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Here’s a tour of the modular we saw assembled back in February.  While many may have a concern about the quality of construction, it will be compounded by the noise and somewhat uncommon look inside:

Hat tip to clearfund for sending this along – isn’t it just a matter of time before we’ll see these here being used for low-income and/or senior housing?

It seems difficult to overstate the versatility of the humble shipping container. Just recently we’ve seen it used to create a pop-up shopping mall and a touring kitchen; past sightings have included restaurants, pop-up health clinics, and hotel rooms.

The latest spotting? Citihub Mandaluyong, a dormitory in the Philippines that’s built from shipping containers and designed for low-income workers and students.

The brainchild of Manila’s Arcya Commercial Corporation, Citihub Mandaluyong is situated on a stretch of land in Mandaluyong along the Pasig River, according to a report on the Manila Bulletin. Four shipping containers make up the dorm, which includes separate air-conditioned housing and bathrooms for men and women. Pricing is just PHP 1,500 per month including water and electricity. (about $35US)

Besides fulfilling what’s clearly a pressing unmet need, Citihub Mandaluyong is also a perfect example of what our sister site would call a functionall offering — one that’s simple, inexpensive and designed primarily with low-income consumers in mind. It also seems ripe with global potential; one to emulate in your neck of the woods?

https://www.facebook.com/profile.php?id=100002315624289

The youtube tour of the other modular home recently erected in Carlsbad:

Hat tip to Clearfund for sending this along, from Forbes.com:

Last weekend after Berkshire Hathaway released Warren Buffett’s annual letter, there were a flurry of  articles and blog posts hanging off Warren’s every word.  One part of his long letter that didn’t get a huge amount of ink was the section on Clayton homes, a big manufactured home company that Berkshire owns.

Here is Buffett’s excerpt on Clayton Homes:

At Clayton, we produced 23,343 homes, 47% of the industry’s total of 50,046. Contrast this to the peak year of 1998, when 372,843 homes were manufactured. (We then had an industry share of 8%.) Sales would have been terrible last year under any circumstances, but the financing problems I commented upon in the 2009 report continue to exacerbate the distress.

To explain: Home-financing policies of our government, expressed through the loans found acceptable by FHA, Freddie Mac and Fannie Mae, favor site-built homes and work to negate the price advantage that manufactured homes offer.

We finance more manufactured-home buyers than any other company. Our experience, therefore, should be instructive to those parties preparing to overhaul our country’s home-loan practices. Let’s take a look.

Clayton owns 200,804 mortgages that it originated. (It also has some mortgage portfolios that it purchased.) At the origination of these contracts, the average FICO score of our borrowers was 648, and 47% were 640 or below. Your banker will tell you that people with such scores are generally regarded as questionable credits.

Nevertheless, our portfolio has performed well during conditions of stress. Here’s our loss experience during the last five years for originated loans:

Year Net Losses as a Percentage of Average Loans
2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.53%
2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.27%
2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.17%
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.86%
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.72%

Our borrowers get in trouble when they lose their jobs, have health problems, get divorced, etc. The recession has hit them hard. But they want to stay in their homes, and generally they borrowed sensible amounts in relation to their income. In addition, we were keeping the originated mortgages for our own account, which means we were not securitizing or otherwise reselling them. If we were stupid in our lending, we were going to pay the price. That concentrates the mind.

If home buyers throughout the country had behaved like our buyers, America would not have had the crisis that it did. Our approach was simply to get a meaningful down-payment and gear fixed monthly payments to a sensible percentage of income. This policy kept Clayton solvent and also kept buyers in their homes.

Home ownership makes sense for most Americans, particularly at today’s lower prices and bargain interest rates. All things considered, the third best investment I ever made was the purchase of my home, though I would have made far more money had I instead rented and used the purchase money to buy stocks. (The two best investments were wedding rings.) For the $31,500 I paid for our house, my family and I gained 52 years of terrific memories with more to come.

But a house can be a nightmare if the buyer’s eyes are bigger than his wallet and if a lender – often protected by a government guarantee – facilitates his fantasy. Our country’s social goal should not be to put families into the house of their dreams, but rather to put them into a house they can afford.

http://www.claytonhomes.com/our_homes.cfm

How do you price a modular?

Are they nice enough that they deserve a new-house premium, or should there be a discount for being “not-stick-built”.  I think the price that buyers would be willing to pay depends mostly on what’s happening around the immediate neighborhood – here’s a tour around the one on Magnolia:

Earkier today this was a vacant lot…..

Angie said that the module installation will be complete by Friday, but it’ll take a couple of months to button it up (plumbing, electrical, and all finishing touches):

We’ve been following the modular/manufactured home idea, wondering if they will get to the point that they’ll look the same as a stick-built house.  Here’s the latest:

Hat tip to Natalie for the text-alert on the crane showing up today!