Like HowStuffWorks on Facebook!

Are prefab homes killing the construction industry?


Prefab vs. Conventional: How They Stack Up
Prefab homes are usually constructed on site, but some, like this home from 1970, are entirely prebuilt and moved from the factory to their potentially permanent residence by truck (or, in this case, Sikorsky Skycrane).
Prefab homes are usually constructed on site, but some, like this home from 1970, are entirely prebuilt and moved from the factory to their potentially permanent residence by truck (or, in this case, Sikorsky Skycrane).
Alan Band/Keystone/Hulton Archive/Getty Images

If you've ever flipped longingly through the real estate section of the newspaper, you know how enticing the notion of building your own custom dream home can be. In the U.S., where that's often woven into the larger American dream, it's a difficult prospect to turn down.

But custom homes have their downfalls. Between architects, contractors and workers, they've got lots of moving parts; because construction takes place outdoors on the site of the home, all those teams are at the mercy of the elements, and construction can be held up for months by bad weather. Additionally, many areas, particularly large cities, have stringent zoning requirements, and would-be homeowners may find themselves struggling with mountainsof unanticipated fees and red tape.

Prefab homes address many of these issues. For one, they offer significant savings: At around $150 to $200 per square foot (or per 0.09 square meters) as of early 2012, prefab homes could run 45 to 50 percent cheaper than traditional homes, which could cost around $300 per square foot [source: Connors, McKeon]. Since they're factory-built, construction can take place any time, rain or shine -- which also means more efficient production and quicker turnaround times. And where prefab homes may have been lacking aesthetically in their first few years of existence, many modern companies are designing their products to be customizable, luxurious and environmentally friendly [source: Sylvester].

But prefab homes have their drawbacks as well. They're designed to align with local building codes, which makes it difficult for companies to do business outside a very limited area. This also becomes a challenge when they age: Repairs and maintenance require materials designed and sized specifically for your home, which you won't find at your local hardware store.

Lower cost is one of the major draws of prefab construction, and while it's true that the homes themselves are less expensive than custom projects, prefab home buyers can face hefty fees for assembly permits and large equipment rental. Additionally, when your home is built in a factory miles away, shipping charges -- anywhere from $5,000 to $30,000 -- apply as well [source: Vanderbilt]. And as much as we might like them to be, prefab homes are not DIY projects: They require heavy equipment and professional workers to piece them together [source: Sylvester].

Ultimately, though, despite the leaps that the industry has made, prefab homes still carry a stigma: Many contractors and consumers consider these factory-made homes beneath them [source: Hackney]. On the next page, we'll explore the statistics behind the stigma.