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Inspired by the Sears, Roebuck mail-order homes that sprang up in the early 1900s, "designer prefab" spans a number of highly nuanced--and often confounding--housing categories. Variously described as systems-built, modular, panelized, kit or manufactured, prefab homes are constructed at least partially in factories before being transported to building sites. There they can be assembled quickly, sometimes in a matter of days. While most of the new-age houses in a box have yet to be mass-produced, an expected rise in interest rates and a public hungry to meld good design with low cost will make them an attractive alternative, says Charles Bevier, editor of Building Systems magazine, a trade publication. The Freedonia Group, an industrial market-research firm, expects the size of the prefabricated-housing market, which includes panelized, manufactured, modular and precut, to rise to roughly $11.8 billion by 2007, up from $9.5 billion in 2003. (And, yes, that includes trailers and double-wides.) Interest is already beginning to grow--among both consumers and investors. Rocio Romero, 32, an architect from Perryville, Mo., has sold five of her Laguna Verde (LV) kit houses, which are priced at $31,050. Andrew Reid, a sales manager for Countrywide Home Loans in Woodinville and Chelan, Wash., says he has been swamped with inquiries since Kaufmann's Glidehouse was featured in Sunset magazine. "I had several hundred calls from potential buyers," he says.
Another kind of buyer is financier Warren Buffett, who has planted a cornerstone in the market. Last year Buffett's company, Berkshire Hathaway, spent about $1.7 billion to acquire Clayton Homes, a manufactured-housing company in Tennessee that had sales of $1.2 billion in 2003. This year Clayton, in turn, spent $373 million to acquire Oakwood Homes, which offers a mix of modular and more traditionally manufactured homes. The lower end of the prefab industry is recovering after a wave of defaults resulting from overzealous lending. With interest rates climbing, more customers may now opt for relatively inexpensive manufactured homes. Recently, the damage caused by Hurricane Charley boosted stocks of companies that specialize in manufactured homes.
Except for some modified post-and-beam-style cottages by Cutler and Graves, the architects' houses are not for traditionalists. They're mostly modern structures built with large quantities of glass, steel and environmentally sustainable materials. Kaufmann calls the Glidehouse project an effort to "collaborate with nature." Instead of hardwood floors that stress first-growth forests, she uses fast-growing bamboo. Lighting from the structure's glassy exterior, plus solar panels and a wind generator, reduces electricity use. "It's the housing equivalent of the Prius," says Kaufmann, referring to Toyota's environmentally conscious car. "Clean and green."