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Custom vs. Prefab ADUs vs. Modular ADUs

The two most common methods of building ADUs carry pros and cons. Learn why Cottage chooses to focus on custom, stick-built ADUs over prefab ADUs or modular units for a faster, cheaper investment.

September 3, 2020

Every day, a new prefab ADU design pops up in our Instagram feed. They often seem pretty appealing, with sleek designs, short timeframes, and approachable price tags. While many homeowners start their ADU research process by looking at prefabs, savvy homeowners choose custom designs and site-built construction. Here are a few factors things homeowners should consider when deciding between custom, prefab ADUs or modular ADUs.

Breaking It Down: Key Differences Between Custom, Prefab, and Modular ADUs

You can expect to run into these terms before constructing virtually any structure. Before we get into the nitty-gritty, let’s review a few key differences between these three types of design for accessory dwelling units (ADUs). Custom, prefab, and modular ADUs all come with their limitations and strong points that are worth reviewing.

Custom ADUs

A custom ADU, also referred to as a stick-built ADU, is an ADU built using traditional construction methods.

A custom ADU is best for those with specific design ambitions. Perhaps you are looking to build a tiny home or cottage with a unique theme or an artisan style of architecture. Or, it is also possible that your property may have specific limitations therein or a unique shape or layout. Custom ADUs are ideal if you need to build a more flexible structure with a special form or other such allowances or just want to get a final ADU that fits your personalized needs.

With a custom ADU, the typical way to go about it is as such: the owner or project manager is responsible for architects, designers, contractors for construction, home builders, plumbing, electricity, painting, flooring, and every other specialized process piece. If you don’t engage a one-stop custom ADU provider like Cottage, you yourself will have to deal with a fair amount of permitting and building inspections all along the way, from design to construction.

Prefab ADUs

A prefab (or prefabricated) ADU takes a different approach. In this model, significant pieces of the structure are assembled beforehand in a factory setting. Walls, framing, ceilings, and other such structural components are designed and created, then built on-site with the help of cranes and other devices.

This is a different undertaking than a custom ADU. While it may not allow for complete freedom and flexibility in design, there are limited options to consider, modify, and choose from.

Prefab homes allow the homeowner to work with more predetermined components already specially designed. How these various components are arranged or designed is still subject to a limited amount of flexibility on the owner’s part.

Prefab ADUs are a midway option for prospective ADU homeowners looking for some design creativity without necessarily getting deep into all the technical details that come with a home, including utilities, appliances, and other permitting headaches.

Modular ADUs

On the opposite side of the real estate spectrum from stick-built ADUs, modular ADUs are by far the most efficiently produced structures, ideal for the most streamlined projects where large swaths of time are not available for design and creativity.

Modular homes are structures that are almost entirely pre-built before arriving at the property site. Sometimes, this can be a whole trailer, tiny home, or cottage brought in on a vehicle.

Installation of these ADUs is straightforward, with everything built according to safety, health, energy, and general building codes. However, the process is much less hands-on, and the owner has less creativity in design.

Are you interested in modular ADUs? Cottage can help you out with our selection of floor plans. Make the ADU construction process simpler by browsing through various pre-designed builds, including a detailed construction breakdown. These floor plans are a combination of the modular and custom approach, offering a complete structural design package similar to modular ADUs.

How much choice do I get for my ADU design?

Prefab ADUs come in a few different size options, from a compact 400 sq. ft. to the state maximum of 1,200 sq. ft. You can sometimes rotate the unit and place it anywhere on the property outside of the required setbacks, but preset windows and doors may become design limitations if they are not situated in just the right way. Some prefab offerings also have a few exterior siding options (stucco, wood siding, etc.).

With a custom ADU, you can make as many or as few design choices as you want. You’ll be able to choose the exact positioning, floor plan, size, and interior and exterior finishings. Do you want high ceilings, a vaulted ceiling, and a window exactly where you want it? No problem. Do you want your dream modern farmhouse ADU? We'll take care of that for you.

At Cottage, we believe one size doesn't fit all. Every property and every homeowner are unique, and a different ADU design should be tailored to fit.

What is faster for my ADU project?

Prefab ADU companies often claim that their ADUs can be installed in 2 weeks. Of course, that doesn’t include critical phases of every ADU project that need to be completed, whether the unit will be prefab or custom-built. Every ADU project will require city permitting, which often requires a few months to assemble the plans, submit them to the city, and have the corresponding planning and building departments review them.

Regarding construction, the ‘box’ isn’t the hard part. No matter the build type, you’ll still need contractors to take care of site work — trenching for utility tie-ins, grading the site, and installing a foundation. In our experience, that’s more than 30% of the on-site construction time, while the actual framing and finishing typically take eight to 12 weeks for our custom site-built ADUs.

Most prefab companies also require manufacturing lead time at their facilities. Manufacturing will often take two months instead of 2 weeks and often only can begin once permits are pulled from the city.

Prefab ADUs certainly have the potential to be completed more quickly. Still, with an efficiently run stick-built process like the one used for Cottage's ADUs, the difference in delivery time is negligible.

What is cheaper for my ADU budget?

Similar to car ads, prefab ADU ads advertise the ‘base price,’ but the photos include all the extras. When comparing costs, it’s essential to make an apples-to-apples comparison.

In our experience, it’s common to see the following costs conveniently left out:

  • Specialist consultants: Is that included in my price if the city requires a geotechnical report or boundary survey?
  • Do city permits include plan checks, permit costs, or impact fees?
  • Site prep: Does it include demolition and removal of your existing shed, concrete pad, or other existing site structures?
  • Foundation: Is the foundation included? Does it have a durable, long-lasting slab-on-grade, perimeter footing foundation, or just a few helical piles?
  • Installation: Does it include a crane for lifting the ADU over your home or trucking to deliver your unit from often out-of-state to the project site?
  • Finishes: What kind of appliances, flooring, doors, and windows does the “base price” include? How much is it to upgrade to what’s photographed on the website?

While custom ADUs can be expensive, you may be surprised to learn that, when accounting for all project costs, Cottage's custom ADUs frequently cost less than prefab units of the same size and finish quality.

Will a prefab ADU or modular ADU work on my property?

Most prefabs ADUs are trucked in on the back of a trailer and craned from the street or driveway. Is your driveway strong enough to handle the load of the crane and ADU, or will it crack the concrete or pavers? Do you have telephone lines or protected trees that might get in the way? Smaller backyards can also be tricky to find the right fit for the limited number of options. On the other end of the spectrum, if your ADU is too far from the street, it can sometimes be impossible to “crane” it in.

Custom, stick-built ADUs can be configured as the exact size and shape to work with your property. L-shaped or even U-shaped ADUs are common designs in limited backyard space. Construction is completed on site and doesn't rely on cranes.

Which ADU type will have a better return on investment?

Since a home is often the largest single investment a person will ever make, you should consider an ADU an investment in your home and your future. The return on investment for your ADU, both in equity and cash terms, is important.

Equity: If you need financing, how favorably will the bank appraise a prefab unit vs. actual site-built construction? If you eventually plan to sell the home, how will a buyer value it versus a custom ADU architecturally designed to fit your property?

Cash: If you plan on renting out the ADU, how easy will it be to attract and retain great tenants? How will the construction hold up to the wear and tear of renters and move-in / move-out days?

We’re big believers in the potential for innovation in construction, but we’re not yet at a point where prefab or modular is worth the trade-offs. Are you interested in more space for you and your loved ones with an accessory dwelling unit? Contact us today using the link below for a free, no-obligation consultation & estimate with one of our ADU experts!