Someone wanting a new home on a specific piece of land would normally have to ferret out and deal with an architect, an engineer and a builder,” Morrison notes. “By dealing with a manufactured-home firm, all this comes built into the price of the home. Companies such as Royal negotiate a custom design with the owner, arrange to have the foundation built, transport the components anywhere in the province and assemble the home with their own labour-in effect, delivering a turnkey product to the purchaser. All the owner has to provide is the lot, the financing and a lawyer as well as purchasing appliances for the home and hooking it up to local water, sewer and power sources.”

Royal Homes, one of Canada’s largest pre-fab manufacturers, currently offers 60 conventional homes ranging in price from $104,000 for a five-room, 1,214 square-foot bungalow to a $378,000 for a two-storey, 11-room model replete with a conservatory. It also offers a small array of wheel-less mobiles that come in 504-square-foot modules measuring 42 feet by 12 feet and worth about $50,000, or units twice that size priced at between $85,000 to $90,000.

Penson concedes that the industry has been hurt by its image problem. Also by a few of its own making such as poor marketing-“maybe Canadians can’t break that old habit of building everything outside”, he says. The industry also suffers from few economies of scale and inadequate capital and financing, together with discriminatory zoning practices for fixed mobile homes built for a trailer park or so-called “granny flats” designed to accommodate an older couple on their children’s home lot.

But its products, he says, also come at about 5 per cent less than units built on-site. (One reason, he argues, is that building inside a factory reduces the down time that normally hits builders having to cope with bad weather. Another is that factories allow for the use of more efficient machinery.)

“On top of that,” Penson says, factory-built homes not only command premium re-sale prices, lenders know them and will loan readily on them.”

Penson considers Royal’s most-popular model today to be its seven-room, 1,815 square-foot, Aberfoyle, a brick veneer home with three bedrooms that costs $142,600 plus tax. But to get a better handle on over-all cost, he suggests adding $40,000 for a small-town Ontario lot measuring 80 feet by 130 feet, $3,000 for four or five new appliances, $2,000 to connect the home to local water, sewer and power services, plus spending perhaps $875 a year for heat and hot water and more again for lighting and other electrical power needs.

It may seem to be a contradiction that the strength of the business-factory uniformity-is also its biggest weakness. How, for example, can someone design a structure that is relatively uniform and still have the special qualities that most people look for in their own home?

One major answer is that today’s manufacturers have learned a lot of design tricks and now have one of the most powerful design tools they’ve ever had-the personal computer. Computer-aided Design (CAD) has enabled manufacturers to offer buyers almost anything they want. Today, the buyer can sit at a computer with the manufacturer and see full-colour renderings of all types of homes. These renderings can then be turned, changed and enhanced with just a few keystrokes.

This sort of process is now becoming common among many manufacturers. And there are other good reasons to consider factory-built housing, not the least of which is being able to wed a home of the owner’s choice to a piece of land tailor-made to his or her lifestyle.

But one word of caution: it makes little difference if you paid $100,000 or $1 million for a house if it starts to fall apart before the ink is dry on the mortgage. Clearly, it makes sense to look for some warranties on the work you are paying for. One way to ensure a satisfactory job is to hold back a portion of the final payment to the manufacturer. If this isn’t possible, schedule a walkthrough with him about a month or two after moving in. Point out any defects in workmanship and materials you consider sub-standard. Then follow up with a letter outlining the same to all concerned parties. This will serve as useful documentation if you ever need to resolve any problems in court.