It may be the most expensive mobile home park in Northern California.

Developer Barry Swenson is building upscale prefabricated homes at the former run-down Los Gatos Mobile Home Park, and this week announced the wood and stucco homes will sell for upward of $800,000.

Prices could easily top $1 million for some of the homes on larger lots or homes in prime creek-side locations at the park now called Creekside Village Los Gatos. While the factory-built structures qualify technically and legally as mobile homes, these don't look anything like your grandma's double-wide. Many will feature upgraded amenities, such as cherry-wood cabinets, crown molding and granite counters. Of course, these touches also add to the base cost.

The attractive two-story townhomes with cozy front porches are a far cry from the aluminum-sided, flat-roofed trailers that once filled the old mobile home park and still dot parks across the country. Housing experts say this new generation of prefab homes is rolling out units that rival or better conventional homes because wood and other materials are processed in factories with tight quality control.

Still, many would-be buyers of the Los Gatos homes are staggered by the price tag.

"It's pretty outrageous," said Tim Duffy, who put his name on a waiting list in December to purchase one of the Craftsman-style homes near downtown. "But when I heard $800,000 -- and that's starting in the $800,000s -- I backed away. Doesn't that seem a bit out of context for a prefabricated house?"

Project manager Jeff Major and plenty of area real estate agents say no.

"The bottom line is location, and this place has it," said Brian Crane, vice president and managing partner of Intero Real Estate Services. "Los Gatos is a popular place to live, people like the downtown, they want the schools. If it hadn't been a mobile-home park, nobody would be saying it's outrageous. They won't have any trouble selling."

Major said homes next to the new development range from $800,000 to $1.5 million. "There's a few worth $800,000 that I wouldn't let my dog sleep in," he said. "When you compare them and the higher-end homes in the downtown to what we're offering, ours are more affordable."

As good as 'stick-built'

Major said the new townhomes are exactly the same kind of houses that Swenson would build if he were building them from the ground up on the site. The walls are as sturdy and the foundation is probably stronger than a "stick-built" house, he said. And they're as quake-safe as a conventional home.

Swenson was locked into building prefabricated homes at the site because he decided to keep the 12-acre property's zoning as a mobile-home park. That way he was able to build as many as 70 homes, replacing the exact number in the previous park.

Under a special financing arrangement with Swenson, about 10 former park residents who had lived in run-down coaches at the site will be able to purchase new homes at reduced prices.

The closest factory-made homes comparable to those at Creekside Village are in tony Newport Beach and Malibu, where units sell for up to $1 million.

Each of the two-story homes arrives in Los Gatos from Hermiston, Ore., in four separate modules. The stackable units are hoisted in place with a huge crane. Plumbing and electrical wiring and sometimes wall cabinets are built in. The four shells are bolted together, and construction crews build garages and in some models second-floor rooms on top of the garage. Concrete is poured for driveways.

The wood used in the homes is kiln-dried in the factory, said prefab home manufacturer Marlette Homes, so it has less moisture and is not susceptible to mold.

Although prefabricated housing is less expensive than conventional housing, Major said by the time transportation costs, plumbing and wiring connections and other site construction was completed, the first batch of Los Gatos homes ended up costing as much as a "stick-built" house.

What drives the market price to astronomical heights is the land homes sit on. Los Gatos is one of the priciest markets in the Bay Area.

Owning the land

One unusual purchasing feature in the development is that owners will own the land under their homes as well as the homes, unlike other housing designated as mobile-home parks.

New homeowners in Creekside Village will have ownership documents with disclosures that homes are in a mobile home park zone and that they are largely factory built. No one expects that to affect prices. Some 300 to 400 interested buyers have put their names on a waiting list for the homes.

The townhomes will range from 1,250 to 1,750 square feet on lots from 1,800 to 5,000 square feet, Major said. The development will have a community center, pool and weight room.

The first release of 10 homes will be up for sale starting Sunday. An open house of the two finished model homes starts Saturday. On Sunday, pre-qualified buyers can submit sealed price bids for individual homes. The bids will be unsealed on April 18. Homes will sell to the highest offers with the best terms, Major said

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