Prefab ADU Guide: Manufactured vs Modular vs Stick-Built

Accessory dwelling units (ADUs) are gaining popularity as more people need housing options that can adapt to their evolving needs. You may be wondering if a prefab ADU can simply be brought to your site move-in ready and save you tons of time, money and headache. The answer is… maybe. Depending on your goals, prefab ADUs vs. stick built ADUs will stack up differently. Which type of ADU is right for you? And first off, what is a modular or prefabricated ADU? Read on to learn about the tradeoffs of each ADU build type. We’ll cover the considerations if you go the ADU prefab route to help you assess what kind of structure could best suit your needs.

ADU Build Types: Prefab ADU vs Stick Built ADU

There are several options for how to construct an accessory dwelling unit. ADUs can be built as prefabricated ADUs (“prefab ADU”) or traditionally framed (“stick built ADU”).

• Stick built means that the structure is built directly onsite with traditional framing methods and usually made of wood (fondly known as “sticks”). Pieces are cut on-site to the required measurements and assembled directly on the foundation using standard construction methods. This approach can be more flexible and allows for greater customization, but it can be more time-consuming and labor-intensive than a prebuilt ADU.
• Prefab ADU construction can mean several things. In general, a prefabricated ADU refers to a structure that is at least partially built in a factory and brought to the property to be set on a foundation. Prefab may conjure up images of mobile homes or kit homes, and those are one option. We’ll look at each build type, understand what it is, and compare the tradeoffs in terms of cost, time, regulations, financing and appraisal value for your ADU.

What is a manufactured ADU?

Before 1976, manufactured homes were called “mobile homes,” a term meant to apply to RV-type housing built to be moveable. The term “Manufactured” home took its place. Typically, manufactured homes, which are built entirely off-site and trucked in to a location, come in a limited set of off-the-shelf products. If you’re interested, read more about manufactured & factory built home regulations.

What is a modular ADU?

Modular ADU construction is a type of prefabrication where sections of a building are built in a factory. They are then transported to the building site to be assembled. This method can sometimes be more efficient and cost-effective than traditional construction. Sections can be built in parallel with site work, saving time and labor costs. It also offers a higher level of quality control and precision as the units are built in a controlled environment, where the process can be closely monitored.

The key difference between a modular ADU and a manufactured ADU is how they are built. A manufactured ADU is built like most traditional houses with a slanted roof and beams. A modular ADU is built and framed like a box with walls, floors, and plumbing. Several of these box-like structures can be put together to make rooms, and then the rest is assembled on-site. Modular ADUs have most of the work done prior to being transported to the site. Modular ADUs require additional work on-site to complete the build. As with manufactured, modular ADUs have more difficulty with regard to financing & appraisals options. Additionally, a modular ADU is typically less customizable vs stick built ADUs.

Pros and Cons of Prefab ADU Options

So, how do you determine which build type is right for you? The answer depends on which factors are most important to you in the ADU project. You should consider the following:

• Customization to your property?
• Prefab ADU Cost?
• Timing of payments?
• Overall speed? On-site speed?
• Ability to finance the project?
• Property value addition?

Manufactured ADU and Modular ADU Customization

Manufactured and modular ADUs typically offer less flexibility in terms of footprint and layout customization compared to stick-built options. Most modular ADU manufacturers and distributors provide a predefined set of floor plans. In many cases, adjustments such as changing door or window placement or reconfiguring the layout are not possible. As a result, the chosen plan generally needs to fit the site without significant modification.

This can present challenges for properties with limited space or unusual shapes. In contrast, stick-built ADUs are constructed on-site, which allows for more adaptability in design. This flexibility can be particularly beneficial in areas with irregular lot sizes or unique property features. In Coastal San Diego, for instance, lot dimensions and configurations often vary, and local conditions may call for more tailored solutions. Some homeowners value the ability to fine-tune their ADU layout to better align with views, privacy concerns, or existing structures.

A helpful analogy: a custom-built ADU can be likened to a tailored suit, while a prefab model is more similar to an off-the-rack option.

Considerations for Prefab ADUs

Prefab ADUs are generally designed as standardized units, intended for broad applicability rather than specific site customization. While this can streamline the building process, it may require careful planning to ensure the chosen model aligns well with the existing site. Site conditions like fencing, trees, slopes, patios, and nearby structures can all affect placement.

In some cases, a model may meet general needs but run into issues for the site specifics. Examples would be doors or windows needing to be repositioned to accommodate setbacks or privacy preferences. With limited ability to modify the structure, these situations can be difficult to resolve without additional permitting or workarounds.

Customizable Prefab ADUs: Opportunities and Limitations

Some companies offer customizable prefab ADUs that are built off-site and tailored to certain property constraints. These solutions can offer a balance between efficiency and personalization. However, even when designed for a specific lot, the logistics of delivery and placement remain important considerations.

A prefab ADU is often transported in large sections or as single units. Maneuvering them into place can be complex, especially on narrow lots or properties with uneven terrain or existing obstacles. In such cases, cranes may be used to lift and position the units. However, this requires sufficient clearance and access. Features like power lines, trees, or nearby buildings can limit or prevent installation.

These logistical factors are worth evaluating early in the planning process to ensure that a prefab approach is feasible for your site.

Prefab ADU Cost

We’re continually surprised that there is not a big cost difference once you do the required permitting, site work, utilities & finish work for a prefab ADU. For very small units, off the shelf prebuilt ADUs can be a good cost-effective solution. However, this is only true if they fit the lot. Typically, the price differences will be negligible for large ADUs; stick built is price competitive with manufactured homes for large ADUs.

Be sure to check for all the costs associated with each build type you consider, including those sneaky site-specific costs. Plans, permits, sitework, utility connections, delivery, finish work & finish materials are important items to make sure to clarify on whether they are included and what could trigger additional charges. Also, most manufactured housing requires a sizeable deposit upfront, since the building is constructed offsite, vs in phases on-site. This means manufactured ADUs and often modular ADUs require more money out of pocket upfront and are more difficult to get financed.

Manufactured and Modular ADU Timeline

With a manufactured and modular ADU, the on-site construction portion of the work is definitely shorter – a few weeks vs a few months for traditional construction. However, the overall timeline – from the time you authorize the project start, to the time you move into the ADU – is typically about the same for manufactured vs. stick built construction. Housing manufacturers are at capacity with less flexibility to ramp up, which means the queues for building these homes are significant. Many manufactured and modular housing providers are quoting average factory build times of 4-6 months to complete (after permitting, which would still take the typical 3-4 moths), with installation as short as a few days to a few weeks.

Manufactured and Modular ADU Valuation & Financing

Adding a accessory dwelling unit not only offers the option of more living space, but can also increase the resale value of your home significantly. Typically, you will see the highest appraisal values coming from stick-built ADUs. If your accessory dwelling unit exterior is designed to blend with the primary home, it can result in a higher property value. It’s typically easier to achieve this blend using a stick-built construction. You can fully customize the roofline & material, as well as siding and trim work of the ADU, to work with the existing home. If your home is located within an HOA, matching the exterior to the primary home may actually be a requirement.

As the popularity of ADUs surges, it’s essential to understand that not all ADUs are viewed equally in the eyes of lenders. The valuation of properties, whether for lending, appraising, or buying, is often rooted in perceptions. It’s about how a lender, appraiser, or buyer “feels” about the property’s worth and how it compares to neighboring properties.

This perception-driven approach poses challenges for manufactured housing. Most manufactured homes, excluding those with pre-built wall panels, necessitate non-standard or raised foundations. As a result, they often have a distinct look and feel compared to Primary Dwelling Units (PDUs). While potential buyers might overlook these differences, appraisers and lenders typically don’t. Securing a loan for properties with certain types of manufactured homes can be an uphill battle. The number of lenders willing to finance such properties is limited, and in some regions, they might be virtually non-existent.

In essence, opting for a traditional building method that aligns with the PDU often maximizes the property’s value, making it a more appealing choice for both homeowners and financial institutions.

When it comes to financing your ADU, the traditional options are based on several factors. This includes the amount of equity you have in your home, your income, savings, and creditworthiness. If you bought your home 5 to 10 years ago and have paid off a significant portion of your mortgage, a home equity line or construction loan will be a good option.

SnapADU’s Approach: A Blend of Traditional Stick Built and Innovation

In our early days at SnapADU, we were captivated by the idea of using prefabricated components for ADU construction, envisioning the efficiency of an assembly line. But after assessing thousands of properties and gaining invaluable insights, we’ve evolved our approach.

Today, we champion a traditional building method, but with a twist. We call it the “manufacturing mindset,” with different stages that ensure consistency & predictability. Our process is systematic and enhanced by technology, such as our heavy use of project management tools. Even if we have to adjust the length of a board for different projects, our method of handling and cutting remains consistent.

Combining traditional building methodology (site built/wood framed) with a 21st-century approach allows us to be not only customizable and flexible but also replicable and scalable. It might not sound glamorous, but our success hinges on flawless execution and meticulous follow-through.

Read more in our Guide to ADU Construction.

A Comparison of ADU Build Types

Is a Modular ADU Better Than a Stick Built ADU?

The answer to this question depends on your priorities. If speed and budget are your primary concerns, a modular ADU might be the way to go. However, if you’re looking for a space that fully reflects your personal style, meets specific needs, and harmonizes with your existing property, a custom ADU is likely the better choice. Traditional construction may be a better fit when the design is more complex or the location has specific zoning requirements.

At SnapADU, we specialize in standard and custom ADU designs. We guide homeowners through the process of turning their vision into reality. Our team is here to help you navigate the complexities of ADU development. We take pride in ensuring a smooth and successful project from concept to completion. Whether you’re leaning towards a modular ADU or considering a custom build, we’re here to provide the expertise you need.

We’d be happy to discuss what our pricing & timeline would look like for your project. Fill out a contact form to tell us more about your property and get started.

Comparison of Popular Prefab ADU Companies

Check out our article comparing popular manufactured and prefab ADU companies.