‘You wouldn’t tell someone they have to build their vehicle in their driveway’
As housing prices continue to rise in Wisconsin, driven in part by the cost of construction, could prefabricated houses emerge as a potential cost-saving measure?
Yes, say those in the industry.
“Our houses run probably about 25 percent to 40 percent less than a stick-built home,” said Amy Bliss, executive director of Wisconsin Housing Alliance, an association representing the “factory-built housing” industry. Its members include makers of “modular” homes, built in sections at a factory then transported to a building site for assembly. They also include makers of “manufactured” houses, built as a complete unit ready to install on a site.
In such options, everything from lumber to appliances to lighting is bought in bulk by manufacturers, allowing for a lower price point compared to traditional homes.
“We use the same exact lumber and the same exact shingles and the same exact type of siding,” said Bliss. “It’s just because our industry specializes in economies of scale.”
A lower-cost option would help. Houses have grown expensive relative to incomes in Wisconsin. Last year, it took a $108,000 household income to afford to buy a median home in metro Madison and $89,000 in the Appleton area.
The situation has led renting to suffer as well. Milwaukee was recognized as being among some of the most competitive rental markets in the country in 2025.
Prefabricated houses have long played some role in Wisconsin’s housing market. Manufactured housing accounts for about 1,400 homes built in the state per year, or roughly 2.5 percent, according to the alliance. This makes the Badger State 26th in the country for manufactured home installation behind states like Texas, Florida and North Carolina.
While this percentage remains relatively stable, the alliance predicts the number of homes built may see an uptick as the demand for affordable housing increases.
Making manufactured houses matters in Wisconsin, too: The alliance reports the prefabricated housing industry adds $2.5 billion to the state’s economy annually, creating 22,064 jobs and paying out $881 million in wages.
But just as other aspects of housing are entangled with regulatory issues, so prefabricated houses run into such headwinds.
Andrew Justus, housing policy analyst with a market-oriented think tank, Niskanen Center, said that despite the similarity of prefabricated houses to site-built ones, many jurisdictions nationally govern them by the same laws used for what used to be called “mobile homes,” which are wheeled and in theory could be moved. This can make it difficult to secure approval for a new prefabricated housing development.
“A locality can say, ‘No manufactured homes in this zone,’ but then there are more subtle exclusions, things like ‘must have a certain roof pitch or above,’ because traditionally manufactured homes had a very shallow roof pitch,” Justus said.
Because of this, Justus said prefabricated houses are on unequal regulatory footing compared to traditionally built homes. He said equalizing the two could allow for a more competitive market among homebuilders.
Bliss cited similar concerns in Wisconsin.
“I think what holds the industry back are negative stereotypes of the past,” she said. “They’re great starter homes; they’d be great for downsizing.”
Bliss said that in her experience, many older generations have perceptions of manufactured homes as being akin to trailers that can be hauled with a truck. Many older versions of manufactured houses also lacked common building materials, like drywall, further exacerbating these perceptions.
Bliss said those stereotypes led to regulations, often on siting manufactured houses. These were passed by an older generation of municipal leadership that is now slowly going away.
“The most common rules are ones that say ‘mobile or manufactured’ homes can only be placed in a ‘mobile home park,’” Bliss said. She said the industry would prefer that, if a house fits the aesthetics of a neighborhood, it should be allowed.
Bliss said the industry just wants an equal regulatory footing with other homebuilders to allow homebuyers to pick the option they prefer.
“We are not asking for subsidy or special treatment. We are just looking to be treated on par with site-built homes,” Bliss said. “You wouldn’t tell someone they have to build their vehicle in their driveway and that’s kind of the same premise.”
“Not everybody can afford a half-a-million-dollar house, but if you bring that down to $300,000 or $250,000, they very well could become homeowners,” she added.
One place manufactured houses are finding a place is in dementia villages, which help patients with the degenerative disease live with their spouses or loved ones in a controlled environment that offers common conveniences like grocery stores, spas and theaters. The state already has two such facilities in Fitchburg and Sheboygan.
The Livasu dementia village facility in Sheboygan took advantage of prefabrication to offer small homes customized to care for the needs of elderly residents. Bedrooms have a direct line of sight to bathrooms to prevent incontinence and the colors of doors and walls are chosen to assist those with poor eyesight, according to news reports.
The homes cost between $95,000 and $175,000, compared to the $125,000 cost of a single room in an elderly care facility. They have customized features meant to help people with dementia — more lights, contrasting-color door handles, for instance.
Bliss pointed out that manufactured houses are customizable. Everything from the room configurations to the colors of shingles and siding can be made to fit the particular requirements of the cities where prefabricated homes will be installed.
“You would never know if someone didn’t tell you that some were manufactured homes,” she said.
Justus echoed that. “Looking at the houses, you wouldn’t necessarily know which ones were built on site and which ones were towed there and placed on a foundation,” he said.
One opportunity for regulatory relief comes from the provision in the bipartisan housing bill Congress passed last summer: A provision removed the federal requirement that all manufactured houses include a permanent steel chassis.
A chassis, a metal structure built into the base of a manufactured home, allows it to be carried via truck. The requirement added as much as $10,000 in costs and led such houses to be regulatorily conflated with old-style mobile homes, limiting access to financing.
Because Wisconsin incorporates the federal definition of manufactured homes in its housing regulations, Justus said, the foundation is laid for the widespread adoption of manufactured housing here.
“States should ensure that they and their localities treat manufactured homes on equal terms to site-built homes,” he said. “The first step in that process is addressing any zoning rules that exclude manufactured homes.”
Jackson Walker is a native Wisconsinite and a Michigan-based journalist.
Any use or reproduction of Badger Institute articles or photographs requires prior written permission. To request permission to post articles on a website or print copies for distribution, contact Badger Institute Marketing Director Matt Erdman at matt@badgerinstitute.org.
