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Competition is also tough. On large development projects with more than 400 units, a sharp local builder of traditional homes can offer houses that look less boxy than the modular kind at close to the average modular price of $22,500. One reason: traditional builders in cold climates can, in effect, hibernate through the winter, in contrast to modular-home builders, who must pay the cost of maintaining a factory and a corps of trained workers. Though modular buildings are often a good buy for the money, they have yet to gain wide enough acceptance from the public, which still remembers the shoddy prefabricated houses of the post-World War II period.
Despite its current travail, modular housing still has great potential. Its advocates commonly say that the housing industry today is in the same state as the auto business in the early 1900s: it is painstakingly building handcrafted products at inflated prices. The other part of the analogy is that no Henry Ford of housing has yet appeared to show conclusively the benefits of assembly-line production at a moderate price.