COMPACT BUT COMPLETE

Check out our Cover Article in the November 2024 Issue of Off-Site Builder Magazine

https://offsitebuilder.com/compact-but-complete/

Published on31 October 2024

Author

Andrew Holmes

Blockhouse Residential worked to create a home that buyers of moderate means can not only afford, but that also includes the amenities they want. Good design and modular construction made it possible.

• This modular builder saw a market among buyers who have been priced out of the standard suburban home, and wanted to offer something they could finance without subsidies.

• The three-bedroom design is more compact than the typical home, but it includes all the must-have features that small families say they can’t live without.

• Modular construction was how this builder reduced construction costs. In fact, they say the home could not have been affordably stick built.

I work for a custom-building company in Pittsburgh, Pa., where it costs around $500,000 to build a typical 1,700 to 2,000 square foot house. Unfortunately, many of the potential buyers I speak with only qualify for a mortgage in the low $300s. They include couples with children who have given up on finding an appropriate home in that price range.

These people are a large potential market, so a few years ago we began thinking about how to serve them. We knew that we would have to move away from custom work to a more standardized product, but we wanted to offer options that would help buyers personalize the home, at least somewhat.

Some builders, developers and government officials seem to assume that you can only provide good homes to people of moderate means with subsidies or tax breaks, which of course means that someone else is paying part of the bill. We wanted to develop a product that would serve these buyers without the need for assistance.

The result is our Potens model (Latin for “mighty”, as in “small and mighty”). It’s a full modular home that can be sold at the $300,000 price point that average families can afford. It has just 1,270 square feet of floor space but includes all the needed amenities.
The road to this result included two hurdles. One was how to squeeze the needed features into a small floor plan. The other was how to minimize construction costs. Our solution was a blend of thoughtful design and modular construction.

Focus On the Important

Although a small home is inherently less costly to build, it can pose design challenges. Fortunately, there are plenty of examples of well-designed small homes. For the Potens, we took inspiration from the compact, space-efficient homes built during the mid-20th century. With 1,100 to 1,300 square feet of floor space, they offered clever use of space, practical layouts and undeniable charm.

Families today have different requirements than those in the 50s and 60s, but our design ticks all their boxes. Our approach was to focus on providing what people wanted, while eliminating some common features they could live without.

The home has three bedrooms and 2 1/2 baths, including a master suite with its own bath. The bedrooms are smaller than those in a typical suburban home, but in our conversations with potential buyers we heard fewer concerns about room size than about bath count.

The Potens also lacks a formal dining room, but we haven’t heard any objections to that, either. People seldom if ever use that space. At the same time, we’ve kept two spaces that are on everyone’s wish list: a mudroom and an eat-in kitchen with an island.

We didn’t try to skimp on kitchen space. In addition to young families, our target market includes older people and those with physical limitations, so we wanted the home to have as many universal design touches as possible. The kitchen is big enough that someone in a wheelchair can easily navigate around the island.

We developed a floor plan that can be manufactured easily and cost effectively. Although it’s a standard plan, we do allow some personalization. Buyers can choose different finishes, and the bedrooms can be used as children’s rooms or (as was the case with one client) an office. The home is meant to be placed on a crawlspace and includes a small utility and laundry room under the second-floor stairs, but if placed on a full foundation, the mechanicals can be moved to the basement and that room converted to a stairwell.

The floor plan can be flipped and manufactured as the mirror image of itself, depending on what the homeowners want. The monoslope shed roof can be flipped as well, so that people who want solar panels can choose the best orientation for their site. Another benefit to the mirrored plans and monoslope roof is that we can create a duplex without changing the standard specs and without altering rooflines.

When designing the home, we also knew that we would have to satisfy lenders’ needs. Most 1,200 square foot homes built today only have two bedrooms and, at least in my area, don’t appraise for the needed $300,000.

Eliminating the dining room and opting for smaller bedrooms solved the problem. We found that lenders don’t actually care about design; they just look at what other 3-bedroom homes in the area are selling for. With three bedrooms and 2 1/2 baths, Potens earns the comps we need.

Focus On the Important

Although a small home is inherently less costly to build, it can pose design challenges. Fortunately, there are plenty of examples of well-designed small homes. For the Potens, we took inspiration from the compact, space-efficient homes built during the mid-20th century. With 1,100 to 1,300 square feet of floor space, they offered clever use of space, practical layouts and undeniable charm.

Families today have different requirements than those in the 50s and 60s, but our design ticks all their boxes. Our approach was to focus on providing what people wanted, while eliminating some common features they could live without.
The home has three bedrooms and 2 1/2 baths, including a master suite with its own bath. The bedrooms are smaller than those in a typical suburban home, but in our conversations with potential buyers we heard fewer concerns about room size than about bath count.

The Potens also lacks a formal dining room, but we haven’t heard any objections to that, either. People seldom if ever use that space. At the same time, we’ve kept two spaces that are on everyone’s wish list: a mudroom and an eat-in kitchen with an island.
We didn’t try to skimp on kitchen space. In addition to young families, our target market includes older people and those with physical limitations, so we wanted the home to have as many universal design touches as possible. The kitchen is big enough that someone in a wheelchair can easily navigate around the island.

We developed a floor plan that can be manufactured easily and cost effectively. Although it’s a standard plan, we do allow some personalization. Buyers can choose different finishes, and the bedrooms can be used as children’s rooms or (as was the case with one client) an office. The home is meant to be placed on a crawlspace and includes a small utility and laundry room under the second-floor stairs, but if placed on a full foundation, the mechanicals can be moved to the basement and that room converted to a stairwell.

The floor plan can be flipped and manufactured as the mirror image of itself, depending on what the homeowners want. The monoslope shed roof can be flipped as well, so that people who want solar panels can choose the best orientation for their site. Another benefit to the mirrored plans and monoslope roof is that we can create a duplex without changing the standard specs and without altering rooflines.

When designing the home, we also knew that we would have to satisfy lenders’ needs. Most 1,200 square foot homes built today only have two bedrooms and, at least in my area, don’t appraise for the needed $300,000.

Eliminating the dining room and opting for smaller bedrooms solved the problem. We found that lenders don’t actually care about design; they just look at what other 3-bedroom homes in the area are selling for. With three bedrooms and 2 1/2 baths, Potens earns the comps we need.

Optimizing for Modular

“This is not our first modular home; we’ve been using this method of construction for several years and are completely sold on it. I am absolutely in love with the idea of modular construction because of the advantages it offers.

Our portfolio already includes 18 modular homes in Pittsburgh, including the Black Street Development, which consisted of three structures in the city’s Garfield neighborhood: an up-down duplex, and two single-family homes, one of which was sold at market rate and one that was subsidized by the Urban Redevelopment Authority. Black Street was featured in several national publications.

As a result of this experience, we have learned to design around modular parameters such as the 16-foot module width. We’ve applied all knowledge gained from our experience to Potens.

Some builders say that modular costs as much to build as stick framing, but we don’t find that to be so. Although we haven’t actually site-built a Potens, our estimates are that it would cost $50,000 to $75,000 more to build it that way, making it too expensive for the customers we want to serve.

We realized that savings, in part, by designing the home to be easily manufacturable. In fact, my advice to builders who are new to modular and who want to optimize cost savings is to work with the factory when developing floor plans. I’ve spent a lot of time talking with modular salespeople, as well as with workers on the factory floor, asking questions and listening to their answers.

These conversations helped my company realize efficiencies, such as learning how to design so that mate walls line up in ways that minimize the amount of on-site seaming. Understanding the manufacturing process also led us to choose the tiltable monoscope roof, which is easier to manufacture and less costly than a gable.

When calculating modular costs, it’s important to factor in the value of time savings. A lot of our savings was thanks to less time on-site, particularly when it came to inspections. This can vary by municipality; Pittsburgh is hyper-strict, and we might have to stop a site-built project a dozen times while waiting for various inspectors to show up. With modular, we don’t have to worry about plumbing, electrical, and the screw pattern on the drywall. (Yes, they check that here.) Those and a lot of other inspections are done in the factory.

Reducing days on-site also reduces a lot of soft costs — from porta-johns to portable power, to site safety costs, to the time spent protecting a half-finished house from the weather. You need to factor these into the final project cost to understand the true savings that modular offers.

The bottom line is that we ended up with factory costs of $115,000 and site costs of about $135,000, for a total of $250,000. With a $300,000 sale price we’re able to earn a decent profit while delivering a product that the average family can afford, with the specs needed by them and by the lenders. Everyone wins.

Our hope is that Potens will serve as a model for a new generation of compact homes. It’s a great example of what can be achieved by combining good design with the efficiencies of modular construction.

Blockhouse Residential also built the modular Black Street Development in the Garfield neighborhood of Pittsburgh. The lessons it learned on this, and other modular projects, were applied to the Potens model.

Andrew Holmes is VP of Construction at Blockhouse Residential in Pittsburgh, Pennsylvania. Images provided by the author.