Build a House or Buy a Trailer: What's Better?

If you're looking to get out of renting, building your own house or buying a trailer are two options that are more affordable than buying a house. There's a lot of variables to consider when weighing the two options.

You can build an inexpensive, modest home, and keep costs down by doing the work yourself. You can also sourcing out cheap (or free) materials—but that's not everyone's idea of a "dream home".

Custom builds will generally cost more, but can be worth it if you have a particular design in mind. They usually cost less than buying a house outright, depending on some factors.

Not all trailers are the same, either, with prices ranging from a couple grand for a complete fixer-upper to a couple hundred grand for a larger, newer model with all the bells and whistles.

Trailers are also mobile and can be set up in different areas, meaning you don't necessarily have to buy land. Mobile homes are similar to trailers, and allow for permanent applications on either leased or owned land.

We'll take a deeper look into all of these considerations to help you decide whether it's better to build a house or buy a trailer.

Budget

The main consideration between building your own home or buying a trailer is your budget. If money is no object, then you can build your dream home without any worries, and the case is closed!

For most people, considering the two options is because money IS of concern, and you want to get the best bang for your buck when starting out.

Land, lumber and building supplies, labor, and single-detached home prices are all getting more expensive, which is why it can be tempting to look at trailers and trailer campgrounds that are already set-up.

This leads to the second most important consideration: will you be looking to purchase land, or do you already have a spot to build, or set a trailer on?

Other things come down to personal choice: do you want the flexibility of being able to move your home around? Do you plan to live on or off-grid? Are there certain amenities you can't live without?

Tiny homes built on wheels, or trailers allow you to move your home to different locations. For some people this is very important, for others, they want a permanent place to put down roots.

Cost Per Square Foot

Most new mobile homes cost $50-100 per square foot, in comparison to $200-400sqft for a typical 2000 sqft house. A 24-foot travel trailer with 720 sqft starts new for around $40,000, which is $56/ sqft.

Trailers will be cheaper than homes per square foot, even if you do your own building, but do the math when comparing your options, as these are very general estimations. Divide the total purchasing or building estimate price by the square footage to see what you're getting.

Sometimes mobile homes may have a "worse" cost per square foot, but you're getting an overall cheaper, affordable price.

For example, a 500 sqft newer, upgraded mobile home in a decent park may cost around $150,000, which puts the cost per square foot relatively high at $300/ sqft—but good luck finding or even building a home at that price point.

Choosing a smaller home around 1260 sqft with two bedrooms and one bathroom on a slab foundation is one of the cheaper options when building your own home. It can also be much easier to do your own contracting on a smaller project like this.

A custom home build that doubles the size at 2800 square foot with modern finishes and design will cost on average $420,000 to build (including cost of land and land clearing), which is $150/ sqft.

Consider adding more outdoor living space like a covered porch or deck area to get the feeling of more space without paying as much as interior costs.

Market Considerations

Doing "comps" will help you set a realistic goal of how much to spend on your custom build in a certain area. Real estate agents can help you with this, or you can do your own market research.

This doesn't apply to mobile homes and trailers, as much, but there are different market considerations like comparing trailer models, visiting different lots or parks, and choosing between buying new or used.

Pros of Custom Building

The major pro of custom building is you get exactly what you want...mostly. Most people don't realize that their vision doesn't always come to complete fruition, but it will get close.

As mentioned, problems will arise, forcing you to make some tough or different decisions, however, you're still the one in control.

If you don't mind making decisions, and can work side by side with a contractor, then you'll end up with a home custom built exactly for you.

This means you can choose the finishes in your kitchen, how big your bedroom closet is, and even put an en-suite bathroom in. Working with a licensed contractor can help you get the "must-have" items while compromising on some other, lesser important aspects.

You can also choose to build greener with energy-efficient appliances and HVAC systems, and even add solar or off-grid living options if that interests you.

These things are much harder to retrofit into an existing home, and more cost-effective to add to plans before you build.

Unforeseen Costs

Time-frame

One of the other hard truths about custom home building is that these projects almost always go over the time expected. A good rule of thumb is to allow for extra costs as well as time for custom builds.

The weather is a main factor, so if you live in moderate climates, this may have less of an impact. Snow and rain cause the most delays in home construction, but wind and extreme heat can also cause slowdowns.

Most custom builders are also booked up and it may take you six months to a year to find someone to take on the job. If you're set on custom building, start this process well ahead of time.

Once you have a contractor and builder in place, getting plans ready can take a few months to get approved. After that, expect building to take anywhere from three months to a year depending on your climate, site considerations, proper scheduling of all the trades, and ease of design.

Pros of DIY Building

You can reduce the costs of building your own home substantially if you do some or all of the work yourself, or scale back on some amenities and finishes.

There's no one-price-fits-all, as every build depends on location, climate, and design. Just like with custom building, choosing a smaller, minimalist design will keep costs (and headaches) down.

You still need to secure financing for your project, purchase land (if applicable), and get plans and permits approved. If you're willing and able to be your own contractor that oversees these aspects, you can save thousands.

If you're relatively handy, or willing to learn, consider certain jobs that amateur DIY-ers can tackle like grunt work, basic framing, laying floors, and painting.

Hiring out for excavation, foundation pours, and drywall are recommended. You should always hire licensed electricians, plumbers, and HVAC technicians, although you may be able to help with the labor.

Purchasing Land

This is something you have to think about whether you're going to build your own home or buy a trailer, unless you already have land to use.

The cost of land varies significantly from location to another, and not just in different states, but your own municipality will have different lots available.

If you're buying undeveloped land, this adds to the cost as there's lot preparation and due diligence, surveys, and sometimes even soil tests that might need to be done.

Work with a real estate closely who understands the ins and outs of buying undeveloped land. They'll be your best resource, as will municipal records of previous owners, or environmental issues of the past.

Land grading and excavation are usually needed for larger projects, but if you're building a smaller DIY cabin type home, you may be able to clear the area yourself.

Choose a smaller, narrow, level lot to cut down on costs. Smaller parcels will generally be cheaper than larger ones, but of course this depends on the market you're buying in.

If you can work anywhere, consider buying land that's still cheap at the moment but has the potential for growth.

Mobile Homes/ Trailers

Trailers and mobile homes are often considered the same thing, and while they're very similar, they can serve different purposes. A trailer is generally smaller, meaning less living space, and better suited for traveling around in or towing behind a vehicle.

A mobile home is also known as a manufactured home and generally includes more square footage, regular amenities, and is placed on a permanent foundation. While both offer similar options for recreational or vacation use, they can also be alternatives to living in a typical residential house.

Trailers offer more flexibility in terms of where they get placed. It can be a great option if you want to try out different locations before buying land. They also allow for a digital nomad lifestyle that allows you to travel and work at the same time.

Mobile homes are factory-built and can be placed on leased or owned land. This means there will be costs included with either land ownership, or association and rental fees.

You can place either on a piece of owned land, in which case you're subject to all of the same costs that come with purchasing land for building your own home.

The permits may be different, but you'll still need to do your due diligence whether the land allows for mobile homes or trailers.

Pros of Buying a Trailer

The biggest pro is that trailers or mobile homes are generally more cost-effective than stick-built homes. Whether you own land or have to lease a lot, the overall cost of owning or financing a trailer versus a mortgage is much cheaper.

Trailers and mobile homes are ready to move into. You won't have to wait around for a house to be built or deal with the headaches involved in building a house if you get a trailer—unless you're custom ordering one.

The trailer market has skyrocketed in popularity, as people are looking for different ways to live and work, so the options for a custom-made, decked out trailer are vast.

Check out companies like Escape which make tiny home trailers that a lot of people are choosing to live in full-time.

Their basic model called the Traveler starts just under $80,000 and includes what they call a "drool-worthy kitchen", panoramic windows, modern interior, and a decent sized bedroom.

Cons of Buying a Trailer

Trailers, like cars, depreciate the second you drive them off the lot, unlike home ownership where you generally gain in equity and can bank on it being a good investment.

There's a better chance at a well-maintained mobile home appreciating in value, but there's not as much expected or guarantee as a typical residential home. This is another instance where market analysis will help you decide if it's a solid long-term investment.

While there may not be as much maintenance as with a home, trailers and mobile homes still need regular servicing, and some of it isn't always second nature.

You'll need to figure out how to power them (propane, solar, on-grid, off-grid), how to take care of the foundation, and prevent any environmental wear and tear.

If your trailer is being taken on the road, on-going regular vehicle maintenance just like a car is essential, especially the more you drive it—not to mention the cost of gas.

FAQ

What are the advantages of building a new home?

How much can I save if I general contract my own home build?

You can save around 20 percent of overall costs if you act as your own general contractor, however professional GC's have their own network of subcontractors they can coordinate in sequence of the permit approval. They may also have wholesale discounts and tips on how to save on materials.

Is it cheaper to build a house or buy a trailer?

Buying a trailer is usually cheaper than building a house. You may be able to find a used trailer for under $10,000, but it will likely need some upgrades. It's difficult to build a house for that amount, but doing the work yourself and sourcing free materials can keep costs down on a modest build.