Quick Guide to Pre-Fab ADUs: Manufactured vs Modular vs Panelized vs Stick-Built

Accessory dwelling units are gaining popularity as more people need housing options that can adapt to their evolving needs. You may be wondering if there are pre-fab ADUs that 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, pre-fab vs. stick-built ADUs will stack up differently. Which type of ADU is right for you? And first off, what is a pre-fab ADU? Read on to learn about the tradeoffs of each ADU build type. We’ll cover the considerations if you go the pre-fab route to help you assess what kind of structure could best suit your needs.

Granny Flat Build Types: Pre-Fab vs Stick-Built ADUs

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

• Stick-built means that the structure is built directly on-site 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 prefab construction.
• Pre-fab can mean several different types of construction. In general, prefabricated or prefab refers to a structure that is at least partially built in a factory and brought to the property to be set on a foundation. Pre-fab 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.

Manufactured ADUs = Structure built entirely off-site

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 and manufactured housing is now regulated by the U.S. Department of Housing and Urban Development (HUD). 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.

Modular ADUs = Sections built off-site and assembled / finished on-site

Modular construction is a type of prefabrication where sections of a building are built in a factory, and then transported to the building site to be assembled. This method can sometimes be more efficient and cost-effective than traditional construction, as the 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 main differences between a manufactured ADU and a modular 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 requires additional work on-site to complete the build. As with manufactured, modular has more difficulty with regard to financing & appraisals options. Modular ADUs are typically less customizable vs stick-built ADUs.

Panelized ADUs = Walls built in factory and shipped to site

Panelized is a compromise that takes advantage of controlled factory conditions for efficiency and speed, but still allows for customization. Panelized construction is when the outer shell or frame of the house is built and transported as flat panels that can be transported to the home site. The panels are then set into place, either with a crane or by hand, on-site at the foundation of the ADU. Plumbing and electrical work is added after assembly, as is all finish work from insulation and drywall, down to all the millwork. Panelized construction is considered a stick-built product and inspected as such, meaning it has the highest appraisal values and is easiest to finance. Typically, clients find it easiest and most efficient to choose a plan, then customize the layout only if needed. This semi-custom approach also keeps costs down; it’s a hybrid that allows customization but keeps ADU prices reasonable and can shave weeks off the build timeline.

Pros and Cons of Pre-Fab ADU options

So how to determine which build is right for you? The answer depends on which factors are most important to you in the ADU project.

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

Can pre-fabricated ADUs be customized?

In Coastal San Diego, we are often dealing with unusual lot sizes and shapes, so being able to work within property constraints is important. Also, we tend to find clients like to be able to customize a bit to ensure the layout works well with their property features and challenges. Manufactured ADUs and modular options typically have much less ability to customize the footprint and floorplan vs panelized or stick-built options. Prefabricated ADU manufacturers and distributors typically offer a set line of floorplans. It’s typically not possible to change the way the doors and windows are oriented, which means an available floor plan needs to work off-the-shelf. It can be tricky to find a model that works well with your site if you are space constrained. You have more options for customization with stick-built and panelized ADUs.

Are pre-fab ADUs cheaper than stick-built?

We’re continually surprised that there is not a big cost difference once you do the required permitting, site work, utilities & finish work for manufactured & modular ADUs. For very small units, off the shelf manufactured options can be a good cost-effective solution if they fit and if it is not important to have the unit increase property values (more on that later). 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. 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.

How long does it take to build a pre-fab ADU?

With manufactured and modular housing, 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. panelized construction. Housing manufacturers are at capacity – with less flexibility to ramp up vs panel manufacturers – 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.

How does build type affect financing options & appraisal value for ADUs?

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 is built 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, since you can fully customize the roofline & material, as well as siding and trim work of the ADU, to work with the existing home. When it comes to financing your ADU, the traditional options are based on 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.

A Comparison of ADU Build Types

Each method has its own pros and cons, and the choice between modular or traditional construction for ADUs in San Diego would depend on the specific project, budget, and requirements. Traditional construction may be a better fit especially when the design is more complex or the location has specific zoning requirements.

We’d be happy to discuss what our pricing & timeline would look like for your project, plus run a preliminary feasibility report to determine what you can build. Fill out a contact form to request a free consult.