What Is a Modular Home, and How Is It Different from a Mobile Home or Prefab Home?

If you’ve been researching affordable, fast, and energy-efficient housing, you’ve probably come across the terms modular home, mobile home, and prefab home. While they sound similar, these housing types have significant differences in construction, regulations, and long-term value.

In this guide, we’ll explain exactly what a modular home is and how it compares to the others — so you can make an informed choice for your next home.

What Is a Modular Home?

A modular home is a permanent residential building constructed in sections (modules) inside a factory. These modules are transported to the building site and assembled on a permanent foundation.

Key features of modular homes:

• Built to the same local building codes as traditional site-built houses.

• Can be custom-designed in layout, size, and finishes.

• Typically built faster than conventional homes (often within 2–4 months).

• Energy-efficient and suitable for year-round living.

Modular Home vs. Mobile Home

Although the names sound alike, they are very different housing types:

Construction & Building Codes

• Modular Home: Built to local/state building codes (e.g., International Residential Code in the U.S., Eurocodes in Europe).

• Mobile Home: Built according to a federal or national HUD code (U.S.) or similar light structure standards elsewhere.

Foundation

• Modular Home: Installed on a permanent foundation (concrete slab, crawl space, or basement).

• Mobile Home: Usually placed on steel chassis with wheels and can be moved.

Longevity & Value

• Modular Home: Appreciates in value like a site-built house.

• Mobile Home: Often depreciates over time.

Modular Home vs. Prefab Home

The term prefab home (prefabricated home) is a broader category that includes:

• Modular homes (built in modules).

• Panelized homes (built in wall panels).

• Mobile homes (factory-built on chassis).

Key difference: All modular homes are prefab, but not all prefab homes are modular.

Advantages of Choosing a Modular Home

• Faster construction time (factory work + quick on-site assembly).

• Higher energy efficiency thanks to precise manufacturing and insulation.

• Customizable design to fit lifestyle and budget.

• Durability equal to or greater than traditional homes.

• Eco-friendly construction with less waste.

Which One Is Right for You?

If you’re looking for a permanent, long-lasting, and customizable home that meets building codes and appreciates in value, a modular home is the best choice.If portability is your priority and you need a low-cost temporary dwelling, a mobile home might work.If you want variety in construction methods, the prefab home category offers multiple options.