Buying land for a prefab modular home?

Has anyone purchased land and put a prefab /modular home on it? We're contemplating moving further out in order to afford a home. Is it crazy to buy some "cheap" land and build a house? Is it possible to build a home for under $400k (not including land)?  Where did you start? Any modular home company recs? Contractor recs? Do they walk you through the cost process to make sure you're actually going to be able to afford it? Is there a company that walks you through the process? What type of land to buy, surveys, permitting, etc?  Trying to figure out if we're crazy (or just desperate) for considering it. 


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My husband and I bought land a few years ago. We've not yet built on it. Our next-door neighbors' house (architect-designed mod two bedroom, one bath, 1000 square foot prefab) was nearly $500,000 to build, not including the land, but including site costs and everything else. Rural parcel with a (slightly sloped) building pad, entry road, and well already in place. My guesstimate is that you can get a nice turnkey prefab modular home--just the module--in N California, created by a Dwell-magazine type prefab builder (Living Homes, Alchemy Architects), built for around $200 a square foot.

Things that get tricky to put a price on are the costs specific to your site. Land that is "cheap" might be low-priced for a reason--it may be a difficult parcel to build upon. Are you looking for remote land, or an empty parcel in a town? Just a slight few of very many issues my husband and I have encountered when we bought remote-ish land near Ukiah: 

Waste. Are you going to have a septic system? Is the land approved for it? Does the land have a permit for septic in place? Will it be an easy system to install, or difficult? Or do you have access to county sewage? How much is that hookup?

Electricity: Our HOA doesn't allow above-ground power lines, only buried ones. Land might be sold as having PG&E being available on the property, but the box that brings PG&E to your parcel might be very far from where you are going to set your house. It can be expensive to install. Our quote was $30,000. Solar-only for our neighbor cost about the same.

Water: County water? Or is there a well? Trying to locate water and then drilling a deep well can be very expensive. Don't buy land without being absolutely sure there's water on it. 

Building site: Is it a level and clear building pad? Or is it on a slope and littered with boulders? Is there a driveway? Is there a road to the parcel? Who maintains it? Is the parcel fenced and/or gated? How is the drainage around your building site--will you have to move dirt around, cut culverts and drains?

Modular delivery: How far are you from the manufacturer (delivery is charged by the mile)? How much will the crane to set the unit in place cost? Are there any hairpin turns up to your building pad that might make your module difficult to deliver?

Financing: It seems difficult to get bank financing for land. We were able to get the seller to carry the loan after giving a large down payment. Also, getting a construction loan might be rough. Many banks don't give loans to build because if the contractor flakes, the bank is left with an unfinished house. You might be best served by a builder who will also offer you a loan to buy the land and build, or build on land you own, if you use her/him.

These are only a few possible issues to consider. 

If we had the chance to buy land again, we would probably look for a parcel that could be subdivided. Some of our neighbors bought this sort of parcel, waited a few years, then sold the lesser parcel and used the money to partly fund the building of their house. It's risky, of course. Even nice land can sit on the market for a long time before finding a buyer. 

You might want to look for land that has a house on it already. Then, add to and/or improve the house that is in place. 

Hope this is a little bit helpful!