Prefab Rehab

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n Becky LaChance and Jarrett Rice move into their new home in Benbrook, Texas, this fall, it will look like no other house on the block. Designed by renowned architect Michael Graves, who is also known as the creator of teakettles and toilet brushes for Target, it will feature a bold, angled roof, dormer windows and a country-cottage feel reminiscent of 19th century architect Andrew Jackson Downing. Aside from its traditional style, there are several major differences between this and other Graves homes. Designed as a "kit house," it was crafted in a factory owned by Seattle-based Lindal Cedar Homes and shipped to its destination on a truck. Unlike typical Graves houses, which can easily cost $1 million, LaChance and Rice's 2,000-sq.ft. prefabricated abode will be completed for well under $300,000, including the land. "We didn't have a clue what a kit house was when we first heard the news," says LaChance, who won the prototype home in a sweepstakes promotion for Target's bridal registry. "But when we found out it was designed by Michael Graves, we were blown away."

Forget boxes on wheels and tacky subdivisions. Prefab is now just plain fab. Once the poor stepchild of residential construction, so-called systems-built housing is now the province of topflight architects, who are reinventing the genre with innovative designs, new building components and environmentally friendly approaches. In September, Lindal (2003 sales: $50 million) begins offering two versions of the Graves-designed kit house on its website, where it already sells a prefab home created by James Cutler, the architect behind the home of Microsoft chairman Bill Gates. New Jersey architect-cum-performance artist Adam Kalkin is taking orders for his 2,000-sq.-ft. Quik House kit made from steel and shipping containers and priced as low as $76,000, not including land. And Frank Gehry protege Michelle Kaufmann recently debuted Glidehouse, a moderately priced modular home (averaging 1,350 sq. ft.), so named for a series of sliding panels that hide storage spaces and regulate light and airflow. Although prefabs account for less than 30% of new home construction, they are ushering in affordability with style. "Prefab is making good design available to the masses," says Jill Herbers, author of the book Prefab Modern, "and as more people discover it as an option, it will become a competitive force in the marketplace."

Inspired by the Sears, Roebuck mail-order homes that sprang up in the early 1900s, "designer prefab" spans a number of highly nuanced — and often confounding — housing categories. Variously described as systems-built, modular, panelized, kit or manufactured, prefab homes are constructed at least partially in factories before being transported to building sites. There they can be assembled quickly, sometimes in a matter of days. While most of the new-age houses in a box have yet to be mass-produced, an expected rise in interest rates and a public hungry to meld good design with low cost will make them an attractive alternative, says Charles Bevier, editor of Building Systems magazine, a trade publication. The Freedonia Group, an industrial market-research firm, expects the size of the prefabricated-housing market, which includes panelized, manufactured, modular and precut, to rise to roughly $11.8 billion by 2007, up from $9.5 billion in 2003. (And, yes, that includes trailers and double-wides.) Interest is already beginning to grow — among both consumers and investors. Rocio Romero, 32, an architect from Perryville, Mo., has sold five of her Laguna Verde (LV) kit houses, which are priced at $31,050. Andrew Reid, a sales manager for Countrywide Home Loans in Woodinville and Chelan, Wash., says he has been swamped with inquiries since Kaufmann's Glidehouse was featured in Sunset magazine. "I had several hundred calls from potential buyers," he says.