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Housing board outlines gains and limits of modular and mobile‑home strategies; financing and scale are central hurdles
Summary
The Vermont Housing and Conservation Board told the House committee that panelized and modular construction are being used more widely and can lower on-site costs, but officials cautioned that scalability, market demand and financing terms determine whether factories and bulk orders will reduce prices enough to expand affordable supply.
At a Feb. 6 House Committee on General and Housing hearing, Gus Silo of the Vermont Housing and Conservation Board described the state’s recent experience with panelized construction, modular homes and mobile‑home park interventions, and urged careful planning when using factory-built housing to expand supply.
“What panelized construction means is you're getting panels and walls essentially delivered on-site rather than having to construct them on-site,” Silo told the committee, describing panelization as a way to speed production. The board said 32 post‑2020 projects involving roughly 900 apartments have used panelized construction, and developers estimate savings of about $5 to $7 per square foot in many projects.
Silo reviewed past Vermont efforts to support factory-built homes after Tropical Storm Irene, when foundations and philanthropic partners subsidized early modular production and infill. He said production scale matters: a Hartford, Vt., factory initially produced roughly one house per week; other suppliers in the region now produce at higher rates and lower per-unit costs.
Costs and market limits: Witnesses told the committee many factory-built homes still sell at price points well above what lower‑income buyers can afford. Silo said some modular and manufacturer homes with solar can be delivered for “all in” prices around $150,000 in certain products, but many new modular developments reported by the committee had market-rate units at higher price points. The committee also discussed a recent example in which Huntington Homes‑built units in a Middlebury project required subsidies for some units; market units were described in testimony as being in the mid‑$500,000s to $600,000s range.
Financing and tenure: Committee members asked about loan terms and whether mobile or modular homes get better bank rates. Silo said modular homes on owned land generally secure better financing; he described a credit union program willing to offer a fixed 7% loan with a 20‑year term and warned of higher‑cost lenders charging double‑digit rates. He also described USDA financing options for mobile homes where a longer land lease (for example, 33 years) is possible and said nonprofit ownership models can support longer leases and lower financing costs.
Mobile‑home parks and public investment: Silo said infill in parks can preserve existing residents’ housing but cautioned that major public investment in a privately owned park increases the park’s cash flow and potential sale price. Under current Vermont law, residents typically have a right of first refusal on park sales; Silo urged planners to consider negotiated shared‑equity arrangements or discounts on sale prices when a large public investment has increased owner value.
Ending: Silo said the state and its partners will continue to pursue panelized and modular methods where scale and market conditions make sense, while recommending market studies, careful financing design and shared‑equity protections in park investments to protect residents.
