When buying a new home, whether for your family or as an investment, you may have considered prefabricated construction rather than the traditional method. More and more people are discovering the benefits of prefab houses in terms of:
- Construction process
- Environmental benefits
- Consistent quality
- Appreciation and value
So is prefab cheaper than building using conventional methods? What makes modular homes so appealing to homemakers and investors alike? Our guide covers everything you need to know about prefab homes vs traditional homes and surrounding questions.
How Do Prefab Homes Work?
“Prefabricated” means that the main elements of the house are built off-site in a factor. Components such as walls, foundations, and roofs are built to measure by trained professionals using cutting-edge equipment. The materials are moved to the site for assembly when fabrication is completed.
This means that the assembly process is much faster than the traditional building method from the ground up. A panel-built home can be assembled in 3-4 months, sometimes even less, depending on the size of the project. Traditional construction processes typically take around a year, with a common problem in the industry  being projects running overtime and over budget.
As fabrication occurs in a controlled factory setting rather than on a building site, prefab homes are much less likely to experience delays due to bad weather, a pervasive issue with construction projects. The UK, for instance, experiences roughly 133 days of rain and snow per year, limiting the number of days on-site construction can take place. Because of this, the projected time it takes to assemble a prefab home vs a conventional structure is likely even longer than general estimates.
- The process for assembling a prefabricated home is as follows:
- The details of the project are established between the buyer and the contractor
- All necessary planning permission is obtained from relevant local sources
- The buyer obtains a mortgage to cover the cost of construction (where necessary)
- The contractor surveys and prepares the land
- Meanwhile, the house is fabricated in closely controlled factory conditions
- The home is assembled quickly and to the highest professional standard
- The house is now ready to move into
All aspects of fabrication must meet the highest industry standards to be approved. As these requirements are handled by a central manufacturer and specialists are assigned to each part of the project, there is much less need to communicate with multiple contractors for areas like plumbing, roofing, windows, etc. Likewise, the streamlined construction process means that it is much less likely that the home will have outstanding issues once it has been deemed “complete”.
How Much Do Prefabs Cost vs Traditional Buildings?
In both cases, prices per square metre vary depending on the type of materials used. An advantage of prefabricated homes is that it is easier to obtain an accurate estimate of the cost before the land is purchased – there is less need to account for potential material damages due to vandalism or bad weather. This makes it easier to negotiate a mortgage that suits your investment.
Another factor to consider when estimating the cost is that prefab homes tend to appreciate more quickly than traditional structures. Once the house is established and can be surveyed by an estate agent, its value becomes comparable to that of a traditionally-built design: this is where the savings made during construction become valuable. People looking to build homes to rent or sell will find prefab cheaper than building, and also that these properties offer a much higher yield relative to the cost of construction.
Why is Prefab Cheaper Than Building?
You will almost always find prefab homes cheaper than their traditional counterpart for several reasons:
Shorter assembly time. Contractors charge for how long they expect to spend on a construction project. The more time they spend on construction, the more expensive it gets. Traditional buildings take significantly longer to assemble, making prefab homes cheaper by a significant margin.
Less chance of waste or damage. On-site construction risks materials being damaged by inclement weather or even vandalism. While a contractor’s insurance may absorb some of these costs, this risk is eliminated with factory construction, where materials can be kept safe and dry until it is time for assembly.
Less chance of an overrun. In addition to the projected construction timeframe being much lower for prefabs, buyers are less likely to face additional costs from a project overrunning by several months.
Less need for remediation. Factory-made components are tested rigorously before assembly. It is less likely that the buyer will need to invest in post-assembly changes or repairs.
These elements make prefab homes cheaper as well as more efficient. These are perhaps the most important two features when planning to build a home: are there any disadvantages?
Prefab vs. Traditional Construction: Advantages & Disadvantages
Below we weigh up the benefits and drawbacks of each method.
Advantages of Prefab Homes vs Traditional Homes
Cheaper. Far fewer hours are spent assembling the structure. This makes prefab cheaper than building.
Quicker. Prefab homes typically take less than half the time it takes to build a property on-site.
Less prone to overruns. Traditional construction faces many potential delays due to poor weather. Prefab properties are factory-assembled and avoid this risk.
Quality control. Factory production means prefab components are subject to far more rigorous quality checks than on-site assembly.
Less disruptive. The shorter construction time and swifter assembly process are helpful if you hope to make a good impression on your new neighbours.
Environmental benefits. Less time is spent transporting materials and personnel to and from the job site, meaning fewer emissions. Factory assembly also produces less waste and allows for more efficient recycling.
Advantages of Traditional Construction
Fewer potential delivery issues. Access needs to be arranged for a prefabricated house: as large parts are being delivered, the delivery vehicle must be able to get to the property. However, this can be avoided with advanced planning.
Easier to make last-minute changes. It is sometimes easier to change a project when being built on-site. However, well-planned projects avoid the need for changes.
Rigorous planning should be part of any construction project. This is no different when it comes to prefab homes vs traditional homes. Part of what makes prefab homes cheaper is that the specifications are established very early on. Buyers should be confident in those specifications before starting construction, and the contractor should agree that the project is realistic and deliverable.
Is It a Good Idea to Buy a Prefabricated House?
Short answer: yes. The same factor that makes prefab homes cheaper than building makes them superior in most other aspects. Faster construction times mean prefabs avoid many hazards typically associated with construction projects.
Among the most valuable advantages you gain with prefab construction is that there is far less risk of delays. Delays come with numerous drawbacks, including:
Higher costs. The longer construction runs, the more you spend on the project. Contractors dislike absorbing the costs of projects overrunning, and many include clauses in contracts that at least partly pass the costs onto the buyer. This makes prefab homes cheaper because there is far less risk that a project will overrun.
Strained relationships. Delays almost inevitably mean that relations between the buyer and the contractor start to deteriorate. Nobody enjoys the blame game or re-negotiating a project with a contractor who would rather be done with the project and move on.
Rearranging move-in dates. If you plan to live in the building once it has been completed, the last thing you want is to have to make other arrangements for several months because the project has overrun. This can be extremely costly and irritating – you drastically reduce the likelihood of this problem by choosing a prefab home.
Another huge benefit is that prefab homes offer a quicker return on investment than traditional structures. As a prefab house can be completed faster, it will start generating revenue streams earlier than if it were built using traditional methods of construction. A common worry is that modular homes might not be worth as much to buyers: this is simply not true. The quality of the finished product determines the value, which is even more likely to be higher in a prefab home, thanks to the intense quality control possible in a factory setting.
Prefab Homes vs Traditional Homes: Key Takeaways
So is prefab cheaper than building, and should you do it? Yes. This is why:
- It is typically much cheaper
- Construction is faster
- Superior quality control measures are possible
- Quicker return on investment
- It is more environmentally friendly
- The risk of an overrun is far less
If you are planning a new-build house, prefab is the way to go. Find your prefab house and start your project.
Featured image: model Ketty 1-75