Prefab is Not the Answer to Affordable, Modern, and Green Homes

This article was authored by guest Chad Ludeman of Postgreen Homes. 

Prefab homes seem to be showing up more and more in the media these days, especially with two large exhibits in Philadelphia showcasing their history this year.  Like many, I hoped that prefab would be the answer to bringing modern architecture to the masses in the US and beyond.  I thought that finally, modern home design would be attainable by those of us who aren’t pulling in lofty six figure incomes. That was until I conducted extensive research into the possibility of starting a development company in Philadelphia using only prefab homes.

Don’t get me wrong, I love prefab and many of the firms out there with cutting edge designs in the prefab realm.  There are also a variety of building lessons that can be learned from the prefab methodology.  I just don’t believe it is the best way of delivering modern design to the average new home buyer.

Below we will look at this issue from two points of view.  First, we will look at the prefab industry and try to dispel some of the myths that have arisen around it.  Second, we will take a quick look at how the housing industry may be able to learn from both prefab and site-built homes to create a hybrid approach that will provide a better, more accessible solution to the home buyer and hopefully reduce the barrier of entry to modern, green, and unique residences.

Names and firms have intentionally been left out of this post in an effort to discuss only the facts, dispel some of the myths of prefab, and possibly look towards a better method for bringing modern homes to the average American.

Prefab’s Claims to Greatness

There are a variety of claims made by prefab proponents to support the idea that this method of home delivery is the best way to provide modern architecture to the masses.  Not every prefab supporter or manufacturer makes every one of these claims, but they are pervasive enough that we will address them as the claims of the industry as a whole.

They are:

  1. Prefab is more Affordable
  2. Prefab produces less Waste
  3. Prefab takes less Time
  4. Prefab is more “Green”

OK, let’s look at each of these “myths of prefab” one by one.

More Affordable. We are starting here because it is the easiest to disprove, and is also the main reason that many start looking into prefab.  Unfortunately, most find, after weeks of research, that they just cannot afford any modern prefab unit on the market today.  This just doesn’t seem fair.

The bottom line is that most modern prefabs today that someone interested in modern architecture would consider buying will cost at least $250 per square foot when all is said and done.  This includes everything but the land cost which can vary greatly based on the buyers location.  There are a few people out there that claim to get very close to $200 psf, but there are many more that will quickly go over $300 and even $400 psf. Stick built modern homes can be built to the same specs as these prefabs for less than these costs in all but the most expensive areas of the country.  For example, in my hometown of Philly (6th largest city in the US) where labor and material prices are far from cheap, most of the prefab homes I’ve seen could be stick-built for anywhere from $125 – $150 psf.

Prefab manufacturers and resellers will tell you that prefab is cheaper because of the time and labor savings, but let’s list the key factors that actually make prefab more expensive than site built:

  • Manufacturing Facility Overhead – Prefab manufacturers work in buildings with support staff above and beyond those actually building the houses. They also have facility costs such as equipment, utilities and maintenance … Site built homes, built by most residential builders, don’t have any of these.
  • Manufacturing Company Profit – These manufacturers are making at least as much profit as the average general contractor and often more.  The majority of cost savings resulting from the prefab manufacturing process stays in the pockets of the manufacturer.
  • Delivery, Setting, and Crane Fees – These can easily run $10K per house (cranes aren’t cheap) and can be significantly more if the distance from manufacturer to site is large.  Most manufacturers also dictate who the labor crew will be, and often they won’t be the best value available.
  • Architect or Reseller Fees – In some cases the fees charged by the architect providing the prefab can run as high as $30,000 or more.  Even in cases where no additional site customization or design work is needed, a substantial fee will still be added by the architect or reseller.

Less Waste. Since prefab is built in a factory they claim to create much less waste by setting aside their scrap and reusing it in other projects.  What they do not often advertise is that their structures use 20% – 30% more raw materials than stick-built homes in order to withstand transportation.  That’s no small figure in my book, especially considering that even if there is waste on-site with stick-built homes you can now easily hire a waste removal company that will recycle 90%+ of your construction waste.

There is something called “value engineering” which can be done effectively on site-built homes and the polar opposite called “over-engineering” that is often done with prefabs.  Guess which produces more waste and costs the client more money.

One last point on the waste topic.  Things like doors swing and cause damage during shipping so there is a lot of extra bracing in the house to prevent this damage.  On top of that, there are extra structural supports inside stairwells and such that are left in the home after delivery.  Loose materials to finish the homes are also left inside the boxes upon delivery.  I recently walked through a delivered prefab with the owner and he offered me pallets of free OSB because he had so much extra and had no idea what he was going to do with it.  I’m sure every prefab company is not this sloppy, but it is another indication of waste in an industry claiming extreme efficiency.

Less Time. Most prefab companies will claim that there are significant savings because the construction process is much faster than a traditionally built home. The site work can be done while the home is being built in the factory and the actual physical build time on the manufacturing floor is only a few short weeks.  However, in practice there may be months before that process, and months after, that greatly lengthen the time before the home is ready to be lived in.  If you scour a prefab company’s FAQ’s, call them or ask others that have gone through the process you will find that 6-12 months or more is not uncommon from start to finish.  With site-built homes often going up in 4-5 months where is the time savings in prefab?

More Green. We’ll throw this in here because “green” is hot now, so the prefab companies are jumping in and claiming superiority again in the green realm.  Much of the green claims in prefab come from the lower waste myth that was dispelled earlier.  The new one that we’ve been hearing more of lately is that the insulation is installed to better standards than site-built homes because of the superior labor and inspections put in place by the factories.

This seems like a weak claim for a number of reasons.  Most prefab companies are still using loose, batt insulation that is often falling out of the framing by the time the modules reach the site.  Batt insulation alone is not what is making the better green homes out there more energy efficient.  Also, in many cases, all of that house wrap that is supposed to be sealing up the home from the outside is tearing apart and falling off of the exterior by the time the modules reach their final resting spot.  Lastly, the extra framing we spoke about earlier is causing more thermal bridges in the building envelope. In other words, the more structural framing that connects to both the drywall inside and the exterior sheathing outside, the poorer the total insulation of the home. Wood is a very poor insulator.

A Possible Hybrid Prefab and Site-Built Approach

What if you were to take the best of both prefab and site-built methods of home building and combine them into a hybrid approach to construction and home delivery?

First, let’s start by roughly defining what this hybrid method might include:

  • Quality, stock plans from qualified architects that meet local codes and can quickly receive zoning and building permit approvals.
  • Educated clients that understand they are not buying a fully custom home.
  • Prefab building envelope – SIPs, ICF’s & Precast Walls.
  • Internal prefab components made in local shops — interior framing, framing with electrical & plumbing, prefab kitchen/bath/utility pods.
  • Better scheduling and local subcontractor cooperation

Quality Stock Plans
The first place to start when trying to streamline and cut costs from any building project is with high-quality building plans from qualified architects.  If every detail down to the last sheet of drywall and bucket of paint is nailed down and proven out in each set of plans, it becomes much easier for a GC to provide the best price from his crew and any subcontractors that are hired for the job.  This can not be undervalued, since any uncertainty on the part of those bidding on the project will instantly up the quotes.  This is where prefab gets most of the efficiency gains in their process, by building exactly the same home over and over.  They know exactly how much material and how much labor goes into each home plan in their library of options.

Another point to make here is the need for plans to be developed or easily modified for any location in order to ensure a fast permitting process. Zoning and building permit acquisition can add months to a building project, so having a way to expedite this phase of construction can be a significant cost saver that should not be overlooked.

An Understanding of Semi-Custom by the Client
One of the big reasons that fully custom homes designed by architects are expensive is not necessarily related to the architectural firm’s fee. It has more to do with the fact that the client is choosing exactly what they want in terms of appliances, layout, and finishes. There is nothing standard about this process.  The GCs that bid on these homes will be forced to deal with any number of materials or construction processes, some of which they might be seeing for the first time.  They may not be able to get their normal discounts on preferred brands and the uncertainty in labor costs will add a healthy premium to their bids.  An experienced GC knows that there will be many changes during construction on these custom homes due to the owner changing their mind or inadequate documentation on the building plans, and they will pad for these changes in their budget.

What clients must understand in any prefab or hybrid method is that the more custom changes they try to make, the higher their costs will be.  There is not an abundance of quality prefab or stock plan options out there, which is one of the reasons everyone ends up wanting to customize so much.  If the stock plan industry grew, then there would be much more variety to choose from and less desire to customize.  In the end though, clients will still need to understand the cost to value ratio of customization.  Most customizations will probably add $0.50 (if any) in value to the home for every $2.00 in extra cost that is incurred to make that customization.

Prefab Building Envelope
Now that we’ve covered the planning phases of a lower cost hybrid home, we can get into the nuts and bolts of the structure itself.  The basis of the hybrid system proposed here is that prefab is good in the right places and in the right doses.

The best example of this concept is SIPs or Structurally Insulated Panels.  SIPs are wall and roof panels that are prefabricated in a factory and then delivered on a flat bed truck to be assembled like legos on the construction site.  The SIPs combine the framing, insulation, and exterior sheething all into one product.  The windows and door openings of a home can also be cut exactly to size with framing lumber attached so that they are 100% ready for the windows and doors to be installed on site once they are in place.  The product is superior to traditional insulation methods in that it offers higher R-values per inch and an overall tighter home envelope.  There is far less thermal bridging with SIPs and dramatically less air leaking out of the finished house.

The SIPs will often save slightly on material costs when all components are added together, especially compared to a full prefab house that requires up to 30% more lumber to withstand shipping.  The SIPs are also flat-packed, usually on one truck, which reduces transportation costs compared to prefab which will require multiple truckloads of modules to the site.  SIPs can be handled by a fork lift or lull on site as well as by hand, which eliminates the very costly expense of a full-sized crane and operator at the site (always needed in prefab).  The panels will go up in 3-5 days on a typical home which beats stick building by a long shot considering that the SIPs include insulation and sheething.

Similar products to SIPs are precast concrete wall systems like Superior Walls that include insulation.  These walls can significantly reduce time in the foundation and basement portions of the build.  ICF’s or Insulating Concrete Forms is another alternative to SIPs or precast walls.  These are basically hollow blocks of Styrofoam insulation that can be linked together quickly and have concrete poured in the centers to form the finished structure.

Internal Prefabed Systems
The next suggested use of prefab in the hybrid model is not used very often in the US, but has been used extensively for years in other parts of the world.  Many good framers are able to prefab most interior walls, stairs, and even some floor decking off-site to speed up the installation process on-site.  This off-site framing can be done in a local workshop while the foundation is being set on a home and while the SIPs are being made in a nearby factory.

The next step in this concept would be to include electrical, plumbing, and gas line runs in these prefabbed walls to further reduce construction time on-site.  The building codes in the US make this very tricky, but the Swedes have been doing this for years with great success.

Lastly, the furthest development of this prefab interior component idea is to actually prefab entire kitchen, bath, laundry, closet, and utility assemblies at a local off-site location.  These small modules would not be subject to the strict structural requirements of larger prefab modules due to their size and the fact that they would not need to travel on highways.  They could be dropped right into the homes as the SIPs were going in place that could result in the vast majority of the home being assembled on site in only two weeks.  A good example of this type of system is the Copod designed and built by a company in the UK.

Advanced Scheduling and Building Team
Advanced scheduling and building is something that goes hand in hand with a good stock plan and a client that keeps customization to a minimum.  The successful tract home builders in the country that are building 80% of the new housing stock can teach us something about process (but certainly not architecture) in this step also.  They have their build schedules down to the day.

The way to reduce construction costs on site is to eliminate as many unnecessary delays in the schedule both with each subcontractor and in between each sub’s work on the site. This can be done by implementing the following:

  • A fully developed stock plan with no uncertainty for the GC
  • A qualified GC or Project Manager that can make and keep a good budget and schedule
  • A qualified GC or Project Manager that can reduce delays with local code officials and utility companies to a minimum
  • A team of quality subs with 1-2 backup subs in each field

This may sound like common sense to many, but in many custom and semi-custom homes, all of these factors rarely fall into place.  Many construction sites sit idle for weeks and even months as delays are experience with specific subs, in between subs or while waiting for local officials to inspect work that is completed.  These delays must be eliminated to reduce the on site build schedule from months to weeks on a hybrid house.

Advantages of a Hybrid Building Method

What are the potential advantages of this type of Hybrid method of building?

  1. Faster – A hybrid approach could easily reduce the total build time of a home from start to finish to eight weeks or less if properly executed.
  2. Less Waste – The use of SIPs to eliminate most framing waste, less transportation, no crane requirement and the use of a construction waste recycling company will result in less overall waste than than prefab or traditional stick built houses.
  3. LOCAL Labor – This is a big difference from prefab which uses remote labor to perform over 50% of the work.  There are SIPs manufacturers all over the country that make the same products and can enable 100% of the construction of a hybrid home to use local labor and contribute to the local economy.  In my book, this is a big advantage over prefab.
  4. More Energy Efficient – Better insulation, a tighter envelope and fewer thermal bridges from excessive framing equals a much more energy efficient home than any prefab on the market.
  5. Unlimited Designs from Unlimited Firms – Architects no longer need to develop a costly and time consuming relationship with prefab manufacturers or worry about marketing and selling their designs with the hybrid approach.  Many different plans from many different architects can be used in the hybrid system anywhere in the country.
  6. Cheaper, much Cheaper – Somehow I almost forgot this key point.  Bringing high quality residential architecture to “the masses” will be done by some type of hybrid building system like the one proposed here long before prefab will due to the significant savings in cost that will actually be passed on to the home buyer.

To Conclude . . . Finally

There are many amazing things being done in prefab, and if it weren’t for my self-imposed ban on mentioning specific companies and architects, I could name a bunch that I personally admire.  However, there are also a large number of misconceptions about the benefits of prefab that need to be discussed, and this post is simply trying to get that discussion started.  Are there points of dispute here?  Certainly. Am I perfectly correct in everything I have said?  Probably not. So, go to the comments and tell me what you think.

Editor Update 9/18/08: Tedd Benson of Bensonwood Homes has a lengthy, articulate response to this article, and Lloyd Alter of Treehugger mentioned a few points to consider as well.  Allyson Wendt of Building Green also added her thoughts on the future possibilities of affordable, green prefab.

Read more: green prefab | SIPs homes | container homes | tiny houses
Books: prefab architecture | the prefabricated home  | prefabulous + sustainable

  • Jake

    Thank you for making the point publicly! I bet it won’t be popular! The “idea” of prefab is so seductive- but trucking houses around is silly when you get to the bare bones, dirty hand part of really building houses.
    Houses make lousy cars and cars make lousy houses.

  • Mike M

    I applaud the writers at JG for posting this particular blog. They have shown a past love-affair with pre-fab housing, and it would be difficult to post something that goes against your own pre-dispositions. Well done.

    • Preston

      Thanks Mike M. We haven’t quite gotten over our love affair with prefab, but we’re certainly willing to challenge our predispositions. Chad’s analysis here, I personally think, is quite compelling …

  • Nancy

    Unfortunate news. Prefab seemed like such a great option – but I have heard a couple of stories to back up your claim. We just built a house out of SIPS, and prior to having it built, we talked a prefab company and there was no way they could build an existing design for under $200/SF – at least the one we liked would be $250-300. They priced out our design too, and they claimed the cost would be about $200, but too many things were not accounted for (like anything we could get locally, and they didn’t exactly specify what mid-high end finishes would be). Although we chose to go with SIPS for a lot of the right reasons, we figured it cost about 20% more than conventional stick built — so not necessarily an immediate cost saving.

    • Copeland

      We are building our own SIPs house kit right now- received the foam yesterday, and foundation work begins next week! So I’d like to offer others to follow along on our construction costs post- to see whether it comes within their idea of an affordable but efficient home:

      Also the project will be detailed in the blog:

      • Chad Ludeman

        Copeland has a good project there and it will be interesting to see how the final costs stack up to conventional stick building and prefab options.

        Preston linked to a good prefab article related to the topics in this post a few weeks ago in one of his WIR posts –

        Keep in mind with SIPs, the total cost of all materials and labor must be taken into account for a true comparison to stick built. All of the insulation and sheathing is included so comparing lumber costs only to SIPs material costs is not a fair comparison. Also, comparing batt insulation used in stick built homes is not a fair comparison either in terms of cost. Blown in cellulose or some type of spray foam will be better comparisons and much more costly than poorly installed batt insulation. Again, we’re talking about energy efficient, green homes, not standard homes…

        Thanks again for the supportive comments so far. I’m still waiting for the ones that disagree out there.

  • donald trotter

    The conclusins in this article make emminent sense to me. I have seen prefab designs I like, but when I see the psf cost, it is clear to me that a site-built house would be cheaper. In my area, $150 psf (w/o land) yields a medium high level of finish. I have not seen a pre-fab option in this range, except perhaps Rocio Romero, who offers a “kit” which is basicaly the shell of the house. The example projects on that web site indcate that “sweat equity” can render a psf in the more affordable range.

  • Scott Sanders

    This post was a great commentary on quite a range of topics. Chad makes great points about the reality of prefab construction and needs to add one more thing – most Americans aren’t interested in the “cutting edge” architecture of the majority of prefab houses.

    In the next section, Chad talks about the hybrid prefab/site-built approach and lists five points to make it successful: 1) Quality, stock plans, 2) Educated clients that know they aren’t buying custom, 3) Prefab building envelope, 4) Internal prefab components 5) Better scheduling and coordination. Many national production builders are doing 4 out of 5 of those items with the exception of internal prefab components.

    They have a set line of plans that customers choose from that has been value engineered to wring out as much material cost as possible, they present buyers with a short, standard list of options and changes they can pay for, a few use panelized construction where wall panels come out on a truck and are craned into position or placed using a forklift, and most have excellent scheduling and coordination with trades and building officials.

    So how do you make your hybrid method compete with theirs? Build in single lot infill locations where they can’t/aren’t building, offer new materials and methods such as SIPs and modern interiors and exteriors, and leverage the fact that you will be working with them from start to finish, not a sales rep, then a construction supervisor, warranty supervisor, etc. From what I know about the 100k house an it’s team, it sounds like you’re right on in making it work.

    I also have to note that the 10 largest “tract builders” build only about 26% of all new homes, the 100 largest build only about 40% total, and the 400 largest build about 46% total, not 80% as Chad mentioned. Also, #400 (and many further up the list) built about 100 homes in 2007, hardly what I would call a “tract builder”.

    • Chad Ludeman

      Excellent points Scott. Thanks for the stats on “tract builders” in the US. I should have kept is more vague in alluding to the 80:20 rule – 20% of the national builders are probably building about 80% of the home stock.

    • Dale

      As Scott notes, the custom and semi-custom home building sector hasn’t been touched by the big tract builders or prefab manufacturers. This makes it the only industry I can think of where a large capital item is supplied onezy twozy by small scale entrepreneurs. The market demand is being met by companies that are literally worth less than the next five homes they build.

      This is a market that is definitely ripe for the economies of scale that big companies provide, but no one has a clue yet how to do it.

      You can bet they are strategizing as we speak, since conventional greenfield development is in its death throes. I don’t think it will be very long before you see a Toll Brothers target a cheap, existing urban neighborhood with “potential” and try to silently buy everything in sight. Then the model home goes up, and you drive around with the sales person and pick your lot out. Only this lot will be sandwiched by two rundown “scrapers”.

      And small developers like Chad only have a few month lead in the style, materials, and energy consumption categories. The big guys must adapt quickly to the market demands because the consumers are finally learning of better options than the old “drive till you qualify” tract homes.

      How to prevent getting swamped by large builders in a couple years? Get some cash and credit, and go buy those homesites NOW. Target the places with job growth. Land is almost free in Detroit, but there is still no chance of profit there.

  • darin dougherty


    Very well written. As an architect, I have been contacted on several occasions with potential clients who are very excited about saving money using a prefabricated method. We’ve done the best we can to let them down gently, but the cost of prefab is indeed more expensive than custom site built construction (at least here in Portland). One client in particular purchased a gorgeous lot with a great view of the city, purchased plans from a well known prefab company and was ready to get rolling. Unfortunately, after the additional architect’s fees to customize portions of the plans and to prep the site for construction, they were looking at $300 per s.f. (and this was a couple of years ago). Unfortunately, they had to sell the lot, which was developed by a ticky tacky tract home that completely ruined the site.

    We’ve started a project using a hybrid method that is under construction now completely built out of SIPs. The home is a spec house we’re targeting for LEED platinum. We’re realizing all the advantages of prefab. To date, we have poured footings and foundation walls and the interior slab on grade. We will begin erecting the panels, which are on site in the next day or two. Cabinets, windows and many other items that typically are ordered once framing is complete has already been ordered.

    You can follow along here:

  • Dave Wax

    Hi Chad,
    First off, this is the best post on pre-fab I have every read. I have been looking at this market for 5 years now trying to figure out what was going on and how we could bring costs down. I, like you, finally concluded that with the current structure there is no way that this could happen. That said I have two interesting storiesexamples of how my new company FreeGreen will be testing out some of your hybrid models over the next couple of months:

    1) FreeGreen (which provides Free Green House Plans while working with green product vendors on an advertising basis to specify their products into our plans) is going to be releasing a new SIP based plan in conjunction with our SIP partner R-Control in October. This is the first of a 10 plan deal that we have with R-Control. Since these plans are free and fully integrated with SIPs (and of course the other green technologies that are always in our plans) it will be directly testing your first hybrid method.

    2) We are about to announce the winners of our FreeGreen Challenge Contest (a contest where our users competed to win a free custom design). One of our winners actually priced out a number of pre-fab systems for his land, each of them coming in at $350 to $450 a sq. ft. We are going to work with this winner to design a green, modern, site built home that will easily beat those prices (and then of course post the design to our site for everyone to download free). OK. Sorry if this seems like a bit of a commercial, but the article really struck a cord with me and my business is what I know these days. Looking forward to working with you Chad to see if we can right this ship.

    Dave Wax, CEO FreeGreen

  • Josh Stack

    Those here might also be interested in Bensonwood Homes, a genuinely fantastic company that offers, in my view, a uniquely invaluable and different perspective than the current form of most pre-fab, including the “affordable” market.

    My biggest hesitation with pre-fab and applying a manufacturing model to the built environment was about the harms of standardization and using technology as a substitute for skill. But I believe Bensonwood has figured out the appropriate use of prefab technology, not as a substitute for skill, but as a tool of craftspeople.

    That makes all the difference in the world.

  • Josh Stack

    and their website:

  • Avi Telyas

    Indeed, Chad, modular of prefab construction has been the next best thing for the past 100 years. A great many architects and business people have tried to realize the dream of industrialization in construciton without a single notable success. Interestingly, the latest show in prefabrication at the MoMA in New York, called Home Delivery, (where our Company Kullman has a building) continues this fascination but again without offering any evidence of broad based appeal or acceptance for this building method. Although you think you offered an answer to why this is so in your article, In my opinion, you failed to look a the broader implication of modular construciton.

    Like others, you are looking for modular success in the wrong places. That is, most of the activity in this space has been for the single home building type. My Company, Kullman Buildings Corp. ( on the other hand specializes in the multi story, multi tennant building types where the benefits of volumetric modular construcion go beyond just cost. As an example, I can point to a project we did at Muhlenberg College last year. The College year ended on May 14th. We moved in to demolish and tear down 5 wood buildings and build foundations on May 15th. We started delivery of the modules on June 15th and by August 15th, a mere 90 days after the last student left his dorm, student were in their new brick, steel and concrete dorms paying rent a year ahead of what a conventional site builder would have delivered. Further, there was no disruption on campus, no runoff on the steep site and yes, no waste generated on site. the cost was comparable to convetional construciton, though honestly we should charge more for this wonderful benefit.

    The modular industry’s (and MoMA’s) preoccupation with the single family residence type will continue to frustrate the onset of a large scale prefab industry that is able to bring to bear the true benefits of industrialization. What is needed is a fresh focus on what we at Kullman consider the “killer app” of modular construciton which is tall (12 story) multi rsidence building types. The economic of mid rise modular buildings are much more attarctive in comparison to the economics of a single family residences, much like the economics of a $10mm loan are more attractive than the economics of a $250K loan. When developers and owners begin to value time to market like universities do, the benefits of modular construction will be recognized and more successes will be evident. Though it preoccupied us for many years, Modular construction is truly in its infancy and although it captures less than 10% of all building projects annually, the economic trends are poinitng to a much brighter future.a

    • John W.


      When is that book “Modular Methods” going to be finally published? I see it on the website, but the link goes nowhere. I’d love a copy, but have heard no updates.

      • John W.

        I’m sorry, the proper title of the book is “Modular Architecture Manual”.

    • John W.


      You’re the only one here that ‘gets it’. If the current interest in prefab constructions goes the way of all those in the past, so fascinatingly chronicled in the MoMA show (6th floor travelling exhibit gallery), you’ll have blogs such as this, Dwell magazine, Metropolis magazine, Residential Architect magazine, Architect magazine, etc. to blame- and they’ll absolutely BE to blame. Prefabrication is about P R O C E S S, and not about product. Any method will result in product, but if you’re really interested in prefabrication and what it has to offer not only the housing industry but all occupyable structure history, you’ll have to understand this critical distinction. Kullman clearly understands this, and its work demonstrates this repeatedly. In their excellent 2003 book, “refabricating Architecture”, Kieren and Timberlake slam this point home over and over again, and if those who gush over glossy pictures of a Marmol Radnizer or Jennifer Siegal project would try, in earnest, to understand this, then perhaps prefabrication will survive the stupidity and ignorance that has killed all the past iterations chronicled at the MoMA show that ended in October.

  • ERD

    Isn’t expandable polystyrene foam used in SIP’s? Isn’t that stuff pretty nasty to the environment?

  • Dougist

    After going to the MoMA show on Pre-Fabs I asked the question, “Why don’t pre-fabs seem to work?” and answered it here…

    Your post is very well written and I only touched on a few of the many points you made.
    But I ended up speaking on the idea of pre-fab as a tool for urban design experimentation – not the grand hopes for all in the industry but a nobel contribution never the less

    Lloyd Alter of Treehugger was kind enough to leave a nice comment.


  • dlm

    I appreciate the in depth research and report that went into this article and I too agree that prefab is not were we want it as of yet but I like to think in a positive manner my belief that it may be a valid option someday. I would also like to add that your notion of a hybrid pre-fab vs. stick built process is an excellent possible solution to the manufactured home process and warrants further study.

    My displeasure with the writer’s comments is his recommendation of stock plans and the idea of producing more cookie cutter choice houses. The fact is there are thousands of those plans flying over the web, in books, magazines and racks at your local Home Depot. I for one am growing tired of the “McDonalds” look alike house that are produced by cheap minded money grubbing contractors and developers who don’t give a damn about the quality and value of living in America. It has to be the same old suburbia look that everyone is dying to have???

    I am referring to single family detached…I am not really sure I am excited about having “slick contemporary” modern homes becoming the norm either even though that is my style of choice. I think people having variety and choice is always best.

    Lets follow that up with the architect…All the comments presented by the writer pretty close to truth and reality about custom designed homes. But a lot of people may hire an architect for the plans and that is it…the professional is cut out of the rest of the process. And the process is what is important. It is a learning and growing experience for the design professional and the owner. Architects can help with the bid process picking out interior finishes and details, and help in finding high quality fixtures and equipment for the right price; or they can provide alternate ideas. There are always unique ways of doing the “business as usual” process you just need to find the right designer for you.

    Contractors and developers are always using the unknown as excuses to raise prices, I say don’t let them get away with it. Do you take the first bid that comes along when you are tying to sell your house, do you not expect to barter with the car salesman? Were I appreciate the thoughtful recommendations of the writer in this article it is still seems presented in a typical construction as usual persuasion…how one can side step some of these costly pitfalls. Instead I say lets change the process and work designer, developer/contractor, and owner as a team with all the information out in the open.

    I apologize for the negative connotations of my response but when I see “STOCK” plans as an option it drives me batty. But thanks for the helpful antidotes.

  • Robin the Energy Saver

    The argument that prefab homes involve a lot less waste sounded so believable until this series of articles (here and on other blogs) dispelled the myth. It seems like efficiencies of scale apply where the big guys want (as in, reduced cost, hence higher profit magins) and are touted, but not actually realized, where the buyers want (as in, ‘greener homes’ but not really).

  • modern architect

    An interesting article. Perhaps prefabricated houses such as NOMAD home aren’t quite as eco or as cost-effective as they make out, but the pre-fabrication process should not be ignored – if more people would go in that direction, the benefits would really be seen. Also, it certainly works with projects such as this:

  • John W.

    It’s rather amazing that such a well-conceived counterpoint argument to the current prefab craze ultimately falls into the same trap as those who drool over the glossy images in Dwell magazine. This article, otherwise so thorough in its deconstruction of the well-travelled, bullet-point spin typically offered by the likes of (insert your favorite Dwell magazine star architect, and his/her signature project), manages to miss the most important advantage that means of prefabrication offers to a project, which is of course, economy of scale. The Dwell homes by Empyrean are prefab… but… why? They happen to be prefab, but who cares? That’s dumb. There is no earthly reason to use means of prefabrication for a one-off or singular project that can just as easily be built on-site. The author’s counterargument in the article seems to only address those that believe the standard fare published in Dwell and the usual green gadget blogs is what deserves mention, and completely misses the real advantage of means of prefabrication. Is prefab more green? Maybe… but who really cares? If one fails to even mention economy of scale and the natural advantage that prefabrication offers to a large project of repetitive units, has one really offered a convincing counterpoint argument to prefab? Of course not. Are you building singular prefab projects? Really? Why? That’s just dumb. Silly Dwell magazine and green gadget blog reading [mostly architects]… prefab is for large, multiple unit projects… not one-offs. If you haven’t figured this out, you deserve to waste your hard earned money on a dumb project. It’s also worth mentioning the title of the article includes one qualifier that taints this article from the outset – ‘modern’.

  • Norman Solomon

    Wow, this was by far (Chad Ludemen’s article) the most informative (and accurate) assessment of so-called modular or pre-fab homes. I just completed extensive research on modulars and can vouch for virtually every item mentioned.I am not a builder or architect, rather, a potential buyer looking for an innovative approach to building a small house. 25 years ago we built a “hybrid” house in Switzerland which utilized incredibly advanced SIP type panels. I suspect that the SIP panels readily available today could make very useful “building blocks” in designing a home especially in Vermont.
    Norman Solomon, Brookline, Vermont

  • Joseph Guerrero

    Hello Chad,
    I have found your article very informative, particularly in pointing out the differences between the MODULAR, PRE-FAB & HYBRID.
    As a fan of CLASSIC MODERN ARCHITECTURE I am not concerned about the “regular/average” homes, but my focus is strictly with the (ECOHOMES)modernist pre-fab designers such as MARMOL RADZINER, FREEGREEN (the view box greenhome), LIVINGHOMES (RK1, RK2, RK4, RK5). & ROCIO ROMERO.
    My intention is to do projects here in Arizona with such products and/or use an architect builder such as MICHAEL P. JOHNSON for the larger custom homes.
    I appreciate your take on the pre-fab/modular homes, and you are certainly more experienced on the topic than I, would it be possible to get your oppinion on the above builders of said products? you are more knowledgable than I on this topic and it would help me tremendously.
    I am in Real estate, in land aquisition and development (put sub-divisions together) and with a group of investors want to build CLASSIC MODERN HOMES (GREEN), for both, the more affluent that will downsize and for the lower brackets a simpler affordable highly efficient dwelling (GREEN).
    Please advice,
    I thank you in advance.
    Joseph Guerrero RE/MAX EXCALIBUR Scottsdale Az. 602 740-1132
    I am also an artist; Joseph Breton

    • Bud Wood

      We just sold our residence so have been looking at PreFab. They seem rather “pricey” for what one gets. The hybrid homes sound interesting.
      I self-contracted two homes. Each seemed to have taken several months but certainly not 12.

  • Anonymous

    Are you all kidding me!? This guy is a builder, hence the PreFab industry gives him NO work. He builds stick houses! So you mean to tell me that I can take a manufactured car and buy it from a dealer for more than I can buy all of the separate parts and components and build it myself? NO. And also what he’s saying with “Hybrid” so now you don’t only have the overhead of the factory for prefab, which is absolutely expected, but you have the overhead of his pockets, the panels you buy company, shippers, installers, carpenters, catch my drift? Whereas the prefab is all upfront and know the cost.. If your going to let this change your mind on PreFab go ahead and be influenced by someone who is completely biased. Look at his job title! I’m still going to prefab

    • Carl Sloan

      Regardless of his title, the article is factual. Comparing the cost of building your own car from parts as opposed to buying the complete car is misleading and irrelevant. That’s NOT the same thing. Do some research and you’ll find that MODERN prefab homes are VERY expensive per square foot. $300 – 400 psf is the norm. That’s WAY more than a site-built home costs.

  • EllieB

    You realize that you made yourself look like an idiot and therefore caused yourself to lose all credibility in the fact that you compared apples and oranges. You said that they dont generate less waste because they use more raw materials and you can recycle 90% of the waste you produce. But, they create less waste on site, so they need more raw materials and because they recycle what they dont use, there is no “90%” its much closer to 100%. And it’s also greener because there is less gas wasted lugging the materials to the site and lugging the remainder away.

    And about your insulation bit, most companies you structural insulation. This is a foam product that fits in each panel and does NOT move. It also has a higher r-factor than other products.

    As far as your cost comparisons, I challenge you to show me proof of the exact houses being completed at 150$ with the same materials being used. It doesnt count if you can build it cheaper with cheaper products. The average cost of materials for an average home is 200-250$ per square foot. And that’s IF everything is made properly and it’s all on time. If it’s not it can easily jump to 300-400$ per square foot.

  • alan scouten

    Almost everything said here is untrue. I built my 4,000 square foot SIMPLE (Structural Insulated Metal Panel Living Environment) house in Charlottesville, VA (2002) for under $100 per square foot. It is presently appraised for $600,000 dollars.

    A House is worth a thousand words….Check it out.

  • Anonymous

    Interesting insight! Thanks for sharing!

  • Geoffrey

    I disagree with the blanket statement that site built takes 4-5 months. The only houses I’ve ever seen go up that quickly are the lowest grade turn-and-burn builder houses with completely conventional systems typically seen in Philadelphia.

    • Erica

      I was seriously wondering about that statistic as well. I’ve been involved in several stick-building projects now and none of them have taken fewer than 12 months – which has been one of the singular attractions to me of prefabricated homes. The ease of working with a single group of people, rather than the mess that is typically a hired builder who subcontracts most of the time is well worth paying the same, or slightly more, than a house built from the ground up. The prefab homes that have attracted me though, are from – houses constructed almost entirely out of bamboo – a highly sustainable resource.

      Also, consider the cost of shipping a complete home, versus the cost of shipping all of the individual pieces of that home to the same location.

      The article brings up some good points, but there are too many factors not accounted for.

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  • Anonymous

    On May 11 McGraw-Hill released a very comprehensive study on Prefabrication and Modularization. The report is very comprehensive and based on surveys of people in the industry.  It is also free.

    Also bear in mind that the majority of the wood-framed, high-performance (green based on actual performance metrics as opposed to a checklist) buildings certified as passive house (more than 30,000 buildings in total) were prefabricated.  This data from the director of the Passive House Institute, Wolfgang Feist.

    Also, the majority of the wood-framed buildings constructed to the strict Swiss Minergie standard (20,000+ buildings) are also prefabricated.  Data from Reudi Kriesi, co-founder of the Minergie Union.

    As a builder/fabricator with experience on more than 1,000 fabrication projects in 10 countries, our perspective is based on decades of experience.  We are also so busy we can’t begin to keep up with demand.

    For more info read Ryan Smith’s new book on “Prefab Architecture”

    or Colin Davies’ classic,  “The Prefabricated Home”

    An innovative idea:  In any discussion of fabrication it would be good to include fabricators and not only architects. 

    • Anonymous

      correction to Mr. Howes, Mr. Ludeman is not an architect, but rather a developer and builder.

  • Joe

    I am an architect, but I also have a builder license. I designed several custom modular homes and built a few of them. 
    a. The modular homes are affordable: They are cheaper to produce. The factories are selling the homes to third party builders and they are establishing their own prices to the costumers. But they can drop the price because the product is cheaper including the crane and  the overhead.
    b. They producing less waste: Yes they are. Visit a factory and compare it to a job site. Yes, they have to reinforce certain areas, compare it with lumber sizes calculated by lumberyards or guessed by builders. 
    c. Less time: Yes, much less time. They can build and set a 6,000 SF home in a month, the builder can finish it in five month. It is correct that the design and the pre-construction will take another six month, but this would be the same with a stick build project if you want a good design.
    d. Less green: No difference. Each type of construction can be as green as you want them to be.

  • Applebad

    wood is a poor insulator …..

  • N_bakunda

    I’ve always wanted to build my own home… there is something rather vulgar about living in a cookie cut subdivision, and while i know prefab is more or less the same thing – i mean there is someone out there with the exact same house- it appeals to me because of the other advantages, like common sense living areas (who needs 3 baths?) and the green factor! But they are exorbitant. I thought the point was to save on energy costs and waste, not make up for it in the cost of actually getting the thing. Its horrible. But only in the US. In China for instance, there are a number of companies that are selling prefab units about $100/sqft. They are functional, and meet the purpose of not spending $232,000 on a 1000sqft of house. Its embarrasing. green is supposed to the natural choice… not the luxury option! Good read…

  • Izabela Wojcik

    Hi Chad! Excellent review! I’m an ornamental metalwork and lighting designer in Dallas, and one of the builders I work with brought in a client today. We ended up chatting about pre-fab homes, because one of the latest homes he’d worked on was a pre-fab. He did mention that the cost is almost the same and I have had the idea of a contemporary pre-fab home for myself for quite a while now, so I thought I’d look into the matter. From what I’ve been finding, you’re right on the money! I was sad, but what can I do… keep waiting till something better comes along I guess:)
    Again, thanks for the excellent article.

    • Preston

      Izabela, keep in mind this article is nearly 4 years old. The world of prefab has evolved significantly in that time. I wouldn’t necessarily foreclose the option of prefab these days with the proliferation of new companies and new options.

  • Mike

    Well, in response to this article, these beautiful prefab homes come in around $155 p/SF. They are really nice, roomy and beautifully designed with very nice finishes. So, I guess this is one company that would prove this article totally invalid.

    • Chris

      About Method Homes being affordable… We went by the numbers on their site and it was doable. When we emailed them, they said it would be 225 pzSF. We emailed again to ask about the details that raised the cost and did not get a response. To bad, we were really enthused about their home. Our max budget was 550,000 for lot and everything. The home was around 2,000 square feet and totally undoable. We found the same results when contacting other prefab companies.
      Another thing we noticed was that many companies had some pictures of only one or two homes they actually built. If volumes are low, then they need to make all their profits on the house they actually build.

    • Chris

      About Method Homes being affordable… We went by the numbers on their site and it was doable. When we emailed them, they said it would be 225 pzSF. We emailed again to ask about the details that raised the cost and did not get a response. To bad, we were really enthused about their home. Our max budget was 550,000 for lot and everything. The home was around 2,000 square feet and totally undoable. We found the same results when contacting other prefab companies.
      Another thing we noticed was that many companies had some pictures of only one or two homes they actually built. If volumes are low, then they need to make all their profits on the house they actually build.

    • Carl Sloan

      The author is talking about MODERN prefab architecture, not gussied-up sheds. Let us know when you find a prefeb company offering MODERN designs for that price.

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  • Coy Coleman

    The more attractive ones are $180K to $380K. The rest are slapped together with staples. They look really nice but are of poor construction.

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