B4-1.4-02, Factory-Built Housing: Modular, Prefabricated, Panelized, or Sectional Housing (10/06/2021)

Modular homes must be built under the International Residential Code (IRC) that is administered by the state agency that is responsible for adopting and administering building code requirements for the state in which the modular home is installed. Prefabricated, panelized, or sectional housing does not have to satisfy either HUD’s Federal Manufactured Home Construction and Safety Standards or the IRC that are adopted and administered by the state in which the home is installed. The home must conform to local building codes in the area in which it will be installed.

For modular, prefabricated, panelized, or sectional housing eligibility requirements, see B2-3-02, Special Property Eligibility and Underwriting Considerations: Factory-Built HousingB2-3-02, Special Property Eligibility and Underwriting Considerations: Factory-Built Housing.

Fannie Mae does not have minimum requirements for width, size, roof pitch, or any other specific construction detail for modular homes, or any other types of factory-built homes. Because quality can account for large differences in the values of factory-built homes, it is important for the appraiser to become familiar with the features that affect the quality of a factory-built home so that the information can be included in the appraisal report if needed to support their opinion of value.

The process of selecting comparable sales for factory-built housing is generally the same as that for selecting comparable sales for site-built housing. Fannie Mae requires the appraiser to address both the marketability and comparability of modular homes and other types of factory-built housing. When the subject property is modular, prefabricated, panelized, or sectional housing, it is not required that one or more of the comparable sales be the same type of factory-built housing, although using comparable sales of similar types of homes generally enhances the reliability of the appraiser's opinion of value. Fannie Mae requires the appraiser to include in the appraisal report the most appropriate comparable sales data to support their opinion of value for the subject property. See B4-1.3-08, Comparable SalesB4-1.3-08, Comparable Sales, for general requirements regarding comparable selection.