There is both a funny and a serious side to the concept, now supposedly available for the western states, of buying a prefab house already furnished and having it delivered.
My first reaction to this was to have fun with it:
Visions of convincing a bank or credit card company that it is a legitimate purchase, but how it cannot be shipped to the address on the account since it is a "new" house. Chances are the delivery people are not including hauling away the current house on the property as part of the deal. Wondering how the delivery people will find the address to bring the house, since there is no house currently on the property.
Then there are matters such as having electrical and plumbing facilities in place so that the new house can be fully functional upon installation. And in the right place at that. This doesn't even include any local ordinances and comparing the size of these prefab homes with those in the neighborhood.
Try getting conventional financing when there is no home in place to be appraised, and the price is the price, including furnishings and appliances.
However, if this is serious, there is opportunity here for consumers and for realty agents. An enterprising consumer could probably get a great deal on residential land in a lot of areas where little to nothing new is being built. Heck, a large lot might be able to hold two of these things and enable an entrepreneur to possibly live in one and rent or lease out the other. There are not many opportunities in most areas for 2 furnished and "ready to go" homes to do such a venture for less than $200,000 (although this does not include the cost of the land).
Even at one prefab house for less than $90,000 (not including the land), it seems a reasonable deal since it includes furniture and utilities, as well as the setup.
I'm wondering if a realty agent could come out with a commission on the sale of the land, and then not have to go through the hassle of issues with the prefab home, since that is a direct purchase. It would make for a much "easier" commission for agents who see this opportunity.
More importantly, it would get more people into more homes. That's what it should be all about.
Some developer or investor could do well with a 'discount' purchase of residential land, and then by filling it up with prefab housing. In and near larger cities, they could do a 10-year "lease to buy" of $1,000 per month, and likely save the "tenant/buyer" quite a bit of rent money. After the 10 years, the developer/owner pockets $120,000 (for the $86,000 home), and can then charge a "move-in" fee of thousands more. This after the depreciation of the homes and paying off on the land their group of prefab houses sits on. All without design, building, and installation costs and hassles.
Sure, the furniture company involved in these wants to find more ways to sell its items in volume. But my hope is that realty agents, investors, and unconventional lending sources will take a serious look at these opportunities. This is "easier" than dealing with foreclosures and REO's, and would help to spur the real estate market.
That part is not prefabricated.
Places in Time III
4 days ago