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Shipping Containers are a Unique Alternative to Traditional Residences

When you think of alternative investments in real estate, you might not think of changing the building materials or the physical framework of the property. Maybe you should. Container homes, built from cargo shipping containers, are altering the way people think about and visualize new homes.

Upcycling materials in the building and rehabbing industry is nothing new. In 2012, housely.com estimated there were at least 5.5 million 160-square-foot shipping containers sitting idle after their initial use, so there has long been a plethora of available material to work with.

Today, shipping container residences are moving into the mainstream prefabricated and modular home space thanks to their availability, affordability, and nearly limitless potential for creative building and construction.


Modular Building: a sectional, prefabricated (prefab)structure consisting of multiple sections call modules. Modules are constructed offsite and delivered to the site of use for completion and assembly, and may be placed side-by-side, end-to-end, or stacked.


Can’t Contain the Possibilities

Shipping containers made their debut in the 1950s, and the first patent for a container home was obtained by Philip C. Clark in 1987. His structure was patented as “a method of converting one or more steel shipping containers into a habitable building.” Clark’s patent was actually for a shipping-container-based weight-bearing foundation that would support a habitable structure, but he noted that shipping containers would make for an “ideal modular building material.”

The container home went from fad to movement over the next 20 years. Today, the containers are used for purposes ranging from grow houses, where marijuana is cultivated, to swimming pools, tiny homes, housing for the homeless, and affordable housing.

“In the next 10 years, we see the container home industry growing because of their high quality and lower costs,” said Michael Swinton, co-founder of Millennium Home Design, an environmentally-friendly container home company.

“More importantly the eco friendliness of container homes is a major bonus,” he added. Swinton’s company currently partners with Habitat for Humanity in Illinois to co-develop container-home subdivisions. “The container-home industry has so many options for growth,” he said. “It is limited only by your imagination!”

Functionality and Beauty in One Container

Shipping containers are shaped similarly to Lego blocks, making them relatively simple to stack. After all, in their first life they are stacked, lined up, and attached in a variety of ways for the trek across oceans and countries. Once repurposed, the shipping containers can be used to create a wide array of structures.

One popular use for containers is providing shelter for the homeless. Another involves using modified containers to create prefabricated (prefab) homes. Some investors and homeowners even use shipping containers to quickly expand living space, placing them where a home expansion was planned for faster, cheaper project. Schools also use them as extra classrooms, and they are nearly commonplace in modern neighborhoods where their boxy appearance fits right in.

Cost & Comparisons

Ready to buy your first container home? Shipping containers themselves may cost between $1,000 and $5,000 before factoring in shipping. Remember to factor in permits, modifications to make the containers livable, and the expertise of a trained engineer to make sure you are meeting all safety codes.

Furthermore, don’t forget that often shipping containers are painted with hazardous materials to protect their outer surfaces from salt water and extended outdoor exposure. You will have to consider your future residents’ safety and that of your remodelers when cutting into and refinishing the metal shells.

If you plan to purchase your shipping container homes already completely upgraded, remodeled, and refurbished, then you might pay anywhere from $185,000 to nearly $1 million, depending on where you are purchasing the home and what all is included with the purchase. MoneyCNN.com recently covered the release of a six-container home kit that cost less than $185,000 and offered 2,000 square feet of living space once assembled. On the other end of the spectrum, a much smaller luxury container home in San Diego, California, recently hit the market at $799,000.

By comparison, the average price per square foot to build a traditional brick and mortar home is around $150/square foot for a 2,000-square-foot home for a grand total of $288,301 according to homevisor.com. Of course, depending on the amenities inside, container homes can cost considerably less than or just as much as a traditional home.

Joining the Container-Home Movement

Real estate investors can invest their capital at various points in the container-home creation process [see sidebar]. Passive investments can help build multi- and single-family communities as well as housing for the homeless and over-all affordable housing. You can also purchase prefab container homes and create multi-family units according to your lot size. As companies start to understand the market and associated costs more clearly, a growth in predictable options and outcomes will emerge.

Of course, always do your due diligence and have a clear and proven strategy for entering and exiting the investment. Just about anything you can imagine for an interesting and innovative design can be accomplished with the use of these upcycled materials. Container homes are changing the way society views building and rehabbing. In the coming years, you will likely see these reusable containers popping up all over the country.


Getting Started with Container Homes

With an unconventional investment like container homes, a clear eye for the end game is important. Michael Swinton of Millennium Home Designs offered these tips for container-home investors:

• Work with a contractor who already has experience with container homes.

• If using prefab container homes, try to pick a company that will do the finishing after the delivery.

• The short project timeline may be deceptive. Although the lead time on a container home is usually about six weeks, start slow. You can always invest in multiple projects later, once you understand the process.

• Select a market that is friendly to your unconventional building and provides the opportunity for the returns you need.