Monday, December 31, 2018

Will Custom Home Builders be Part of Modular’s Future?

Don’t be too quick to say ‘yes’ to this. Actually this is a trick question.

If I had asked if “street dealers” that sell IRC modular and/or HUD manufactured homes would be part of modular’s future the answer would certainly be ‘yes’ but I’m not talking about street dealers.

A Custom Home by Westchester Modular

What will most certainly be missing from modular’s future is the custom modular home builder if the modular housing industry doesn’t begin to make a concerted effort to bring in “new to modular” custom home builders. This primarily affects the Middle Atlantic and New England areas of the United States.

The Midwest and Southeast see mostly street dealers and vertically integrated modular factories selling homes from pre-designed and rendered home plans while the Southwest is almost exclusively HUD housing. The West Coast market is the region where tract builders and multifamily developers are king and there are few single family modular builders nor factories to serve them if there were some.

So, in the Mid Atlantic and New England regions where there are more than 20 true modular factories, the answer to the question of Home Builders being part of Modular’s future is a resounding “Maybe”. And without a quick intervention even those that are currently working as custom modular builders may soon find their ranks diminishing.

There are five main reasons for this. First is most custom modular home builders are card carrying AARP members who have not encouraged their children to follow in their footsteps. Instead they sent their children to college to get a degree in just about anything other than construction. “Mommas, don’t let your boys or girls become builders” and have to struggle through the ups and downs of the housing industry.

The second reason began in 2008 when many modular home builders left the depressed housing industry to pursue other things like becoming remodelers, truck drivers and some even went to work at Lowe’s. They were in their 50’s when the recession hit and are now looking toward retirement more than they are getting back into new home construction.

East Coast modular factories discovering they could build hotels, man camps and large multi-story apartment buildings keeping their production lines running at a profit instead of waiting for their single family home builders to give them orders is the third reason.

Number Four are rising freight costs, over regulation of modular housing at the state level and costly service calls after the sale.

The fifth and probably the biggest reason that the answer to the question is “Maybe” is the absolute lack of acquiring ‘new to modular’ custom home builders and a training program to help them become successful building modular homes.

The best solution to solving the dwindling ranks of custom modular home builders in the Mid Atlantic and New England is solving the last problem of finding new to modular builders and training them for success.

The Modcoach team is about ready to launch programs to address these two areas with a marketing effort directed to getting younger men and women to look at custom modular home building as a career and then helping them become and stay successful.

These were two of the top concerns of the modular housing industry at the “Breakfast with Modcoach” earlier this month and we have listened.

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